Bangladeshi garment exporters are urging authorities to quickly resolve the cash shortage in five to six commercial banks, warning, a failure to do so could lead to significant business disruptions. Bangladesh Garment Manufacturers and Exporters Association (BGMEA) had recently stated that delays in salary payments and difficulties opening letters of credit (LCs) are creating major problems for its members.

Mahmud Hasan Khan, President, BGMEA, said, exporters who use the affected banks are finding it hard to pay their workers on time and to secure the LCs needed to import raw materials. The banks are also reportedly unable to promptly release export proceeds, which is further complicating operations for apparel manufacturers. If banks fail to disburse salaries on time, labor unrest may rise in garment factories, Khan added after a meeting with Ahsan H Mansur, Governor, Bangladesh Bank.

Md Shehab Udduza Chowdhury, Vice-President, BGMEA noted, approximately 350 export-oriented garment factories are being affected by the dollar shortage at these banks. He explained, while importers’ needs are being prioritized, exporters who are earning the dollars are unable to access them. This is preventing them from settling back-to-back LCs and purchasing raw materials for production.

The current demand for dollars has increased following the US's finalization of a 20 per cent tariff settlement. This has prompted international retailers and brands to place more orders for upcoming seasons, increasing the need for dollars to import materials for shipments to the US, Europe, and other markets.

Mansur has assured BGMEA leaders, measures will be taken promptly to ease the liquidity constraints. Chowdhury said they expect the problem could be resolved by the end of the month. Exporters emphasized that any prolonged dollar shortage during this peak season could severely impact the sector's operations and international reputation.