POBNEWS24, Dhaka Jan 21, 2025 : The garment industry, a crucial driver of Bangladesh’s export economy, is currently grappling with a series of challenges that have led to a significant downturn. In the past year, at least 76 garment factories have shut their doors, pushing over 50,000 workers, predominantly women out of jobs. Industry experts warn that the situation may worsen, with more closures on the horizon.
SM Fazlul Haque, the former president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), highlighted the dire circumstances facing the sector. “The garment industry is in distress. Aside from a handful of factories, most are struggling to turn a profit. The longer the machines operate, the greater the financial burdens become. If this trend continues, we will see even more factories go under,” he remarked.
Several factors have contributed to this crisis, including a downturn in international garment prices, which has placed financial strain on factory owners. European Union buyers have reduced their prices for Bangladeshi garments by 5 per cent, while US buyers have slashed prices by 8 per cent. Additionally, overall export orders fell by 3 per cent last year, further complicating the situation for manufacturers.
Haque pointed to a range of issues exacerbating the crisis, such as soaring bank loan interest rates, the depreciation of the Bangladeshi taka against the US dollar, increased raw material import costs, gas shortages, rising GATT tariffs, and unreliable electricity supply. He noted that the sector faced significant disruptions following the government upheaval in July-August when internet services were suspended.
Despite these challenges, Bangladesh’s garment sector achieved exports totaling $38.48 billion in 2024, with knitwear contributing a substantial portion—$20.52 billion—while woven products accounted for $17.95 billion. The BGMEA oversees 2,564 factories, including more than 600 located in export processing zones, but the closure of 76 factories affiliated with BGMEA this year underscores the urgent need for intervention.
Haque underscored the importance of political stability for industrial growth, stating, “A stable government is vital for advancing the country’s industries. We need new leadership to address the ongoing crisis in the industrial sector.”
