Bangladesh’s readymade garment industry is facing a deepening crisis as weakening global demand and rising domestic pressures push manufacturers to seek urgent financial and policy support from the government, industry leaders said.
The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has warned that the country’s largest export sector is under severe strain, citing falling orders, rising production costs and tightening cash flows across factories.
BGMEA leaders raised the issue during an emergency meeting with Finance Division Secretary Md Khayeruzzaman Majumder on Tuesday, calling for immediate intervention to prevent further factory closures and job losses.
Data presented by the association showed that growth in readymade garment exports declined by 2.43% in the first seven months of the current fiscal year 2025–26, reflecting weaker demand from major markets amid global economic uncertainty.
The garment sector accounts for more than 80% of Bangladesh’s export earnings and employs millions of workers, making it central to the country’s economic stability. Manufacturers say buyers in Europe and the United States are placing fewer orders while continuing to push for lower prices, squeezing already thin profit margins.
Domestic challenges have added to the pressure. Factory owners cited higher production costs, wage increases following recent pay adjustments, and reduced operating days due to public holidays, national elections and the upcoming Eid-ul-Fitr festival. These factors have intensified liquidity problems, particularly for small and medium-sized factories.
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BGMEA officials said about 400 garment factories have shut down over the past year, while many others remain at risk. They warned that without timely support, factories may struggle to pay wages and festival bonuses, potentially triggering labour unrest.
The association has urged the government to expedite the release of pending cash incentives and provide low-interest loans to help factories meet salary and operational expenses during the coming months. It also called for improved coordination with banks and the central bank to ease access to credit.
Officials present at the meeting acknowledged the industry’s concerns, according to people familiar with the discussion, though no immediate commitments were announced.
Economists say prolonged weakness in garment exports could put pressure on foreign exchange earnings and overall economic growth, increasing the urgency for policy action to stabilise the sector.
