News

The government of Bangladesh has granted permission to the Accord on Fire and Building Safety to continue operating in the country beyond May of 2018. This comes just weeks after a Bangladesh court denied the Accord permission to continue its work because it said the group had not sought proper government approval to do so. The Accord says it intends to continue its work in the country until such time that local groups have “full capacity to inspect factories, compel remedies, and protect workers.” (Fibre2Fashion)
 
An ongoing gas shortage in Bangladesh has hampered the production of over 350 factories in Gazipur, Ashulia, Savar, and Kashimpur. The crisis ignited following the failure of two wells in the Shahjibazar Gas Field in Brahmanbaria. Factory owners and operators say the crisis is affecting their productivity and ability meet delivery deadlines, with some resorting to expensive air freight to meet their promises to customers. (The Daily Star)

Authorities in China have shut down an estimated 40% of all the country’s factories at some point over the past few months in order to undergo government-mandated environmental inspections. Over 80,000 of those facilities have been hit with fines and criminal offenses for environmental violations found. The effort is part of an unprecedented crackdown on pollution in the country, though many factory owners are complaining that the inspections are slowing their production lines and causing them to miss deadlines and make other errors. (Forbes)

A delegation from India’s Apparel Export Promotion Council (AEPC) recently conveyed concerns expressed by Indian garment exporters over the new Goods and Services Tax scheme (GST). AEPC leaders said that the GST is “burdensome” and “stressful” to many small and medium enterprises due to increases in working capital and higher transaction costs, among other factors. The group notes that higher business costs in India could make the country less competitive compared to other Asian nations like Bangladesh and Vietnam. (Fibre2Fashion)
 
A major fire broke out at a multistory hosiery production unit in Ludhiana during the early morning hours of October 24. Firefighters say it took them over 10 hours to douse the flames and while the building suffered severe structural damage, no major injuries have been reported. The cause of the blaze remains under investigation. (Hindustan Times)

Myanmar’s garment exports are likely to top US$3 billion this fiscal year, according to new data from the Myanmar Garment Entrepreneurs Association (MGEA). The European Union is the top buyer of garments from the country, followed by Japan and South Korea. Garments account for an estimated 16% of the country’s total exports. (Fibre2Fashion)

A new study from Spanish sustainable textile group Renewable Resources says that global garment manufacturers waste an estimated 25% of their input resources each year. The report says the problem is a symptom of conflicting business interests facing many facilities as well as a lack of data and transparency between stakeholders within global supply chains. The group suggests that huge opportunities exist to integrate much of this waste back into the production line to reduce overages. (Fibre2Fashion)

Over 3,000 migrant workers from Myanmar working at a Thai footwear factory recently staged a protest against their employer after the company allegedly took 12,500 Thai Baht (US$375) from their paychecks to pay for their Certificates of Identity (CI). Thai labor authorities say they facilitated a meeting between the workers and factory management after the demonstration in which the factory owners agreed to charge the workers less for their certificate renewals. The migrant workers must hold valid CIs in order to work in Thailand. (Eleven Myanmar)

Several major U.S. apparel and textile trade bodies have come together to launch a new initiative aimed at educating policymakers about the economic impact that the textile and apparel industry has on the United States. The “U.S. Global Value Chain Coalition” will advocate, educate, conduct research, and engage on policies that support American employees and their families through global value chains. The initiative is being backed by groups like the American Apparel and Footwear Association (AAFA), the U.S. Fashion Industry Association (USFIA), the National Retail Federation (NRF), and the Retail Industry Leaders Association (RILA). A recent report by the group found that the U.S. adds as much as 75% value to the final retail price of imported clothing, making the U.S. position in the global world of trade more important than ever. (Fibre2Fashion)
 
A group of major retailers and apparel trade groups have come together to launch a new initiative aimed at galvanizing “collective action in the apparel and footwear industry” and to help drive sustainability in the sector. The “Apparel Impact Institute (AII)” will work with brands and manufacturers to select, fund, and scale projects that help improve the sustainability of the garment sector. The AII is being supported by the Sustainable Apparel Coalition, the Sustainable Trade Initiative, and a host of major brands including Target and Gap. (Fibre2Fashion)
 
New data from the Footwear Distributors and Retailers of America (FDRA) says that rural Americans are spending record amounts on footwear. The group says that rural Americans now spend a near-record US$383 per year on shoes, nearly equal to suburban and urban shoppers. FDRA President & CEO Matt Priest credits e-commerce with helping to fuel this trend and that the data shows that more Americans are willing to buy footwear online than ever before. (Vamp Footwear)

The Bangladesh Readymade Garment Manufacturers and Exporters Association (BGMEA) is pushing the government to withdraw the “tax at source” for the industry over the next 2 fiscal years and asking for a reduction in the corporate tax rate to 10% from the current proposal of 15%. BGMEA officials say the moves are necessary to ensure the ongoing health of the industry and to help it stay globally competitive. The group says that global events like the devaluation of the Euro and the “Brexit” decision have driven their costs up. (Fibre2Fashion)

China’s government rejected a request made by the U.S. State Department to release three labor activists detained last week while investigating a factory that produced footwear for the fashion brand of Ivanka Trump, daughter of U.S. President Donald Trump. Chinese officials say they instead want to enforce a “cone of silence” around the detainees and admit that they have also questioned the wife of one of the detainees. (Associated Press)

A recently-imposed restriction on the sale of cows and buffalo for slaughter has raised concerns both from local leather producers in India and the international apparel brands who source leather from the country. Late last month, Prime Minister Narendra Modi’s government issued a decree saying that cattle could only be sold for agricultural purposes like plowing or dairy production and could not be sold to produce meat or leather. Many companies that source from India’s massive leather industry have already announced plans to move their sourcing elsewhere, making many producers nervous about the future of the sector. (Times of India))

A new report has been released publishing the findings of a multi-year study looking at how to reduce child labor in the supply chains of apparel companies doing business in The Netherlands. The investigation was initiated in 2015 by the Dutch multi-stakeholder “Working Group on Child Labor” and looked at the supply chain practices of 7 companies who sourced from Turkey and sold products in The Netherlands. The group says that confronting child labor will require collaborative efforts from all involved to accurately map supply chains in a trustworthy and transparent way.(Sourcing Journal)

Pakistan has been named the 4th most dangerous country in the world for tourists by the World Economic Forum’s Travel and Tourism Competitiveness report which assesses the stability of the tourism and travel sectors in 136 countries around the world. The report cites an ongoing risk of attacks by extremists, especially toward foreigners, as rationale for the ranking. Colombia was cited as the most dangerous country followed by Yemen and El Salvador.(The Express Tribune)

Apparel industry leaders in Sri Lanka say that while the recent floods and landslides that have beseiged the country in recent weeks may hamper their ability to honor current orders in the short-term, the country’s long-term production capabilities should not be affected. Speaking to Just Style, Anil Wettewa, the head of the Sri Lanka Apparel Sourcing Association, expressed confidence in the country’s ability to bounce back, noting that there is “nothing too serious” facing the industry. Sri Lanka was inundated with floods last month by a strong monsoon. (Just Style)

Swedish fashion retailer Lindex has launched a 3-year project aimed at creating greater gender equality and inclusiveness for women working in its supply chain. The “WE Women by Lindex” effort will focus on educating and equipping suppliers around the world to plan, execute, and evaluate business operations from the perspective of gender equality. The project is being run in collaboration with German international development agency GIZ. (Just Style)

The International Labor Organization (ILO) says it plans to establish a “Global Business Network on Forced Labor and Human Trafficking” to help businesses address these issues in an increasingly complex world. In a statement, the ILO noted that the venture would provide participants with “hard-to-find data and information” on emerging trends in the aforementioned areas to help them proactively adapt. The effort has already gained praise from many groups around the world and received funding from organizations like Mars, Inc. and the U.S. Department of Labor. (ILO )/(Just Style)

An executive with an American robotic apparel manufacturing equipment company says that the the industry’s current model of manufacturing overseas where labor costs are low then importing those products back to Western markets was broken from outset and that robotic apparel manufacturing would allow the industry to sever its reliance on this model and bring production closer to consumers. Speaking at last month’s Texprocess trade show, Pete Santora of Georgia-based SoftWear Automation said that the world is quickly running out of locales to supply labor at costs demanded by modern apparel companies and that robotic manufacturing could hold the key to a more sustainable model. He notes that mechanized manufacturing would allow companies to lower their costs and cut back on overhead like international shipping. (Just Style)
 
New data from the U.S. Office of Textiles and Apparel (OTEXA) says that the volume of U.S. apparel imports increased by 4.7% year-on-year in April, though the value of imports decreased by 0.9% for the same term. While two of the top 10 supplier nations of U.S. apparel, China and Vietnam, increased their shipments year-on-year, four others, including Bangladesh, recorded year-on-year declines. (Just Style)
 
Organic fiber sales in the United States set a new record last year at US$14 billion, according to new data from the Organic Trade Association. The group says that the organic fiber and textile market is the largest non-food organic market in the United States, accounting for nearly 40% of the estimated US$3.9 billion in organic non-food sales. (Sourcing Journal)
 
The Washington, DC-based World Bank Group says that global economic growth will strengthen to 2.7% this year thanks to an uptick in manufacturing and trade, rising market confidence, and stabilizing commodity prices. The group’s latest “Global Economic Prospects” report says that growth in advanced economies will also help trading partners of those countries. (Financial Times)
 
The Fashion Institute of Technology (FIT) recently hosted their Summer Institute which included a panel about how brands can foster a more circular apparel economy with eco-friendly practices. One of the panelists representing the Eileen Fisher brand noted a growth in apparel take-back programs, including their own, in which stores offer drop-offs for unwanted apparel items to be recycled or reused instead of thrown in the trash. Other proposals included programs that repair damaged items like denim jeans. (Sourcing Journal)
 
The University of Massachusetts at Lowell says it has received a US$11.3 million grant from the state government to open a “Fabric Discovery Center” which will be focused on researching new modern fabrics and manufacturing methods. University officials say that the move honors the campus’ and the state’s heritage as a textile manufacturing center while also pushing the state’s economy forward. The Lowell campus was created from the Lowell Textile Institute which was founded in 1895 during the height of the state’s textile industry. (Boston Globe)

The Vietnam Textile and Apparel Association (VITAS) says that the country’s garment industry has to import upwards of 86% of their raw fabrics. VITAS says most of this supply comes from other Asian nations like China. They also admit the necessity for reducing their reliance on imported materials, most notably to comply with origin rules of major trade deals. (Vietnam Net)

The Supreme Court of Bangladesh has dismissed a petition to review a 2016 appellate court ruling upholding a 2010 decision saying that the headquarters building of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) is illegally built and must be torn down. Court documents say that the 15-story building blocks the connection between two major bodies of water in Dhaka and was constructed without some necessary government approvals. The court is asking the BGMEA to bear the cost of the demolition and is asking for the group to submit a plan to carry it out. (Dhaka Tribune)

Twenty disabled female women recently traveled to Phnom Penh from the Kampong Speu province to urge the government to investigate their allegation that they were fired from a garment factory last month without cause. A spokesperson for the workers say that they were forced by the factory to accept a severance package last month after factory managers said financial pressures were forcing them to make cuts. A representative for the factory denied that the dismissals were discriminatory but refused to provide an alternate reason. (Phnom Penh Post)

A textile factory in China has set up the country’s first wastewater treatment plant that uses radiation to clean dirty water. The facility is part of a pilot project facilitated by the International Atomic Energy Agency (IAEA) testing better methods for water treatment. IAEA representatives say that radiation is the only method that can treat some of the most stubborn pollutants in wastewater. (Fibre2Fashion)

The government of India is reviewing the Scheme for Integrated Textile Parks (SITP) after a recent report commissioned by the Ministry of Textiles claimed that the scheme has failed to achieve its objectives. The report, published by Wazir Advisors, cites a number of reasons for SITP’s poor performance, including high rents in textile parks, insufficient marketing, and poor accessibility. The report suggests consideration of a new scheme that would center on larger parks. (Fibre2Fashion)

Work has resumed at a Myanmar factory after it sustained US$75,000 in damages from a violent strike last month. The strike reportedly ensued following news that a union leader had been fired from the facility. The strike ended on February 25 after local officials in Myanmar ordered that the union leader be reinstated. (Frontier Myanmar)

Sri Lanka’s Prime Minister Ranil Wickremesinghe says the country needs to focus on diversifying its exports away from just textiles and garments if it wants to remain globally competitive. He noted that the country is facing increasing competition from nearby states like Bangladesh where wages are significantly lower than in Sri Lanka. Wickremesinghe says that electronics and robotics could present new export opportunities. (Fibre2Fashion)

Swedish fashion company H&M says it is encouraging its global suppliers to begin paying their workers digitally in order to improve transparency and worker well-being. The announcement comes after the company joined the “Better Than Cash” initiative of the United Nations which advocates for digital and mobile banking. Company executives say that digital payments will not only increase security and transparency, but will also increase financial inclusion among workers in developing nations. (Fibre2Fashion)

The World Federation of the Sporting Goods Industry (WFSGI) says that it has opened up its Responsible Sport Initiative (RSI) audit sharing initiative to companies outside of the sporting goods industry. First launched last year by bicycle companies in the WFSGI, the RSI enables sharing of audits conducted by third-party providers approved by the RSI. (Think Sport)

British risk analysis company Verisk Maplecroft has released its latest “Human Rights Outlook” describing the top human rights risks to businesses in 2017. The company says that a tightening of U.S. immigration policies under President Donald Trump could grow the risk of slavery and labor abuses against undocumented workers in the country as they are forced “under the radar.” The report also indicates a greater risk for slavery “blind spots” in areas like shipping, cleaning, and security. (CNBC ) / (Verisk Maplecroft)

A new report from Moody’s Investors Service says that while operating profits for the U.S. apparel and footwear industry are poised to improve over the next 12-18 months, growth will be more sluggish that originally anticipated. The report notes that many companies are still feeling pressured by the strengthening value of the U.S. dollar coupled with a decline in retail traffic. The company also says that while many larger retailers may be able to offset this trend through growth abroad, those that focus just on the U.S. may continue to struggle long-term. (Fibre2Fashion)

The International Finance Corporation (IFC) is launching a new program in Uzbekistan aimed at helping cotton farmers improve their efficiency, safeguard the environment, and improve labor practices. The IFC says the effort is aimed at helping one of the country’s most crucial industries become more sustainable and respected around the world. While Uzbek cotton is often praised for its quality, the country has been frequently accused of engaging in labor and environmental abuses during the harvest. (Fibre2Fashion)

Better compliance across Bangladesh’s garment sector could increase readymade garment exports by nearly 10%, according to a new international report released by the Copenhagen Consensus Center and BRAC. The report noted that greater compliance reduces the probability of workplace accidents and cuts back on employee turnover, both of which can contribute to higher productivity. (Financial Express) / (Copenhagen Consensus Center)

Questions are being raised about the health of Cambodia’s garment industry following news of a higher than usual number of factory closures last year. Cambodia’s Ministry of Labor said that it documented 141 factory closures last year, nearly double the amount recorded in 2015. Ministry officials also say they recorded 149 factory openings for the same period. While some observers say the large number of closures may be cause for concern, others say the greater number of openings means the industry is doing well. (Phnom Penh Post)