BGMEA, a group of ready-made garment industry owners, sought the three benefits of emergency fund, loan guarantee scheme and back-to-back lending policy to Bangladesh Bank in the face of China’s coronavirus.
BGMEA President Rubana Haque gave a letter to the Governor of Bangladesh Bank Fazle Kabir on February 7. Copies of the letter were also given by Finance Minister AHM Mustafa Kamal, Commerce Minister Tipu Munshi, the Prime Minister’s Private Sector and Investment Advisor Salman F Rahman, and the Prime Minister’s Office Secretary Ahmed Kaiqaus.
According to BGMEA’s letter, $8 bn worth of goods and raw materials has been imported from China in the last fiscal year. It contains $12 mn worth of yarn, fabrics and other raw materials. About 8 percent of the garment sector’s raw material comes from China.
If the coronavirus is not controlled in a quick time, the clothing sector will have a serious impact. Chinese ship arrives at the port of Chittagong at zero point. According to the National Board of Revenue (NBR), imports have decreased by 5 percent on the first of this month.
Regarding their claims in this situation, BGMEA has said that production will be disrupted if timely raw material is not available due to coronavirus. Entrepreneurs may need to ship products at their own expense or collect raw materials from alternative sources. Then there will be an urgent need of funding for the extra cost of the factories. Again, delays in importing raw materials will have to be amended to back-bank LC policy to prevent various complications. Apart from this, the need for import of raw materials from alternative sources so that the commercial banks can continue to assist entrepreneurs, Bangladesh Bank’s special credit guarantee scheme is required.
BGMEA President Rubana Haque said, “Due to the Chinese New Year’s holiday, most of our entrepreneurs have collected the necessary raw materials for production by April.” But if the raw material is not produced in March due to the coronavirus, it will have a negative impact on the production in May. ” Production is starting. Nevertheless, the letter has been prepared as a way to deal with the situation when the situation is awkward.
Meanwhile, a high-level meeting is to be chaired by the Prime Minister’s Principal Secretary Ahmed Kayakous on February 26 to address the crisis arising out of the import and export of goods from China and neighboring countries, according to the BGMEA letter.