Eight factories in two Export Processing Zones (EPZ) in Chattogram have shut down after failing to pay workers because of insufficient work orders during the Covid-19 pandemic.
Six of the factories are from Chattogram EPZ, and four of them are owned by Bangladeshi companies and two by Danish companies.
Two factories – one owned by an Indian and the other a UK company – have closed down in Karnaphuli EPZ.
According to Bangladesh Export Processing Zones Authority (Bepza), these factories have shut down due to various reasons including declining export orders, internal management problems and inability to pay wages on time.
Meanwhile, at least five more factories in the two EPZs may also shut down due to the pandemic, according to the Bangladesh Export Processing Zones Investors Association (Bepzia).
Bepza General Manager (public relations) Nazma Binte Alamgir told The Business Standard, "Currently, 188 factories are running in full swing in the two EPZs. Compared to that, the number of closed factories is not that high. It cannot be said that the two EPZs have been affected very negatively. These factories have shut down due to having multiple owners and problems in management."
According to Bepza, there are 146 running factories in Chattogram EPZ at present with the employment of 157,596 people. On the other hand, 42 factories are operating in Karnaphuli EPZ with an employment of 72,836.
The six factories closed in Chattogram EPZ are A&B Outwear Ltd, Norms Outfit Ltd, Cold Play Ltd, Wink Co Ltd, Peninsula Garments Ltd and Mithun Knitting and Dyeing Ltd.
Nazmul Abedin, a UK citizen of Bangladeshi descent, owns A&B Outwear, Norms Outfit Ltd and Cold Play Ltd factories in Chattogram EPZ. About 1,800 workers worked in these three factories. He has shut the factories after failing to repay loans taken from various banks.
Of the three factories, Bangladesh is shown as the investor country of Norms Outfit and Denmark is mentioned as the investor country of the two other factories on the Bepza website.
Meanwhile, the Chattogram EPZ has auctioned A&B Outwear and Norms Outfit Factory for Tk25 crore. Besides, the investors of the remaining three factories closed in Chattogram EPZ are owned by Bangladeshis.
According to Bepza, beside these six factories, another factory named Padma Wears has shut down in Chattogram EPZ recently. The EPZ authorities have started the auction process of the Bangladeshi owned factory.
The two factories closed in Karnaphuli EPZ are Indian owned PRM Fashion Ltd and Valtex Ltd, owned by a UK company.
Several investors in the two EPZs, speaking on the condition of anonymity, said that it has not been possible to balance expenditure with income due to the pandemic. It has also been hard for them to pay wages, gratuity, provident fund and other benefits for the workers.
Azizul Bari Chowdhury Jinnah, general secretary of Bepzia's zonal executive committee, said, "The number of factories closed in the EPZ is far less than the number of factories closed outside the EPZ. There are possibilities that these factories can be relaunched after changing ownership."
Some 47 garment factories have been closed in Chattogram outside the EPZs due to the pandemic. About 22,000 workers in these factories have lost their jobs.