Center for Global Workers’ Rights (CGWR/Global Workers Rights Center) and Worker Rights Consortium (WRC/Worker Rights Alliance) recently released an import data analysis report. Based on a previously unpublished import database, these two American organizations analyzed the global clothing factories and suppliers from April to June this year. losses were estimated.
CGWR and WRC pointed out that the main sources of the database for this report include: apparel suppliers and their trade associations.
The report pointed out that starting in March, many large European and American fashion brands and companies canceled orders or refused to pay for orders placed before the epidemic due to the epidemic, resulting in global losses from April to June. Garment factories and suppliers lost $16.2 billion. The report pointed out that suppliers in Bangladesh, Cambodia, Myanmar and other countries that were affected had to reduce the scale of their operations or even close their doors directly. As a result, millions of workers have either been laid off or forced to shorten their working hours.
The report points out that the epidemic has exposed the power imbalance at the heart of the fashion industry, that is, the initial production costs are borne by suppliers from economically underdeveloped and even poor countries, while buyers are in factories. Payment is not made until weeks or even months after shipment. Scott Nova, director of WRC and co-author of the report, pointed out: “During the epidemic, the already unfair payment system has allowed Western brands to support their own financial situation by oppressing their suppliers in developing countries.”
The report stated that even though suppliers and workers are facing a life-and-death crisis, some retailers still choose to spend millions of dollars to pay shareholder dividends. In March this year, the American clothing retail giant Kohl’s distributed a total of US$109 million in dividends to shareholders, weeks after canceling large orders from factories in Bangladesh, South Korea and other countries.
The Garment Manufacturers Association of Cambodia published an open letter in April this year, calling on buyers to fulfill their contracts to protect the livelihoods of 750,000 Cambodian garment industry workers. “All relevant stakeholders in the global apparel supply chain are overwhelmed by the epidemic. However, compared with buyers, manufacturers (factories) have slim profits and weaker pressure-bearing capabilities. In the end, they are already living on the subsistence line. workers, the living environment is even more severe.”
The open letter also pointed out that the total value of canceled orders in Bangladesh is 2.5 billion pounds, and the buyers mainly include Arcadia (the parent company of Topshop) , spring and summer collections from clothing retailers such as Debenhams, Asda, Peacocks, New Look and Sports Direct.
CGWR data shows that more than 1 million Bangladeshi garment workers have been laid off or temporarily laid off due to brands and retailers canceling orders or refusing to pay for goods. Although the local government has provided a total of US$500 million in relief funds to factories to reduce unemployment, many reports indicate that Bangladeshi workers have been without income for at least two months.
In July this year, Rubana Huq, president of the Bangladesh Garment Manufacturers and Exporters Association, said that new orders dropped by about 45% compared with the same period last year. . Factories in Bangladesh, the world’s second-largest clothing producer, are operating at half their usual capacity.
Recruitment agencies for apparel companies in Vietnam, a major manufacturer of large sportswear brands such as Nike and Adidas, are also facing difficulties. Recruitment consultant Will Tran told Reuters that he and his colleagues had only signed two hiring orders in April and May, compared with usually as many as 10 orders per person. He said: “So 80 to 90% of the job requirements disappeared with a ‘pop’.”
Professor Mark Anner, director of CGWR and lead author of the report, pointed out that the financial performance of clothing companies The situation has been affected by the epidemic, but we must face due financial responsibilities. “Although being at the top of the supply chain allows (brands and retailers) to renege on their contracts with suppliers when facing a crisis, morally we should protect the weak…The most basic thing is to protect the rights of workers at the bottom of the supply chain. .”
In order to urge brands and retailers to take responsibility, WRC and CGWR launched an “epidemic tracker” in April this year to monitor whether companies have fulfilled their contractual obligations. Arcadia Group, the parent company of British high street brand Topshop, retail giant Walmart, American fashion retailer Urban Outfitters, British maternal and infant clothing retailer Mothercare, etc. have not promised to pay the full price for orders that have been completed or are in production.
In addition, Scott Nova pointed out that under the influence of labor unions and media reports, brands and retailers such as Gap, H&M, and Zara have successively announced that they will pay orders in full. Previously, Japanese fast fashion giant Uniqlo also stated that it would pay for goods as usual during the epidemic.
From September 5th to 25th, the International Textile Federation conducted the fifth survey on its members, affiliated companies, associations and other 216 companies from all over the world. Investigation on the impact of the epidemic on textile enterprises. The survey shows that these companies’ forecasts of turnover�There has been significant improvement since the 4th survey.
This survey adds for the first time a survey on revenue expectations from 2020 to 2024. Looking at the global average, turnover in 2020 is expected to be 16% lower than in 2019. In 2021, the global textile industry is expected to stagnate (-1%). In the coming years, companies expect to see higher turnover than in 2019. Compared with the base year 2019, turnover levels are expected to increase by 9% in 2022, 14% in 2023 and 18% in 2024. It will not be until 2024 that the global textile industry can fully make up for the losses caused by the impact of the epidemic in 2020.
China announced a tariff reduction on Cambodian clothing!
On October 12, Minister of Commerce Zhong Shan and Cambodian Minister of Commerce Pan Sosa represented the Chinese and Cambodian governments in Beijing and Phnom Penh respectively, and formally signed the “People’s Republic of China” through video. and the Royal Government of Cambodia” (hereinafter referred to as the China-Cambodia Free Trade Agreement).
This agreement has reached the highest level of China’s free trade agreements in terms of liberalization of trade in goods and access to service markets. Cargo. China has granted Cambodia zero-tariff tariffs on 97.53% of its goods trade, and Cambodia has granted China zero-tariff tariffs on 90% of its goods trade. This is the highest level in all free trade agreement negotiations between the two sides to date. In terms of services, the market opening commitments in the China-Cambodia Free Trade Agreement reflect the highest level provided to their free trade partners by each country.
According to the agreement, China will include Cambodia’s key products such as clothing, footwear, leather and rubber products, mechanical and electrical parts, and agricultural products into tariff concessions. Cambodia has included textile materials and products, mechanical and electrical products, miscellaneous products, metal products, transportation vehicles and other products that China is focusing on into tariff concessions.
This agreement has set many “firsts”: it is the first free trade agreement signed between China and the least developed countries, and it is the first to integrate the “One Belt, One Road” “The free trade agreement that advocates cooperation and independent chapters is also the first free trade agreement China negotiated and signed after the outbreak.
It is worth noting that the negotiation of this free trade agreement lasted only seven months: the two parties launched negotiations in January 2020, and after three rounds of formal negotiations, the agreement was concluded in July 2020. It was announced on the 20th that the negotiations had been completed. In the next step, China and Cambodia will each carry out domestic legal approval procedures and promote the early entry into force of the agreement. </p
