Bangladesh garment manufacturers seek more time to repay COVID loan

The owners of apparel factories have sought more government support to overcome pandemic challenges, including extension of the time to repay the stimulus funds they took to pay wages.

A delegation of the Bangladesh Garment Manufacturers and Exporters Association or BGMEA, headed by their Acting President SM Mannan, made the request in a meeting with Finance Secretary Abdur Rouf Talukder at the Secretariat in Dhaka on Tuesday. 

They asked the government to double the payback period of the loans under the COVID response stimulus package to 36 months to help the sector overcome the hurdles.

The government announced the stimulus packages in March last year to help the export-oriented industries pay workers. The apparel sector was allocated Tk 75 billion at 4 percent interest to pay wages of April, May and June 2020. The government gave them around Tk 30 billion more in July following the owners’ request.

The six-month grace period for the stimulus funds has been extended three times by six months.

BGMEA said in a statement its leaders told the secretary the export-oriented apparel sector was still having “tough times” prolonged by the second wave of the COVID-19 in Bangladesh.

Major export markets of Bangladesh, including Europe, are yet to get back to a fully normal state, they said.

“It was expected that the apparel sector could turn around with improvement in the pandemic situation but the surge of new variants and infections put the industry in challenges again.”

The BGMEA leaders urged the government to write off all debts, interest, and cost of fund charges for the “133 sick RMG factories” that are struggling for survival due to the pandemic, taking them into special consideration.

They also called for an exit policy for businesses who want to shut down their operations safely.

They asked the government not to treat compliant units of a group of companies as loan defaulter for the failure to repay of any of its concerns, as other profitable and compliant enterprises of the group would be affected.

Former BGMEA president Md Shafiul Islam Mohiuddin, vice-presidents Shahidullah Azim, Khandoker Rafiqul Islam and Director M Ahsanul Hoq were also present at the meeting.