Bangladesh Garment Factories Reopen after Sheikh Hasina’s Flight

Garment factory workers break for lunch, in Dhaka on August 7, 2024 (AFP)
Garment factory workers break for lunch, in Dhaka on August 7, 2024 (AFP)
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Bangladesh Garment Factories Reopen after Sheikh Hasina’s Flight

Garment factory workers break for lunch, in Dhaka on August 7, 2024 (AFP)
Garment factory workers break for lunch, in Dhaka on August 7, 2024 (AFP)

Garment factories in Bangladesh, forecast to account for 90% of the country's exports, reopened on Wednesday hoping to swiftly resume full operations after production was disrupted by violent protests that ousted Prime Minister Sheikh Hasina this week.

Hasina resigned and fled the country on Monday after around 300 people were killed and thousands injured in a crackdown on student-led protests since July.

Garment and textile factories which supply major western brands such as H&M, Zara and Carrefour had been forced to shut under curfews imposed during the unrest.

"We lost a total of four days, it is too early to make an estimate of the loss. There was little physical damage to factories," Miran Ali, vice president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), told Reuters.

"I am hopeful that in the next few days, we will see complete normalization," he said. "I'm confident our buyers will stand by our side."

He added that H&M, which sources garments from about 1,000 factories in Bangladesh, had already said it would not seek discounts due to the delays. The world's second largest fashion retailer had said it was concerned about developments in Bangladesh.

At a factory belonging to apparel maker Urmi Garments in Dhaka, the mainly female employees were back operating sewing machines.

"We went out of work, sitting idle at home. We were scared. We are poor people depending on daily wages and overtime. If we sit back home, how can we run our families?" 38-year old Razia Begum, an employee at the factory, told Reuters.

Factory manager Emdadul Haq said the factory had lost 228,000 pieces of production worth $107,000. In all, Urmi, which counts H&M, Japan's Uniqlo and Britain's Marks and Spencer among its clients, had lost about $2.2 million across three units, he said.

The International Monetary Fund expects the ready-made garments industry will account for 90% of Bangladesh's $55 billion annual exports in the financial year 2024.

Bangladesh was the third-largest exporter of clothing in the world last year, after China and the European Union, according to the World Trade Organization. Nearly half of its exports in the July 2023-May 2024 period were to the EU, worth $21.65 billion.



Gold Firms as US Rate-cut Optimism, Geopolitical Risks Lend Support

Ingots of 99.99 percent pure gold are placed in a workroom at the Novosibirsk precious metals refining and manufacturing plant in the Siberian city of Novosibirsk, Russia, September 15, 2023. REUTERS/Alexander Manzyuk/FILE PHOTO Purchase Licensing Rights
Ingots of 99.99 percent pure gold are placed in a workroom at the Novosibirsk precious metals refining and manufacturing plant in the Siberian city of Novosibirsk, Russia, September 15, 2023. REUTERS/Alexander Manzyuk/FILE PHOTO Purchase Licensing Rights
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Gold Firms as US Rate-cut Optimism, Geopolitical Risks Lend Support

Ingots of 99.99 percent pure gold are placed in a workroom at the Novosibirsk precious metals refining and manufacturing plant in the Siberian city of Novosibirsk, Russia, September 15, 2023. REUTERS/Alexander Manzyuk/FILE PHOTO Purchase Licensing Rights
Ingots of 99.99 percent pure gold are placed in a workroom at the Novosibirsk precious metals refining and manufacturing plant in the Siberian city of Novosibirsk, Russia, September 15, 2023. REUTERS/Alexander Manzyuk/FILE PHOTO Purchase Licensing Rights

Gold prices drifted higher on Wednesday driven by safe-haven demand and rising bets that the US Federal Reserve might reduce interest rates as early as September.

Spot gold rose 0.6% to $2,402.43 per ounce, as of 1242 GMT, having settled lower in the previous four sessions. US gold futures gained 0.5% to $2,442.70.

Gold is seeing some "stabilization as some interest develops in the physical gold markets in the far East; geopolitical tensions are still supportive," said StoneX analyst Rhona O'Connell, Reuters reported.

"It's possible that some distressed sellers from the weekend/Monday will be looking to re-establish their positions as gold has done its usual job by providing liquidity ahead of potential margin calls."

Prices fell as much as 3% on Monday, caught in a global sell-off driven by fears of a US recession.

Bullion is considered a hedge against geopolitical and economic uncertainties and tends to thrive in a low-interest-rate environment.

Traders have altered their rate cut expectations following the soft jobs report last week, with nearly 105 basis points of cuts anticipated by year-end and a 100% chance of a rate cut in September, according to the CME FedWatch Tool.

The outlook for looser monetary policy provides a supportive element for gold as a non-yield-bearing asset, and this factor has combined with strong central bank buying to deliver a positive performance for the yellow metal in 2024 so far, Kinesis Money said in a note.

Meanwhile, China's central bank held back on buying gold for its reserves for a third straight month in July, official data showed.

Spot silver edged 0.1% lower to $27.02 per ounce.

The expected economic slowdown will dent industrial demand and that is likely to cap the upside for silver, said Ricardo Evangelista, senior analyst at ActivTrades.

Platinum rose 1.8% to $928.25 and palladium was up 2.5% to $896.65.