Bangladesh riots triggering a ‘real shaking of confidence’ in the country among global fashion brands

It has been reported that several top international fashion brands are cutting Bangladesh orders because of the turmoil that surrounded the fall of former Prime Minister Sheikh Hasina, according to manufacturers in the second-largest garment exporter globally.

Factories had been shut for days after Hasina’s government tried to brutally suppress student protesters, triggering an uprising that toppled her regime just recently. The long period of violence in Bangladesh is estimated to have killed at least 500 people.

Economic backbone of Bangladesh in danger?

Several global fashion brands have come to rely on Bangladesh, primarily due to the abundance of cheap labour. H&M has more than 1,000 entries for Bangladesh-based suppliers on its site. Besides garments, the country is also a large producer of shoes and leather goods.

The deadly uprising compelled Sheikh Hasina to flee into neighbouring India. Economist and Nobel laureate Muhammad Yunus has taken charge as Bangladesh’s interim leaders, and has said his first priority is do bring back peace.

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Bangladeshi exporters said some major brands had shifted orders for upcoming seasons to rival suppliers, disrupting existing global supply chains and threatening the economic backbone of the country of 170 million, according to the Financial Times.

H&M not seeking discount from suppliers due to delays

Opening after days of closure, factories in Bangladesh have resorted to operating overtime and flying products by air, an expensive option that has considerably removed profits for the deliveries, in order to make up a backlog that stretches as far as a month.

H&M declined to directly comment on the claim that it has been shifting orders, but said it appreciated the “steps taken for greater stability”. The group said it is not seeking any discount from suppliers due to delays that might happen under the current circumstances.