A slew of 457 industrial units have faced permanent closure during last two years mainly because of shrinking work orders, owners' financial crisis, labour unrest and energy crisis, sources say.
The latest fall was on Tuesday of twin factories in Gazipur-Unique Designers Ltd and Unique Washing and Dyeing Ltd. Their permanent closure was announced after lying temporarily shut since June 16, citing financial crisis.
The industrial nemesis results in job loss of some 1800 workers, sources in law- enforcing agencies say.
Majority or 398 factories were located in Gazipur, Ashulia and Chattogram industrial belts.
Out of the total closed units, 287 are non-RMG (readymade garment) factories while the rest are affiliated with Bangladesh Garment Manufacturers and Exporters Association, numbering 108, Bangladesh Knitwear Manufacturers and Exporters Association, 35, Bangladesh Textile Mills Association, 08, and Bangladesh Export Processing Zones Authority-affiliated 19, according to data.
Statistics show a total of 79 factories terminated as many as 7,784 workers in the last five months until May 31 amid a fall in production and work orders owing to sluggish global demand and a loss of competitiveness.
Industry insiders also assign a number of factors -- local and global -- behind the closure that include decline in global demand, bankruptcy of global buyers, political reasons, complexities related to banks, factory relocation, shortage of raw materials, impact of wars, geopolitical issues.
They, however, say the elected new government has taken few measures to reopen closed factories, including announcement of financial supports.
Bangladesh Bank through two separate circulars has announced Tk 200 billion worth of pre-finance scheme to revive large industrial and services-sector enterprises that have either shut down or are operating below full capacity for a shortage of working capital.
Another scheme is worth of Tk 50 billion for cottage, micro, small and medium enterprises (CMSMEs).
The central bank, meantime, has asked apparel trade bodies to provide information on closed and partially closed factories.
In this connection, BGMEA organised a discussion meeting with its member-factories on June 14 where many of them raised concerns over some requirements binding the central-bank packages, saying that they, mostly the small and medium ones, could not avail the facilities because of the tags.
When asked, Bangladesh Garment Manufacturers and Exporters Association President Mahmud Hasan Khan said, "All of the closed factories could not be reopened as they don't have the capacity while their CIB (credit information bureau) reports are not 'good'."
Explaining the reasons behind the closure, he cites, among others, global demand fall, shortage of work orders, inefficiencies of some factories and bankruptcy of some buyers as well as political reasons, failure to make timely shipment due to political or other natural calamities.
Talking to the FE, BGMEA vice-president Shehab Udduza Chowdhury said some 200 closed and 123 partially closed factories expressed their willingness to get the government-announced financial packages.
"The units that cannot use full capacity should get priority as employment generation and export earnings both can be increased within the shortest possible time once they get working capital," he says, adding that most of the SMES which need the financial support can't avail it because of the condition of collateral security.
He urges the government to provide loan at 7.0-percent interest for CMSMEs and allow loan-rescheduling facility with minimum down payment.
The BGMEA president, however, says two audit companies will visit the interested factories and submit their reports to the trade body.
The export industry's apex body will recommend to the central bank accordingly, based on reports, for factories suggested by the audit firms.
Munni_fe@yahoo.com
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