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News Clips 31 October, 2013


[ PRGMEA urges govt to release stuck-up refund claims ]
[ Bangladesh to decide garment wage rise amid unrest fears ]
[ US textile & apparel exports grow 3.52% in Jan-August 2013 ]
[ Retailer sandblasting bans have changed little in the garment industry ]

PRGMEA urges govt to release stuck-up refund claims   [ top ]

Daily Times, October 31, 2013
KARACHI: The Pakistan Readymade Garments Manufact-urers and Exporters Association (PRGMEA) has earnestly called upon the government to release stuck up refund claims accumulated into billions of rupees.

In a SOS sent to Prime Minister Nawaz Sharif, Finance Minister Ishaq Dar and Commerce Minister Khurram Dastagir, PRGMEA Acting Chairman Amir Amin Kothawala appealed to look into this serious matter in order to release exporters money which has been held up by the Ministry of Finance for the last several years and has now reached Rs 40 billion against refund claims of Duty Drawback of Local Taxes and Levies (DLTL), sales tax and with the customs.

The government of Pakistan announced the scheme regarding DLTL in 2009 for the exporters, in which 3.0 percent was share for the garment sector, besides additional 1.0 percent drawback was promised to exporters who will achieve an increase of 15 percent in exports, this was never announced. Though the period has been expired in June 2011 but our exporters are waiting for their reimbursement against DLTL.

“The stuck up capital of the exporters has accumulated to around Rs 40 billion in terms of DLTL, sales tax and customs while the sector’s stuck-up claims are Rs 9-10 billion alone in terms of DLTL,” Kothawala said adding that due to these stuck-up payments the exporters are facing acute liquidity crunch.

“Now, we are going to prepare ourselves for the GSP Plus status from EU expected to start by early next year but we have to fulfil some conditions for the preferential status. No support is being provided to this vital sector and the exporters are facing severe problems in negotiating orders with EU buyers due to financial crunch,” he added.

He said that on one hand exporters are being pushed to enhance our declining exports in adverse market conditions while our rightful dues are being withheld, how can we be expected to finance our operations when we don’t have the required funds, he questioned.

He urged upon power corridors in Islamabad to resolve this important issue on priority basis in order to save crippling exports.

Bangladesh to decide garment wage rise amid unrest fears   [ top ]

Agence France-Presse, October 30, 2013
A government panel was striving Wednesday to reach agreement on a wage rise for Bangladesh’s crisis-hit garment industry, amid warnings of fresh crippling strikes if the increase is too low.

The panel is trying to set a new minimum wage for four million garment workers, after factory disasters in recent months killed more than 1,000 people and highlighted the industry’s appalling pay and conditions.

The government pledged to raise wages by November, based on the Minimum Wage Board’s recommendation, after strikes last month saw hundreds of thousands of workers take to the streets, torch factories and clash with police to demand an increase.

“We expect to reach a final decision tomorrow,” M. Kamaluddin, a member of the six-person panel, told AFP.

However he said negotiations within the panel — which includes union officials and factory owners — were still continuing over how much to increase the current monthly wage of 3,000 taka ($38), which was last raised in 2010.

“Both sides have to make some concessions so that we can find a solution,” Kamaluddin said.

Bangladesh is the world’s second largest clothing exporter and the industry is a mainstay of the economy. But wages are well below those in other major garment-making nations such as China, Vietnam and Cambodia.

The collapse of the Rana Plaza factory complex in April that killed 1,135 people in one of the world’s worst industrial disasters sparked pledges from leading Western retailers and the Bangladeshi government of improved conditions.

Owners’ representative Arshad Jamal Dipu told AFP that manufacturers were “ready to hike wages by around 50 percent”.

But union official Sirajul Islam Rony warned of fresh protests if owners did not agree to more than double the monthly wage to 8,114 taka.

“No way we’ll agree a 4,500 taka minimum wage. The owners must offer more, otherwise workers will hit the streets again,” he told AFP.

Dipu said many factories could not afford to raise wages further than the current offer, pointing to a slump in orders from Western retailers.

Some factories have also been forced to spend heavily to fix fire and building safety problems at their factories following the Rana Plaza and other disasters.

The government of Prime Minister Sheikh Hasina, already facing down mass opposition rallies and protests, can ill afford another series of strikes ahead of elections.

Sources said Hasina might intervene at the last minute to fix a figure that pleases unions — in an effort to woo voters in the country’s largest workforce ahead of January elections.

The Minimum Wage Board’s recommendation for a new wage must be approved by the government before becoming law.

Protests over poor wages, benefits and working conditions are frequent in Bangladesh but have gained in intensity since the April disaster.

Manufacturers and police said strikes in September hit production at more than 500 garment factories — where clothes are made for top retailers such as Tesco and H&M — costing owners some $40 million.

US textile & apparel exports grow 3.52% in Jan-August 2013   [ top ]

Fiber2Fashion, October 30, 2013
The value of exports of textiles and apparel from the United States grew at 3.52 percent year-on-year to $ 15.766 billion during the first eight months of the current year, according to the data from the Office of Textiles and Apparel (OTEXA), Department of Commerce.

Of this, the value of apparel exports registered$ 3.779 billion, registering a growth of 2.97 percent year-on-year, while exports of textile mill products grew by 3.7 percent year-on-year to $ 11.986 billion, according to the data.

Among the textile mill products, fabric exports from the US rose by 4.43 percent year-on-year to $ 6.011 billion, while yarn and made-up articles exports increased by 2.24 percent and 4.03 percent to $ 3.516 billion and $ 2.458 billion, respectively, during the eight-month period.

Of the total textile and clothing exports made by the US in January-August 2013, NAFTA countries accounted for $ 7.323 billion, while CAFTA-DR countries accounted for $ 2.099 billion and EU-28 for $ 1.701 billion.

In 2012, the US textile and garment exports stood at $ 22.676 billion, of which, textile mill products earned $ 17.137 billion and apparel fetched $ 5.539 billion.

The US imports greater quantity of textiles and apparel for its domestic market compared to its exports, and during the first seven months of 2013, the country imported textiles and clothing worth $ 59.014 billion, according to the Major Shippers Report.

Apparel constitutes a major part of the US imports, and during January-July 2013 period, the country imported clothing valued at $ 44.701 billion, while non-apparel imports accounted for $ 14.313 billion.

Retailer sandblasting bans have changed little in the garment industry   [ top ]

Contra Costa Times, October 28, 2013
Three years ago, when Levi Strauss announced it had banned the use of sandblasting, labor advocates hoped the move by the top-selling jeans maker would help end the deadly practice, which gives denim a fashionable look but is linked to a fatal lung disease.

But even as Target and Gap joined Levi Strauss in proclaiming bans, sandblasting persists in factories that make those retailers' clothes in China, India, Pakistan, Egypt and Bangladesh, countries responsible for the bulk of the five billion pairs of jeans made each year, research by nonprofits, medical groups and labor organizations shows.

"There clearly is sandblasting going on. I don't know how anyone could really deny it," said Katie Quan, associate chair of the Labor Center at UC Berkeley.

Counterfeit jean production, outsourcing in the supply chain and vast factories that make jeans for dozens of brands under one roof make it difficult to track jeans from production to the shopping mall. But the groups say their research establishes that workers in many of these overseas factories are sandblasting -- spraying sand on denim to make it appear bleached or distressed -- without the necessary protective gear.

Levi Strauss says its suppliers have removed sandblasting equipment from their factories and that it regularly conducts on-site inspections at factories.

"No Levi Strauss & Co. products utilize sandblasting in product development, design, finishing or in any other aspect of garment production," said a Levi Strauss spokeswoman who asked not to be named. "We do not request nor allow sandblasting at the supplier level."

Although Levi Strauss still sells bleached and distressed looking jeans, the company says none of the styles requires sandblasting. And the company inspects all clothes before they reach stores to make sure that they haven't been sandblasted, according to the spokeswoman.

"The look and feel of denim ... is noticeably different," she said.

The disconnect between what retailers say happens in the factories and what labor groups report foreshadows immense challenges for other garment industry reform efforts, such as those now under way in Bangladesh following a factory collapse in April that killed more than 1,100 people. The garment industry is built on a vast network of subcontractors hidden from regulatory oversight, experts say, so that even well-meaning fashion brands are unable to change the conditions in which their clothes are made.

"There is no such thing as a non-sweatshop in the global supply chain," said Garrett Brown, coordinator of the Berkeley-based Maquiladora Health & Safety Support Network, a collection of occupational health and safety professionals who educate factory workers about workplace hazards. "Retailers have almost no ability to know where it's being done, by whom it's being done and with what technology, and as a consequence they have no idea the terrible stuff that's going on."

The Clean Clothes Campaign, an international organization advocating for garment workers, recently interviewed workers in six factories in an industrial region of China that produces about half the world's jeans, and laid out the findings in a report this summer. The organization found that five of the factories -- employing a combined 8,000 workers -- still use sandblasting. The largest one makes clothes for Levi Strauss, Gap and its sister brand Old Navy. Gap said it banned sandblasting in 2011.

Sandblasting was also discovered at a factory with 300 workers that makes clothes for Levi Strauss. And two factories make jeans for Wrangler, a brand sold at Target, which banned sandblasting last year.

Of the six factories, only one -- also a Levi Strauss supplier -- had eliminated sandblasting because it "has essentially outsourced these processes" to another factory, according to the report.

"The impact of the ban has been patchy, poorly monitored and widely circumvented," said Dominique Muller of the Clean Clothes Campaign. "We discovered that regardless of whether a brand has banned sandblasting or not, manual sandblasting still takes place, often at night to avoid detection by audits."

Target spokeswoman Jessica Deede said the retailer regularly audits factories it works with and if it finds sandblasting, Target may cut ties with those factories for at least three years.

"We clearly communicate our sandblasting ban with national brand partners, such as Wrangler," Deede said.

Levi Strauss, a leading Bay Area retailer widely considered one of the most socially responsible brands, became the first U.S. apparel brand to announce a ban on sandblasting. The World Health Organization, U.S. Centers for Disease Control and Prevention, National Institute for Occupational Safety and Health and California Department of Public Health have all warned about the health risks of sandblasting.

Workers can develop silicosis, an incurable disease that scars the lungs and can cause cancer, chronic pain, coughing, shortness of breath and heart failure. Gregory Härtl of the World Health Organization said silicosis is one of the oldest known occupational diseases, yet it still kills more than 8,800 workers worldwide each year.

There are other methods, including chemical sprays and washes, that give denim a distressed look. But industry experts say the alternatives tend to also be risky, more expensive and slower than sandblasting, and may eat away at a factory's razor-thin margins. Sandblasting can be done safely with protective gear -- the practice has been used for years in the U.S. for industrial purposes such as cleaning pipes and bridges -- but many garment workers wear only a rag around the mouth, sleep in the factories, and have no relief from the dust, Brown said.

None of the factories in China where sandblasting was discovered provided workers with adequate safety equipment, Muller said.

Safety inspections are often ineffective because workers are coached on what to say to auditors, and managers hide sandblasting equipment and in some cases set up fake factories, said Annabel Meurs of Fair Wear International, a nonprofit in the Netherlands that works with retailers to improve factory conditions.

"Most brands have no clue," Meurs said.

One of Levi Strauss' suppliers in China, Dongguan Golden City Washing, Sandblast and Brush Factory, continued sandblasting after the ban, with workers hiding the machines during audits. Levi Strauss discovered the covert operation in 2011 and cracked down on the factory; in January 2012 factory management "sent photos as proof" that the sandblasting equipment had been removed, a Levi spokeswoman said.

However, in October 2012, about nine months after Levi Strauss received the photos, workers disclosed to the Clean Clothes Campaign they were dismantling and hiding manual sandblasting machines from inspectors. Levi Strauss lists Dongguan Golden City as a current supplier.

Still, Levi Strauss' ban has helped, said Muller of the Clean Clothes Campaign. The company brought scrutiny to a practice that had continued mostly uninterrupted for nearly two decades. About 40 brands now have bans, adding pressure to factory managers to end unsafe labor practices.

But critics demand more -- they say clothing brands must stop designing the vintage styles that made sandblasting popular in the first place. Yet the style, which took off in the 1990s, is still hugely popular; Deede says faded jeans are in high demand at Target. And according to the Trend Council, which forecasts global style trends for retailers, the top denim looks for 2014 include faded and splattered styles -- the very look often created by sandblasting.