The Bangladesh Garment Manufacturers and Exporters Association have confirmed over 176 factories producing clothing garments in Bangladesh have closed since the Rana Plaza disaster in April 2013. Shahidullah Azim, vice-president of the BGMEA, said the reasons for the shutdowns include compliance issues, western retailer audits, higher wages and political disruptions, The Financial Express reported.
Azim said that many buyers are also “no longer placing orders in units located in shared or rented buildings”, and that some owners willingly closed their factories because they could no longer afford to run them.
Closures enforced after inspections
Both the Bangladesh Accord on Fire and Building Safety and the Alliance for Bangladesh Worker Safety are currently conducting inspections of factories making clothing for their members. There have been eight closures as a direct result of these inspections so far, although both the BGMEA and the monitoring bodies expect this figure to rise.
The fundamental objective of BGMEA is to establish a healthy business environment between the manufacturers, exporters and importers whilst at the same time ensuring a steady growth in the foreign exchange earnings of the country.
India has long suffered in its manufacturing sector most notably due to its lack of transparency on processes and clearances. Whilst there is a surplus of affordable labour, there are stringent labour laws and rarely is the labour skilled. The lack of infrastructure means energy, transport and logistics are not readily available.
Source: Fashionunited
