LPP reaffirms Bangladesh commitment despite Tk 365cr FES loss

Poland-based global fashion retailer LPP has reaffirmed its commitment to Bangladesh’s garment industry, pledging to maintain sourcing operations despite suffering a Tk365 crore loss linked to its previous business relationship with Friedrich-Ebert-Stiftung (FES), the oldest political foundation in Germany.

The European retail giant, one of Bangladesh’s largest apparel buyers, currently ranks eighth among the country’s garment sourcing partners. It purchases more than $750 million worth of apparel from Bangladesh annually and works with more than 350 local manufacturers, supporting thousands of jobs across the supply chain.

LPP said it is currently owed Tk3.65 billion by FES, equivalent to around 1.1 billion Polish zlotys, making the company the party most severely affected by the financial fallout from its relationship with the local entity.

Despite the substantial financial setback, LPP said the dispute would not weaken its long-term partnership with Bangladesh. “Bangladesh is one of the key pillars of our global supply chain,” the company said.

LPP said it remains committed to continuing its sourcing operations, meeting all contractual obligations and maintaining stable and transparent relationships with Bangladeshi garment manufacturers.

“Despite being the party most affected by the FES-related issue, our priority remains ensuring the stability and long-term prosperity of Bangladesh’s garment sector and protecting the interests of the people working to advance this industry,” it said.

The retailer said it was dealing with the financial difficulties transparently while continuing to cooperate with local manufacturers and industry associations to ensure uninterrupted supply-chain operations.

The company’s continued sourcing commitment comes as a significant vote of confidence in Bangladesh’s RMG sector, which remains heavily dependent on major international buyers for export growth and employment.

LPP said its substantial presence in Bangladesh would continue to contribute to the local economy while strengthening the country’s role in the global apparel supply chain.

The company’s pledge also signals that the FES-related financial fallout has not altered its broader sourcing strategy in Bangladesh, despite the scale of the losses involved.