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Sweet labour: From H&M to Calvin Klein, brands look to Ethiopian factories where pay is as low as $21 a month and no minimum wage July 22, 2015

Posted by OromianEconomist in H & M.
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“Ethiopia’s garment sector has no minimum wage, compared with Bangladesh, where workers earn at least $67 a month, according to the International Labor Organization. Garment workers in Ethiopia started at about $21 a month as of last year, the Ethiopian government said.”

From H&M to Calvin Klein brands look to Ethiopian factories with pay as low as $21 a month

From H&M to Calvin Klein brands look to Ethiopian factories with pay as low as $21 a month

Africa is one of the few places where it is possible to go from fiber to factory in one place and Ethiopia holds the maximum promise for garment retail, being a top sourcing destination for apparel companies with $70 billion of goods procured annually.

“Africa is a huge opportunity to demonstrate how the industry can work together,” said Colin Browne, managing director of product supply and Asian sourcing for VF Corp., which owns such brands as Lee, Wrangler and Timberland.

He pointed out to the factory owners a key advantage in Africa: it is one of the few places where it’s possible to go from fiber to factory in one place.

Africa is the final frontier in the global rag trade – the last untapped continent with cheap and plentiful labor. Ethiopia’s garment sector has no minimum wage, compared with Bangladesh, where workers earn at least $67 a month, according to the International Labor Organization. Garment workers in Ethiopia started at about $21 a month as of last year, the Ethiopian government said.

Most countries in Africa benefit from a free-trade agreement with the US, an arrangement that saves retailers money and ensures that many African countries can grow their own cotton, which shortens production time.

Asia has dominated clothing manufacturing, churning out cheap clothes on inexpensive labor that are shipped to malls world-wide. But, over the past few years, rising production costs in China and several deadly factory accidents have forced apparel companies to hunt for alternatives from Myanmar to Colombia to Ethiopia.

Ethiopia was recently identified as a top sourcing destination by apparel companies, according to McKinsey & Co, which surveyed executives responsible for procuring $70 billion of goods annually – the first time an African country was mentioned alongside Bangladesh, Vietnam and Myanmar.

Whether or not Africa’s role as a supplier expands, these efforts show the lengths to which big apparel makers are willing to go to find new, low-cost sources of production. Overall, consumers have become conditioned to expect a plentiful supply of cheap clothing.

“In the global economy, light manufacturing is constantly moving,” said World Bank’s Guang Z. Chen, who was the country director for Ethiopia until last month and is now a director for several countries across southern Africa. “We see a distinct possibility of this kind of industry moving away from Asia, because labor costs are rising in China rapidly.”

Ethiopia holds the most promise for developing garment production in Africa, factory owners and brands say.

“Ethiopia seems to be the best location from a government, labor and power point of view,” says M. Raghuraman, chief executive for corporate marketing and branding at Brandix Lanka Ltd., Sri Lanka’s largest clothing exporter, which is interested in Africa’s garment potential.

At the MAA Garment & Textile Factory in Northern Ethiopia, 1,600 workers spin cotton, dye fabric and sew it into T- shirts, leggings and other basics for international retailers like Hennes & Maurtiz, AB’s H&M chain, Tesco PLC, Asda Stores Ltd’s George label, and German clothing company Kik Textilien und Non-Food GmbH.

“Investors are coming here from Sri Lanka, Bangladesh, China, India and Turkey,” said Fassil Tadesse, chief executive of MAA’s parent company, Kebire Enterprises, and president of the Ethiopian Textile and Garment Manufacturers Association.

So far, Africa barely registers in the field of garment manufacturing. And, it will take years for any other country to seriously challenge China.

Many African countries lack roads to transport finished clothing, and landlocked Ethiopia doesn’t have a port. The workforce is untrained in sewing clothes. All of sub-Saharan Africa accounts for less than 1% of global clothing exports.

Some apparel companies remain interested despite those hurdles. They are drawn to the cheap labor and to the inexpensive power, which in many countries is the second-biggest factory cost after workers. The Ethiopian government is building a railway to the port in neighboring Djibouti to help exports leave the country more quickly.

Read more at:-

http://africamoney.info/from-hm-to-calvin-klein-brands-look-to-ethiopian-factories-with-pay-as-low-as-21-a-month/

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A major UK- and World Bank-funded development programme in Ethiopia may have contributed to the violent resettlement and evictions of the indigenous people January 20, 2015

Posted by OromianEconomist in Afar, Africa, Ethiopia's Colonizing Structure and the Development Problems of People of Oromia, Ethnic Cleansing, Free development vs authoritarian model, Gambella, H & M, Land and Water Grabs in Oromia, Ogaden, Omo, Omo Valley, Sidama, Southern Ethiopia and the Omo Valley, UK Aid Should Respect Rights, World Bank.
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Ethiopia: human rights groups criticise UK-funded development programme

Leaked World Bank report rejects claims from the Bank’s management that no link existed between their programme and villagisation
The Guardian, Tuesday 20 January 2015
Traditional homestead in Gambela
 
A major UK- and World Bank-funded development programme in Ethiopia may have contributed to the violent resettlement of a minority ethnic group, a leaked report reveals. The UK’s Department for International Development was the primary funder of a World Bank-run development project aimed at improving health, education and public services in Ethiopia, contributing more than £388m of UK taxpayer funds to the project. However, a scathing draft report of the World Bank’s internal watchdog said that due to inadequate oversight, bad audit practices, and a failure to follow its own rules, the Bank has allowed operational links to form between its programme and the Ethiopian government’s controversial resettlement programme. Multiple human rights groups operating in the region have criticised the Ethiopian government’s programme for violently driving tens of thousands of indigenous people, predominantly from the minority Anuak Christian ethnic group, from their homes in order to make way for commercial agriculture projects – allegations the Ethiopian government denies. Many of those resettled remain in poor conditions lacking even basic facilities in refugee camps in South Sudan. The leaked World Bank report, obtained by the International Consortium of Investigative Journalists and seen by the Guardian, rejected claims from the Bank’s management that no link existed between their programme and villagisation. According to the report, weak audit controls meant bank funds – which included over £300m from the UK’s Department for International Development – could have been diverted to implement villagisation. The report did not itself examine whether the resettlement programme had involved human rights abuses, saying such questions were outside its remit. However, the watchdog highlighted a series of failures in the planning and implementation of the programme, including a major oversight in its failure to undertake full risk-assessments as required by bank protocol. Crucially for the Anuak people, the bank did not apply required safeguards to protect indigenous groups. Anuradha Mittal, the founder of the Oakland Institute, a California-based development NGO which is active in the region, said DfID was an active participant in the programme, and should share responsibility for its failings. “Along with the World Bank and other donors, DfID support constitutes not only financial support but a nod of approval for the Ethiopian regime to bring about ‘economic development’ for the few at the expense of basic human rights and livelihoods of its economically and politically most marginalised ethnic groups,” she said. Mittal was also critical of the World Bank panel’s draft findings, falling short of directly implicating the World Bank and its fellow donors in the resettlement programme. “It is quite stunning that the panel does not think that the World Bank is responsible for villagisation-related widespread abuses in Ethiopia resulting in destruction of livelihoods, forced displacement of Anuaks from their fertile lands and forests.” Disclosure of the draft report’s findings come as the UK government faces increasing scrutiny over its involvement in villagisation. DfID is the project’s largest donor and in March ministers will face a judicial review over whether the UK’s contributions indirectly funded the resettlement programme. The case has been brought by a farmer from the Gambela region who claims he was violently evicted from his land. Responding to the report’s findings, David Pred of Inclusive Development International – the NGO which filed the original complaint on the Anuak group’s behalf – said: “The Bank has enabled the forcible transfer of tens of thousands of indigenous people from their ancestral lands. “The Bank today just doesn’t want to see human rights violations, much less accept that it bears some responsibility when it finances those violations.” A World Bank spokesman declined to answer the Guardian’s questions about the report. “As is standard procedure, World Bank staff cannot comment on the results of the inspection panel’s investigation until the executive board of the World Bank Group has had the opportunity to review the panel’s report over the coming weeks.” In previous statements the bank’s management said there was no evidence of widespread abuses or evictions. Asked about the findings, a DfID spokesman said: “We do not comment on leaked reports. “Britain’s support to the Promotion of Basic Services Programme is specifically for the provision of essential services like healthcare, schooling and clean water, and we have no evidence that UK funds have been diverted for other purposes.”   http://www.theguardian.com/world/2015/jan/20/ethiopia-human-rights-groups-development-programme-world-bank-villagisation

Is H&M Turning a Blind Eye to Land Grabs in Ethiopia? A TV4 Investigation November 30, 2014

Posted by OromianEconomist in African Poor, Colonizing Structure, Corruption in Africa, Ethiopia's Colonizing Structure and the Development Problems of People of Oromia, Afar, Ogaden, Sidama, Southern Ethiopia and the Omo Valley, H & M, Land Grabs in Africa, Land Grabs in Oromia, The Tyranny of TPLF Ethiopia.
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OLand grab inOromia

 

Is H&M turning a blind eye to land grabs in Ethiopia? TV4 does an investigation into H&M’s cotton sourcing from Ethiopia and discovers the disturbing truth.