Wage protests shut Yunus’s Bangladesh factory

DHAKA — A high-profile Bangladeshi garment factory, run as a social enterprise by Nobel winner Muhammad Yunus, has been shut after workers staged violent protests over wages, police said Wednesday.

Grameen Knitwear, one of dozens of businesses the 2006 Nobel Peace Prize laureate has launched, was closed after more than 2,000 workers vandalised the $23 million plant on Tuesday, local police chief Sirajul Islam said.

“The management closed the factory indefinitely after workers held violent protests, demanding a big hike in lunch fees and transport costs and at least 10 percent ownership in the company,” he said.

Yunus won his Nobel prize for his work at Grameen Bank, a microfinance lender he founded that helped mostly poor women in rural areas to start their own businesses.

He also runs more than 30 businesses that aim to pay decent wages and offer protection to employees. Profits are reinvested rather than distributed to the owners.

The unrest is a second blow to Yunus who was sacked from Grameen Bank in March by the central bank after a campaign by the government to oust him.

Islam said police were investigating the protests at the plant, 25 kilometres (15 miles) north of the capital Dhaka, as Grameen Knitwear was one of a very few companies with a “good history” of payment to workers.

“They vandalised the factory, shattering its windows and were trying to torch cartons full of export-bound apparel,” said the police chief.

Many workers turned up Wednesday morning but left after seeing a notice pasted on the factory-gate, announcing the indefinite shutdown of the plant by the management, he said.

Analysts say Yunus’s huge influence in Bangladesh, his brief foray into politics in 2007 and his move into other businesses such as solar panels and mobile phones, has triggered government resentment.

Ashraful Hasan, chief executive of Grameen Knitwear, ruled out any political motive behind the protests, but he rejected the workers’ demands, saying the company was already paying better than most other garment firms.

“We are the top five garment manufacturer in terms of wages and workers’ benefits. We pay far above the government-set minimum wages. Still, some workers launched protests, making irrational demands,” he told AFP by phone.

After his sacking, Yunus said he wanted to focus on his social businesses. He has launched joint ventures with top global giants such as Danone and Veolia of France and Adidas of Germany.

But disputes have emerged over the ownership of the businesses.

Yunus, who chairs the boards of the Grameen social businesses including Grameen Knitwear, insists the companies are separate entities and the Grameen Bank does not own any stake in them.

But a state panel says the micro-lender should be in charge of the social businesses so that the dividends can be distributed to the eight million poor women borrowers who are the owners of Grameen Bank.
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