SEATTLE, Washington — Since the start of the coronavirus pandemic, national and global economies have been struggling across nearly all sectors. COVID-19 has been a severe detriment to the global garment industry, for example. For many countries, especially in Southeast Asia, the garment industry is the backbone of their national economies. Cambodia, Bangladesh and Vietnam have dealt with the lion’s share of issues facing the global garment industry caused by COVID-19.
Bangladesh is heavily reliant on the garment industry. Textiles account for more than 80% of the country’s exports, and about four million workers are directly employed by the industry.
According to the Bangladesh Commerce Industry, about 15 million jobs are reliant on the garment industry. These include truck drivers, port workers and food sellers. However, the Bangladesh Garment Manufacturers and Exports Association reports that buyers have canceled orders worth $3.18 billion. Western buyers, specifically, have also downsized previously placed orders and have demanded 20-50% discounts.
In a survey conducted by Penn State University’s Center for Global Worker’s Rights, more than half of the 316 Bangladesh garment suppliers surveyed reported that most of their finished or partially finished orders have been canceled since the outbreak of the coronavirus. The survey also found that 98% of buyers refused to contribute to the partial wages of furloughed workers. This comes as direct disobedience of what is required by law. Because of this, more than a million workers have already lost their jobs, and half a million more are in danger of being laid off or furloughed.
Since Bangladesh’s garment industry has been suffering, various corporations and organizations are taking measures to correct the situation. Many large contractors, including H&M, Walmart and Primark, have agreed to pay in part or in full for the goods that they have already ordered. Bangladesh Prime Minister Sheikh Hasina has announced stimulus measures totaling more than $8.5 billion, including loans to help factory owners pay their workers’ salaries.
Cambodia’s situation is similar to Bangladesh’s. The textile industry in Cambodia is worth about $7 billion and serves as the main component of the country’s economy. As Western retailers canceled orders and demanded discounts from Cambodian suppliers, the industry began to crumble. According to the Workers’ Rights Consortium, which monitors factories worldwide, at least 14 brands have canceled their orders. They now either refuse to pay for the orders or demand a discount.
About a third of the country’s 600 garment factories have shut down, and tens of thousands of workers have lost their jobs. When facing such rampant unemployment, many Cambodians usually must search for jobs overseas. However, most international borders are closed due to the pandemic and the global economy is facing a depression, making this an impossibility.
On top of that, the Cambodian Ministry of Labor announced that workers would no longer receive benefits. In response, labor rights representatives have banded together to demand all benefits owed to employed and laid-off workers. More than 200 union leaders and activists from 17 unions and federations announced a social media campaign on August 14. The movement demands that the Cambodian government hold factory owners and employers accountable for paying workers the benefits owed to them.
The Vietnamese garment industry differs slightly from those of Cambodia and Bangladesh. They are the country’s third-largest export, behind smartphones and electronics.
According to the Vietnamese Ministry of Trade, apparel production actually rose 13.2% from June to July. However, Vietnam was hit by a new wave of coronavirus cases in early August, and textile exports went down 21%. Many factories did not receive a single order for high-value products for the second half of 2020.
The true cause for the struggle in the Vietnamese garment industry, though, has much deeper ramifications for the global garment industry. Vietnam imports an estimated 89% of the fabrics they use for garment manufacturing. The Southeastern Asian nation imports approximately 55% of fabrics from China. Since the virus hit China hard early on, imports came to a halt. Due to this early disruption in the supply chain, Vietnam is experiencing an acute shortage of materials.
The U.S. and the EU account for more than 60% of Vietnam’s garment exports. In typical fashion, many Western retailers have canceled or demanded discounts on their orders from Vietnamese suppliers. Because of this, the Vietnam Textile Association has reported that 70% of garment manufacturers began reducing shifts and rotating workers by March, with a 10% increase in reductions in April and May.
The coronavirus pandemic has destroyed many aspects of the global economy but has particularly ravaged the global garment industry. Southeast Asia has always been the epicenter for the world’s garments and textiles. As such, has been severely impacted by the pandemic.
While individual countries are making efforts to provide support to these industries, the rest of the world has a responsibility to help these countries as well. Not only should the big brands pay in full for the orders they placed before the pandemic, but individual citizens need to step up to prevent the spread of coronavirus by wearing masks and taking measures to slow the spread of the virus. The sooner the coronavirus pandemic is over, the sooner the global economy can start to recuperate from the damage the virus has caused.
– Caroline Warrick-Schkolnik