"113 RMG factories shut in Ctg for lack of work orders", 2 Dec 2023

The readymade garment sector of the country is facing an adverse situation due to a lack of work orders, the dollar crisis, hikes in gas and electricity prices and the high cost of production.

As the owners failed to cope with the situation, they closed down a total of 113 readymade garment factories in Chattogram.

The demand for clothes made in Bangladesh is now low in the European and US markets. The pace of new export orders is also slow. Besides, the Russia-Ukraine war has reduced the purchasing power of Western consumers.

Reliance Apparel Ltd, an export-oriented garment factory located in BSCIC Industrial Estate, had not been getting work orders from foreign buyers for a long time.

Emdadul Haque, assistant manager of Reliance Apparel Ltd, went to the Chittagong Bond Commissionerate and applied for the cancellation of the company's bond licence. The commissioner cancelled the licence after they found that the company's export-import remained closed due to a financial crisis and lack of work orders from foreign buyers.

SN Sportswear Limited, a company in the Bakalia area, was also facing the same problem. They also applied for bond licence cancellation and the Chittagong Bond Commissionerate cancelled their licence on September 27.

For the same reason, the bond licence of Amazon Apparels Ltd was cancelled on October 3. They also applied for cancellation of the bond licence as they did not get work orders...

However, due to the dollar crisis and the hike in manufacturing costs, western buyers are now cancelling work orders and shifting them to China and Vietnam.

According to BGMEA sources, there were 694 registered factories in Chattogram. As there was no sign of production, Chittagong Bond Commissionerate cancelled the licences of 126 factories in the last 3 years from 2021 to November 30, 2023.

BGMEA vice-president Rakibul Alam Chowdhury told The Business Post recently, "Bangladeshi factories are gradually closing down. The apparel sector is in recession. There are many reasons for the closure of exporting firms. One of the main reasons is a lack of work orders.”

Most of the export-oriented factories in Chittagong have closed down due to a lack of work orders, he added...

“Usually, we receive the February-March orders in November-December. But this year the orders have not come yet. And if it doesn't arrive by December 15, there will be no chance of getting more orders this year.”...