Bangladesh Faces Worst Economic Slowdown in 40 Years: 500 Factories Shut Down

Two years ago, student-led protests in Bangladesh forced Sheikh Hasina from power. At the time, the country's economy was in relatively good shape, and employment opportunities were available. The students then pledged to build a new Bangladesh, but widespread violence, looting and chaos forced Prime Minister Sheikh Hasina to leave the country. Muhammad Yunus subsequently came to power, promising the public a bright future, followed by the formation of a government led by Tarique Rahman. However, within just two to two-and-a-half years, Bangladesh's economic situation has deteriorated to such an extent that workers from the garment industry, which employs more than one million people, are now taking to the streets and staging violent protests.

• 529 garment factories have shut down in Bangladesh, leaving more than one million workers dissatisfied. The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) have reported these figures.
• Thousands of workers have taken to the streets, demanding higher wages. Protests have turned violent in several places, particularly in major industrial centres such as Dhaka, Gazipur and Ashulia.
• Inflation in the country has risen sharply. Workers are demanding an increase in their monthly wages from 12,500 taka to 30,000 taka. In response, the government has hurriedly established a wage board.
• Garment factories are the backbone of Bangladesh's economy, accounting for more than 80 percent of the country's total exports.
• The International Monetary Fund (IMF) has projected Bangladesh's economic growth at its lowest level in the past 40 years. The country's growth rate is expected to remain between 2.2 percent and 3.6 percent.
• More than 500 ready-made garment factories have shut down across several industrial areas of Bangladesh. Thousands of workers from hundreds of other factories have also taken to the streets. Violent clashes between police and workers have erupted in Dhaka, Gazipur and Savar. Vehicles and other property have been set on fire, while major roads have been blocked due to the clashes, bringing factory operations to a standstill. Protesters have set fire to police posts, police vehicles, fire service vehicles, a jute warehouse and a bank.
• Gazipur and Mymensingh are among the worst-affected areas, where 276 factories have been closed. In addition, operations at 185 factories in Savar, Ashulia and Jarabo have been suspended. Another 68 factories have shut down in areas under the jurisdiction of Dhaka Metropolitan Police. On Sunday, Tarique Rahman's government established a six-member wage board for garment workers, but protests have continued. Police have used batons, tear gas, water cannons and sound grenades to disperse demonstrators and control the crowds. Five platoons of the Border Guard Bangladesh (BGB) have been deployed in the affected industrial areas to restore law and order.
• Amid the violent protests, garment manufacturers have warned that they may be forced to shut down their factories if violence and unrest continue despite the establishment of the wage board.
• The IMF and the World Bank have warned that Bangladesh's economy has reached a critical condition. The country is facing a banking crisis, severe fuel shortages and extremely high inflation.
• Economic growth is projected to remain close to 3.5 percent, the lowest level in the past 40 years. Lending to the private sector has declined, while foreign direct investment (FDI) has almost come to a standstill.

Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Mahmud Hasan Khan held an emergency meeting with garment industry representatives at the association's office in Dhaka on Sunday. The meeting focused on the ongoing unrest among workers, following which he issued a warning. He urged labour organisations and federations to act responsibly and help bring the workers' movement under control. He also called on the Home Minister to make it clear that anyone involved in violence would face legal action, regardless of whether the individual was a worker or a factory owner.