BANGLADESH: Apparel makers seek banking support to offset losses
Bangladesh's apparel makers are seeking concessions from banks and insurance companies to help offset losses caused by on-going unrest and the new 77% hike in minimum wages.
Among the measures they are hoping to secure is a two-year exemption on interest charged on loans, along with special loans to help implement new wages agreed for the sector's 4m workers from this month.
The demands were raised at a meeting with the chairmen and managing directors of banks and insurance companies at the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) headquarters in Dhaka.
"We want to implement the new package of workers' wages despite various difficulties, and so the support of bankers is very much needed in this time," Atiqul Islam, president of the BGMEA, said.
The country's ready-made garment (RMG) workers are to see their monthly wages rise to BDT5,300 (US$68.17) at entry-level, up from BDT3,000 (US$38.58).
Among the demands being made by garment makers are a two-year exemption from classifying loans of any textile, garment and backward linkages from fourth quarter of 2013, and uninterrupted facilities on letters of credit for the next two years.
Islam also said exports have been severely hampered by frequent strikes, blockades and shutdowns, which "forced exporters to go for expensive air shipment to meet deadlines."
He added: "In some cases, exporters are also facing penalties and order cancellation due to delayed shipments."
The banks, however, say many of the demands can only be met by the finance minister and the governor of Bangladesh Bank (BB), the country's central bank.
- PSF 2014: No one size fits all in apparel sourcing
- PSF 2014: Shifting focus from cost to consumer
- Garment manufacturers eye Myanmar outsourcing
- Bangladesh industry development moving backwards
- Teen retail being rocked by fast fashion headwinds
- Adidas China supplier in discussions over strike
- Gap issues mirror widespread industry challenges
- Bangladesh PM asks clothing buyers to pay more
- H&M "pushing the process" on sustainable fashion
- Adidas plans mobile phone hotline at all suppliers
- Ethiopia – the emerging textile and clothing industry
- Antimicrobial fibres, fabrics and apparel: innovative weapons against infection
- Trade and trade policy: clothing imports, consumer expenditure and trends in five emerging markets: Brazil, Colombia, India, Kazakhstan and Peru, 4th quarter 2013
- Sustainable Textiles for Apparel: Fact, Fiction and Future Prospects
- Jeans in Italy