Ready-made garment (RMG) factory owners have called upon the government to extend the time limit to five years, from two years, to repay their loans under the stimulus package announced for export-oriented industries.
At the same time, they have also demanded an extension of the moratorium period of up to one year, from the six months scheduled to be over this month – December.
They further want another stimulus package to be declared by the government to help them survive the impacts of a possible second Covid-19 wave.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Rubana Huq made these requests, on behalf of apparel makers, at a virtual press conference on Monday in the capital.
Seeking the extensions, the BGMEA has already applied to the Ministry of Finance and Ministry Of Commerce, sources said.
For the April-July period, the ready-made garment makers took a loan of Tk10,500 crore at minimal service charges from the government fund to pay workers' salaries and allowances.
At the press conference, the BGMEA president said the apparel entrepreneurs have no capacity to repay the stimulus loans from next month as most of their factories are running with fewer buying orders than their capacity and a number of payments have been deferred due to the pandemic.
Rubana said the association recently performed a study on the situation of buying orders, to which 50 factories reported they are getting 30% fewer orders for the coming months.
However, 354 out of 4,500 factories registered with the BGMEA responded to the study, she said.
She claimed the apparel products witnessed an average price slump of 1.79% during the 2014-2019 period, adding that, in September, the value of apparel products dropped by 5.23% on the global market.
"Bangladesh apparel exports to major markets declined slightly in July, August and September but substantially in October, which we see as the impacts of the Covid-19 second wave," the industry leader said.
As of October 2020, garment exports to Bangladesh's major markets – the United States, Germany, Spain, France, Italy and Japan – have declined by 8%, 10%, 6%, 15%, 30% and 28%, respectively.
RMG exports fell by 2.66% year-on-year in a single month in November. In the previous month, the year-on-year growth in apparel exports was reported at negative 7.8%, according to the Export Promotion Bureau.
In November, RMG exporters earned $2.44 billion, slightly up from $2.3 billion earned in the previous month.
The BGMEA's 37th annual general meeting was held virtually on Monday.