Taka 5000 Crore Novel Corona Financial Stimulus Package for Export-Oriented Industries: RMG Trade Union Responses

On 25 March 2020 the Prime Minister of Bangladesh announced a financial stimulus package of BDT 5,000 crore (BDT 50 billion) for export-oriented industries to fight the impact of COVID-19 on the national economy. The package was meant to protect workers by ensuring job security and regular wage payments, as well as the industry through the retention of trained workers and a smoother transition into a post-pandemic economy. Trade unions (TUs) have been vocal about workers’ rights to wages and job security amidst the crisis. Therefore, our research aimed to assess the objectives, design and execution of the stimulus- through the lens of trade unions – to identify the effectiveness of the stimulus in addressing workers’ needs during this crisis. We conducted in-depth qualitative interviews with 20 TU leaders, and also collected secondary data, including the guidelines for the stimulus, from research reports, newspapers, and other sources. This study highlighted certain issues that need to be addressed to ensure the true efficacy of the stimulus. Firstly, the limited size of the stimulus compared to the size of the sector shows that it will not be adequate to cover all eligible RMG factories. Secondly, workers, particularly in small, non-compliant, non-direct export factories, and non-members of BGMEA/BKMEA factories will be excluded from the stimulus package but will need livelihood support. Thirdly, another vulnerability for workers is that the utilization of the stimulus is at the discretion of the RMG employers, which has resulted in continued retrenchments/lay-offs even after the announcement of the stimulus and led to only a portion of BGMEA-associated RMG employers applying for the stimulus leaving many workers potentially vulnerable.

Authors: Sultan, Maheen; Hossain, Md Shanawez; Islam, Mohammad Sirajul; Naim, Sayada Jannatun; Huq, Farah
Type: Report
Year: 2020