Rubana Huq did not announce job cuts: BGMEA

Bangladesh Garment Manufacturers and Exporters Association (BGMEA) says its President Rubana Huq did not announce anything about job cuts in the sector.

A press conference arranged on Saturday by labour activists under the banner of the "Garment Workers' Rights Movement" had drawn the attention of the BGMEA authorities, according to a press statement issued by BGMEA on Saturday.

The apex body of country's apparel industry believes the matter was not presented objectively. Rubana Huq did not announce to retrench workers.

As an organisation, BGMEA does not have any scope to make such an announcement.

The BGMEA president had expressed her deep concern over a decline in employment opportunities and fear of potential job cuts.

According to BGMEA, the industry witnessed a 14 percent decline in growth in the first ten months (July-April) of the current fiscal year, which is the most negative growth figure for the industry in the past five years.

From May 1-20, the industry grew at 55.7 percent negative growth. More than $3 billion worth of buying orders have been cancelled in the garment industry since March this year, BGMEA says.

The international apparel market has shrunk under the influence of Covid-19. Many big buyers have also gone bankrupt due to the pandemic.

BGMEA claims that in the current situation, no factory is able to use 100 percent of its capacity. There are also cases where factories are running at just 35 percent of their capacity. Even big factories are not able to use more than 60 percent of the capacity.

Garment factories are continuing their production activities using an average of 55 percent capacity this month.

Right now, it is difficult to predict what will be the situation in July. However, entrepreneurs fear that the coming days will be more challenging for the garment industry, according the BGMEA statement.

According to the international organisation McKinsey, the impact of Covid-19 will reduce the sales revenue of the global garment market by 30 percent in 2020 compared to the previous year, meaning the export of clothing items from Bangladesh will drop by $10 billion.

In the current situation, entrepreneurs are struggling to survive. Some 348 BGMEA member factories have been shut down in the last two months alone. There are only 1,926 factories left.

If things go like this, the rest of the factories will either shut down one by one or try to survive without using full capacity in the hope of better days to come, BGMEA fears, adding this is the reality of the world today.

"As we all see, there has been a drastic decline in numbers of both jobs and workers in other countries of the world. We build industry to create employment. Today's reality is cruel for our entrepreneurs as well," reads the statement.

Saying two things are needed to be clarified, the BGMEA adds the entire of the Tk5,000 crore of soft loans announced by the prime minister was being sent directly to workers' bank accounts or mobile accounts.

In this context, it is worth mentioning that the garment sector pays around Tk4,000 crore per month in wages of workers.

After analysing all the data, BGMEA is deeply concerned about the employment of workers in the context of closure of factories or reduction of capacity. Employment is declining not only in the garment sector, but in all other sectors.

If a factory becomes a victim of the ongoing situation, BGMEA expects both the owners and the workers will be respectful towards the labour laws.