Bangladeshi garment workers face ruin as global brands ditch clothing contracts amid coronavirus pandemic

Bangladeshi garment workers face ruin as global brands ditch clothing contracts amid coronavirus pandemic

“My line manager came and told me I didn’t have to work anymore,” said Akther, 25, who has been employed there for five years. She said the company, which could not be reached for comment, decided to close the plant, leaving it without a source of income last March.

“My family works on my only income,” said Akther, who said she takes care of her husband and child. “I don’t know how my family will survive.”

The loss of activity has highlighted a gap between these major brands and the factory owners with whom they contract. Members of the Bangladesh business community say they were left behind to take the tab, which put their factories and workers in dire straits.

“It’s appalling, it’s unreal,” said Rubana Huq, president of the BGMEA, adding that there is little legal recourse in the country for factories to demand that international retailers abide by the terms of their contracts. . “I don’t want any subsidy, I don’t want any kind of charity, I just want minimal justice for our workers.”

The fallout is also devastating news for the economy of the South Asian country, which depends disproportionately on the clothing industry to keep its economy buoyant. According to Trading Economics, clothing accounts for about 80% of Bangladesh’s exports and generated more than $ 30 billion last year, according to the country’s Export Promotion Bureau – making it the second largest exporter of these products to the world after China. In total, the industry contributes 16% of the GDP of Bangladesh.

Millions of jobs at risk

The millions of factory workers aren’t the only ones at risk either. According to the Bangladesh Ministry of Commerce, around 15 million jobs in the country depend directly or indirectly on industry. This includes food vendors, truckers and port workers.

“It is a very dangerous situation which can affect many people,” said Bangladesh Trade Minister Tipu Munshi.

Extensive government blockades have also separated some workers from their families, as many travel from small villages to Dhaka to find work. The capital and largest city of Bangladesh, which was locked at the end of last month, is home to most of the country’s garment factories.

“The biggest problem right now is food, we don’t know how we will eat,” said Rezaul Islam, 26, who said he was laid off in a Dhaka-based factory in late March and is now stuck in the city . The nationwide lockdown, which has been extended until Saturday, prohibits people from going outside except to shop for groceries, medicines or other basic necessities.

“We have families in our village who depend on us,” said Islam. “Whatever we earn here, we send it home. Now my family (will have to) live without eating.”

A clothing factory is considered empty during the government-imposed closure as a preventive measure against the COVID-19 coronavirus, in Dhaka on April 6, 2020.

A question of ethics

Islam called on factories to pay their workers during the crisis. Wages are already low in the industry, which means that many workers do not have much savings to invest now.

“It is not fair to expel us like this,” said Islam. “Either we give up our work or we give three months’ wages.”

Permanent workers who are laid off after being in a company for at least one year are entitled to remuneration for at least 60 days, in accordance with Bangladesh labor law. Islam says it was paid for a month. The factory where he worked, Saturn Textiles Ltd., could not be reached for comment.

But factory owners point out that they can’t support their workers alone, especially if the brands they work with do not live up to the terms of their contracts. More than half of the 316 suppliers in Bangladesh interviewed by the Center for Global Workers’ Rights at Penn State University said that most of their completed or current orders had been canceled since the start of the pandemic. The respondents of the survey were mainly European and American brands.

The survey found that over 98% of buyers refused to contribute to the part-time wages of workers on leave required by law. Buyers are contractually obligated to cover the full cost of the goods they ordered, including 16% for payment of wages, says BGMEA. Factories have to buy raw materials and pay staff and overhead before being paid by brands and retailers, says Rubana Huq, which means that all business risks are assumed to end.

Respecting these contracts is the ethical thing to do, said David Hasanat, president of the Viyellatex group, which has six factories in Dhaka.

After the garment factory collapsed in the capital seven years ago and the deaths of more than 1,000 people, an uproar was raised over ethics in the industry and nearly 200 brands and more 1600 factories have signed an agreement promoting safe working environments for workers.

“They talk about sustainability, they talk about ethics,” said Hasanat. “So it’s time to show their good words, which they really believe [in] this ethics. “

The role of international brands

CNN Business has contacted several major international brands that deal with Bangladeshi factories for comment.

Certain brands, including the Swedish clothing chain H&M, the American supermarket giant Walmart ((WMT) and the British retailer Primark, have agreed to pay for all or part of the goods they have already ordered.

“We intend to honor our commitments to products that are finished or in production, and we work with suppliers on a case-by-case basis to resolve any exceptions and develop solutions to minimize impact”, a Walmart said in a statement. The company estimates that “exceptions” account for less than 2% of their annual clothing orders in Bangladesh.

Primark, which the Penn State study designated as a brand that has not made a firm commitment, said on Monday that it “will now take all products that were both in production and finished, and whose delivery is scheduled for April 17 “.

Retail sales in the United States fell 8.7% in March, the largest decline ever
But others, including Difference ((GPS), have given no assurances, said Aruna Kashyap, senior lawyer in the women’s rights division of Human Rights Watch.

“These workers are really poor,” said Kashyap, based in Dhaka. “They have worked in the supply chains and operations of these brands for months and years. And in this time of crisis, it is really important for brands and retailers to shoulder their human rights responsibilities . “

When asked if the company would pay for goods ordered from Bangladeshi factories, Gap told CNN Business that the company “makes decisions based on the best interests of our employees, customers and partners, as well as health long term of our business. ” including reduced spending after store closings in North America and Europe.

“We are committed to working closely with our longtime suppliers to better assess how we can work together during this crisis,” said the company.

An exterior view of the fashion retailer Gap & # 39; s Oxford Street store on February 11, 2016 in London.
Others, linked to the American retail trade, stressed however that the pandemic had also paralyzed them. Retail sales in the United States fell 8.7% in March, the worst monthly decline on record.
The situation has “created a temporary liquidity crisis that threatens to burn a permanent hole in global supply chains,” said Steve Lamar, president and CEO of the American Apparel & Footwear Association.

“This is why we need governments to work together and with global financial institutions to ensure that there are enough financial resources to maintain the solvency of supply chains, so that they can keep workers employees during these crises, “said Lamar. “Common sense measures such as deferring tariff payments and fully funding retail loan programs – now largely closed – are just two of the tools that all governments should implement.”

An uncertain future

The government of Bangladesh is providing assistance. In March and April, Prime Minister Sheikh Hasina announced more than $ 8.5 billion in stimulus packages, including loans to help factory owners pay workers’ wages.

The bill to save the global economy is $ 7 trillion and is increasing

“The Prime Minister [is] very serious about it, “said Munshi, the Minister of Commerce.” No one should starve to death. They have to get their money, they have to live. “Munshi said that Hasina asked the factory owners to take care of their workers.

Despite this, factory owners expressed concern about the possibility of contracting government loans. The money should still be repaid within two years – a commitment they feared to make given the clarity of the coronavirus pandemic.

“The government is doing its best,” said Hasanat of the Viyellatex group. “But we are not a wealthy country, we do not have a lot of foreign exchange reserves, so I am also worried about whether the government has the capacity to support [during] this uncertainty. “

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *