BGMEA again demands time extension on moratorium, repayment

Staff Correspondent | Published: 18:55, Jan 07,2021 | Updated: 23:21, Jan 07,2021


The Bangladesh Garment Manufacturers and Exporters Association on Thursday demanded again that the government extend the moratorium on the salary stimulus package by six months and the repayment tenure by one year.

The Bangladesh Bank on Sunday asked commercial banks to arrange the repayment by the end of January.

BGMEA president Rubana Huq in an open letter on Thursday said that the BB instructed commercial banks to arrange repayment of the stimulus package by January at a time when the industry, amidst the second wave of COVID-19, was taking a deep plunge into an uncertainty.

‘Without the moratorium of the salary stimulus package being extended by six months or the tenure of the loan being extended by at least one year (currently 24 months) the industry will collapse,’ she said in the letter.

‘This is one of the most tragic turns in our industry. In the absence of proper restructuring or even an exit policy, shrouded by western bankruptcies, hounded by buyers’ unforgiving contracts and force majeure clauses, factories are facing turbulent times,’ the letter read.

The country’s apparel exporters borrowed around  Tk 10,500 crore from the stimulus packages announced in March 2020 with 2 per cent service charge to pay workers’ wages for the month of April, May, June and July.

Amid the COVID-19 outbreak, the government extended the support to the export-oriented sector on condition that exporters would repay the amount in 18 equal instalments with six-month moratorium period.

The BGMEA in October 2020 sent a letter to the finance ministry, demanding five years’ time in place of two years to pay back the loan.

Meanwhile, the BB in a letter issued on December 3 instructed commercial banks to ensure required balance in their current accounts with the central bank as the realisation of repayment instalment of stimulus package, which had disbursed to export-oriented factories to pay workers’ wages, would be started from the last week of January.

Referring to the latest Export Promotion Bureau data, Rubana said that the earnings continued to portray the worrisome scenario of the country’s exports.

As the uncertainties and stresses caused by the second wave still persist coupled with the unavailability of vaccine and the impact on global economy it would leave, this downward trend in export will probably continue till April, she said in the letter.

‘I seek all your help to look at the industry perspective and help us frame our narrative for policymakers to pay heed to the real situation and not the perceived one,’ the letter read.

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