// Asda accused of leaving Bangladeshi garment workers to go hungry after cancelling or suspending orders without full payment
// An activist group said Asda is refusing to accept a percentage of George orders and is imposing “enormous discounts”
Asda has reportedly been criticised by an activist group for leaving factory workers in Bangladesh to go hungry by cancelling or suspending garment orders without full payment.
Anti-fast fashion activist group Remake has accused Asda of the wrongdoing, as well as other retailers including Gap and Primark.
The retailers named in the petition have not yet promised to pay suppliers for all orders that were cancelled or paused as a result of the Covid-19 pandemic, The Grocer reported.
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This has left millions of garment workers in Bangladesh jobless with no access to healthcare.
Remake said Asda is refusing to accept a percentage of George orders and is imposing “enormous discounts” from 40-70 per cent on suppliers for a proportion of orders that have not yet been completed.
The group said this is “particularly disturbing” considering that Asda has remained open during Covid-19 because of their food sales and is presumably making a “significant profit”.
Despite the accusations, Asda said that although it had asked suppliers for a discount, it was on less than five per cent of its orders and all orders that have already been shipped will be paid for.
The Big 4 grocer added it had a “long standing and valued relationship” with suppliers in Bangladesh and intends to honour over 95 per cent of its annual orders with them.
It said it wanted to help the workers “weather the crisis” and continue working together once Covid 19 has passed and factories reopen.
Asda also said it was proactively working with suppliers to agree to mutually cancel the order and pay a proportion of the costs within seven working days.
Remake said it would not remove the named retailers until they promised to pay suppliers in full for orders that were cancelled or paused, without asking for discounts or extending payment terms.
It said that Bangladesh’s garment industry accounts for 80 per cent of the country’s exports, making its economy reliant on apparel orders from Europe.
This follows news that UK retailers had cancelled an estimated £2.5 billion in clothing orders from Bangladeshi suppliers in late April, plunging the country’s manufacturing industry into a “major crisis”.
Sir Philip Green’s Arcadia, Mike Ashley’s Frasers Group, Debenhams, New Look and Philip Day’s Peacocks all cancelled contracts.
Bangladesh’s commerce minister Tipu Munshi called on the UK government to intervene at the time.