Supply Chains in Bangladesh Hit by Factory Worker Protests

Supply Chains in Bangladesh Hit by Factory Worker Protests
November 3, 2023 Hannah Marshallsay

Protests led by garment workers in Bangladesh have resulted in disruption and stoppages at over 400 factories, driven by their demands for increased wages to counter the impact of high inflation.

Over the last month, tens of thousands of garment workers in Bangladesh have clashed with police as they protest against low wages. It has been reported that the demonstrations have resulted in staff setting fire to factories and, unfortunately, two worker fatalities. 

Rising Living Costs Driving Wage Protests

The unrest has been steadily escalating over weeks of dispute, amid contentious negotiations concerning minimum wages for workers in Bangladesh’s expansive garment sector, which ranks among the largest in the world. The country’s influential manufacturers’ association has proposed a 25% pay increase, a far cry from the unions’ request for nearly tripling the minimum basic wage to $209. They were offered only $91, while the current earnings stand at $72.50. This discord arises from rising living costs and a declining Western demand for clothing exports, which have placed many workers into severe financial hardship.

Implications of Uprising on Supply Chains

Simultaneously with the garment workers’ ongoing protest, political opposition parties in the country have orchestrated a three-day blockade of railways, roads, and ports, leading to significant disruptions in the nation’s supply chains.

Due to reported protests and disturbances on certain roads, inland container depots have refrained from any movement to or from Chittagong port for safety reasons and have sought police assistance to safeguard the transportation of containers to the port jetties. 

Although port operations are still ongoing during the strike, there is a noticeable slowdown in the movement of goods compared to regular periods. It has been estimated that the blockades have resulted in a 50% reduction in container deliveries to Chittagong in the last few days. 

Impact on PFE Customers’ Shipments

Despite the challenges, PFE’s customers have experienced minimal disruption in cargo handovers, with only a limited number of containers missing their shipping line handover dates. 

Nevertheless, all suppliers are currently grappling with delivery difficulties. While we cannot predict future developments, we are taking proactive steps to minimise disruptions. We are advising factories to provide advance notice of cargo handover dates, and should any unexpected issues arise, we will take immediate action and keep you informed.

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