Bangladesh, the second-largest garment producer after China, may lose roughly $6 billion in export revenue this financial year amid cancellations from some of the world’s largest brands and retailers, two major industry bodies said.

The two groups, which represent the vast majority of the readymade garment and knitwear manufacturers in the country, said cancellations were increasing daily following COVID-19 lockdowns worldwide. They said this would lead to millions losing jobs in the poor South Asian countries.

Low wages helped Bangladesh to build its reputation as an important exporter of garments in the world. There are some 4,000 factories, employing 4 million workers, in the country.

“We’ve lost more than $3 billion due to the crisis. All our orders until July have been cancelled or suspended,” Mohammad Hatem, vice president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said.

“Suspended orders will eventually get cancelled. All these orders were placed for summer and it takes three months to get these delivered. If they are not taking supplies now they will not take it when the summer is over,” said Hatem, adding buyers had adopted a wait and watch policy, and are refraining from placing new orders.

“Many factories will be closed if this persists,” he added.

Garment exports accounted for $34.12 billion, or 84% of the country’s overall exports of $40.53 billion, in the fiscal year ended June 30, 2019.

Rubana Huq, the president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) said readymade garment makers face a similar problem.

Huq said some 1,048 factories that were part of BGMEA had reported that orders for over 900 million garments worth $2.9 billion had already been cancelled or were being held up.

Orders have been cancelled, affecting some 2 million workers in the readymade garments segment, Huq said.

Prime Minister Sheikh Hasina recently announced a $588 million package for the country’s crucial export sector, asking companies to put the money towards paying workers.