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RMG sector begins to turn around

Published : Wednesday, 15 July, 2020 at 12:00 AM  Count : 326

The readymade garment (RMG) sector has started to regain its position despite apprehension that the industry might collapse in the face of the coronavirus outbreak across the globe. .
The sector had to see cancellation of huge export orders at the first stage of coronavirus pandemic. Now it is receiving a handsome volume of orders from American and European countries.
Following the progress, most RMG factory owners have boosted up the pace of production to supply the ordered products quickly to recover their losses.
Receiving the government financial assistance, the factories have started to work with its full capacity maintaining health guidelines for their workers.
The leaders and experts of the RMG sector, the main sector of Bangladesh's export, said it has started overcoming the crisis created for the Covid-19 pandemic.
At the same time, they are expecting that the industry may help the government to save the country from probable economic recession.
According to the RMG sector sources, production in RMG factories is increasing day by day as the buyers who suspended their orders a few months ago are now coming back in the changed global situation.
Along with reinstating previous orders, they are also giving fresh orders for different products including personal protective equipment (PPE).
As a result, export earning in garment sector has started increasing instead of dropping due to Covid-19 transmission impact.
Factory owners say some      of the canceled or suspended purchases have returned. The factories have also started getting new orders.
Moreover, Covid-19 has changed the types of products. The country's readymade garment sector is receiving huge orders for masks, gloves and PPEs.
Sources said many garment factories have already received orders for PPE to fight against coronavirus.
With direct or sub-contract orders, now most garment factories in Bangladesh are making and exporting PPE, masks, gloves and gowns. It is helping the sector to turn around from the crisis and save the country from economic recession.
After the coronavirus had originated in Wuhan in China at the end of last December some buyers like Primark started cancelling or suspending their orders one after another.
However, H&M, Inditex, Marks & Spencer, Kyabi, Target, PVH and some other buyers have promised to maintain purchase order. As a result, the amount of cancellation and suspension of purchase orders may come down in the coming days.
BGMEA President Rubana Huq told the Daily Observer that some orders were being received. But they are much less than last year. In June, some factories opened with its 55 percent capacity.
RMG factory owners said it's quite impossible to maintain social distancing in factories because of the nature of works. To maintain the guideline, they are working with minimum workforces. As a result, volume of their production is dropping.
BGMEA sources said many garment factory owners are now optimistic about the demand for PPE. At least 100 factories have been producing PPE since the beginning of the Covid-19 epidemic. And this number is constantly increasing.
Ahsan H Mansoor, a renowned economist, told the Daily Observer, the factories were operating at 50 percent capacity. They will get some relief due to PPE production.
According to the Export Promotion Bureau (EPB), the impact of the Covid-19 on garment exports from Bangladesh decreased by 20.14 percent in March this year compared to the same period last year.
Exports continued to decline in June. But its negative growth rate is lower than before.  Beximco is a Bangladeshi company supplying its products to brands like Zara, Calvin Klein and Tommy Hilfiger.
 "We saw the opportunity last February and quickly we started PPE production," said Saeed Naved Hossain, the company's Chief Executive Officer.
He said Beximco exported 6.5 million medical gowns to US brand Hans last month. The company has also set a target of exporting 250 million worth of PPE this year.
Mashiur Rahman, Managing Director of Fakir Apparels, said, "Just three days ago we received orders for 20 million surgical masks."
Fakir Apparels is making PPE in their five factories. And for this additional 400 workers have been hired.
Bangladesh is the world's second largest exporter of readymade garments after China. Bangladesh has been exporting readymade garments at a significant rate for the last two decades.
World renowned brands like H&M, Walmart and Primark used to import garments from Bangladesh.
Meanwhile, the government declared a special fund Tk5, 000 crore for the export-oriented industries. The government is also expanding the facilities of Export Development Fund (EDF) introduced by Bangladesh Bank with Tk12, 750 crore.

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