What: The resignation and flight of Bangladesh’s prime minister amid violent protests have severely disrupted the country's garment manufacturing sector, a crucial supplier for major fashion brands like H&M, Inditex, and Walmart.

Why it is important: Bangladesh is the world's second-largest garment exporter, and the current political instability threatens to delay orders, increase costs, and disrupt supply chains for some of the world's biggest fashion retailers, potentially impacting their sales and inventory management during critical periods.

The sudden resignation of Bangladesh's prime minister Sheikh Hasina and the ensuing political chaos have significantly disrupted the garment industry, which is vital to the country's economy and a key supplier to global fashion brands such as H&M, Inditex (owner of Zara), and Walmart. The unrest began with student protests and escalated due to harsh crackdowns, resulting in curfews, communication blackouts, and factory torches, causing an estimated USD 150 million daily loss in the garment sector. Companies like Hula Global have redirected orders to other countries to avoid disruptions, while others, like Puma, have maintained their sourcing from Bangladesh. The ongoing instability poses significant challenges for brands relying on Bangladeshi manufacturing, particularly with the upcoming holiday season orders.

Bangladesh Crisis disrupts global fashion supply chains