The Epidemic Situation Subverts The Dress Etiquette, And It Is Difficult For Bangladesh To Get Rid Of Poverty By Textile

A decade ago, mostafiz Uddin, a Bangladeshi businessman, founded his own clothing factory with Burton and peacocks, a British fashion brand.

Now the clothes are piled up in the factory. There are about 85000 pairs of pants including burocks jeans.

In an interview with the guardian, Youding said that when Britain announced the "closure" in March, he received bad news: major brands cancelled orders, many orders had been completed for delivery, and 80% of the cancelled orders were not compensated.

He has invested millions of dollars in raw materials and labor ahead of time to produce orders. Now the bank has stopped lending to Youding, the factory can not pay wages, "my life has become a disaster film.".

Youding is not the only clothing factory owner to experience the disaster.

According to the statistics of the garment manufacturing and Export Association of Bangladesh, at least 982 million garment exports in Bangladesh have been cancelled or suspended due to the new outbreak, with a total value of US $3.18 billion, and 2.28 million workers have been affected.

Garment manufacturing is the pillar industry of poverty alleviation in Bangladesh, creating jobs for 4 million people.

While major brands cancel orders, analysts also predict that European and American companies may shift garment production from Southeast Asia to Turkey, Mexico and other countries in order to shorten delivery time and reduce risks.

One million workers fear unemployment

Since the WTO's agreement on textiles and clothing came into effect in 1995, Bangladesh's finished garment exports have been able to enjoy quota free restrictions in European countries, and enjoy quota preferential treatment in the United States and Canada.

Since then, the country's garment manufacturing industry has developed rapidly. With the introduction of a series of new policies such as the United States' tariff relief assistance act for developing countries, together with cheaper labor, Bangladesh will become the world's second largest clothing manufacturer by 2011.

Gap, Zara, H & M and other international brands, as well as supermarkets such as target and Wal Mart, have garment factories in Bangladesh.

Today, the United States, Germany, the United Kingdom, Spain and France are the main markets for Bangladesh's textile and clothing exports. Among them, Europe is the largest market, accounting for nearly 60% of the textile and clothing exports of this South Asian country.

In 2018, Bangladesh's total exports amounted to US $40.5 billion, of which up to US $34.1 billion came from finished clothing exports, accounting for about 84% of the total exports. The whole garment manufacturing industry accounts for 16% of Bangladesh's GDP.

The proportion of finished garment exports in Bangladesh. Source: statista

However, according to rubana Huq, President of the garment manufacturers and Exporters Association of Bangladesh, since Europe and the United States have become the hardest hit areas of the epidemic, the average daily loss of Bangladesh garment factories has reached 100 million US dollars.

From March to June, 179 garment factories were closed across the country; more than half of the $3.18 billion orders cancelled came from European countries. Although countries have begun to restart the economy, the cancellation and postponement of orders of various brands have not improved.

Source: Bangladesh garment manufacturing and Export Association

In addition to cancelling orders, rubana Huq points out that there are also a large number of buyers asking for 20% to 50% discounts from garment factories.

Bangladesh garment workers union center statistics show that among the 2.28 million workers affected by the epidemic, at least 70000 have lost their jobs.

It is predicted that by the end of this year, the number of unemployed people will rise to 1 million. The average monthly income of women workers is only about $110.

In response to the impact of the epidemic, the Bangladeshi government has launched a $600 million assistance program for the manufacturing industry, including clothing manufacturing. But as the epidemic continues, industry insiders worry that garment manufacturing in Bangladesh is facing a fatal blow.

In April, economists at the World Bank warned that the new outbreak could send 50 million Bangladeshis back into poverty. On June 7th, a report from the policy dialogue center of the Dhaka think tank further pointed out that the country's poverty rate may fall back to the level of 40% 15 years ago.

Textile and clothing exporters such as India, Vietnam and Cambodia have also been hit. According to the Wall Street Journal, about 250 garment factories have been closed in Cambodia. Clothing, footwear and bags account for 75% of Cambodia's exports.

Closed retail clothing giant

At the other end of the industry chain, affected by the epidemic, clothing brands were forced to close stores. Ascenda, the U.S. clothing retail giant, and Brooks brothers, a century old store that provides clothing for American presidents, even declared bankruptcy.

On Tuesday, PVH group, the parent company of Calvin Klein, announced that it would streamline its North American business and close 162 retail stores. More than 60% of gap's stores had been closed, and sales of all its offline stores had dropped by more than 50%. In March, H & M sales fell 46% and closed 3778 stores. Zara's 2019 report also showed that 50% of the group's stores around the world were temporarily closed.

In addition to the decline in physical store customers, as more and more people start to work at home, the demand for fashion and formal wear has also shrunk.

According to a June survey by NPD, a U.S. market research firm, 47% of customers wear only one suit a day while working at home. A quarter of the customers like to wear shirts and pajamas.

In an interview with the Wall Street Journal, Achim Berg, a senior partner at McKinsey consulting, predicted that 20% to 30% of Companies in the entire clothing industry chain would fail due to the epidemic.

He also predicted that in the future, in order to shorten delivery time and be more flexible when placing orders, European clothing brands may move part of their production from the Far East to Turkey, Eastern Europe and North Africa, while North American brands will move to Mexico.

Rubana Huq also believes that the garment manufacturing industry "will not go back to the past".