SWEDEN: H&M eyes "opportunities" in sub-Saharan Africa
According to Dagens Industri, H&M plans to undertake a survey of production opportunities in Africa
Swedish fashion giant Hennes & Mauritz has said it sees "good opportunities" for producing apparel in sub-Saharan Africa.
Speaking to Swedish business daily Dagens Industri, H&M CEO Karl-Johan Persson, said the company had started producing on a small scale in Ethiopia and that it will now "see how it goes", describing the potential opportunity to expand further as "very interesting".
According to Dagens Industri, H&M plans to undertake a survey of production opportunities in Africa this spring, one of which may be in South Africa where it plans to open its first store next year.
Persson, however, said there "won't be dramatic changes" in the distribution of production in the short term, but there "may be bigger changes" in the long term. "It depends on how prices, quality and lead time develop," he told the publication.
A spokesperson for H&M did not comment directly on Persson's comments. A statement read: "We are a growing global company and we need to constantly look at how we can ensure that we have the capacity to supply products to all our stores where we have expanded rapidly. We do that as we increase production in existing production markets but also by looking at new ones. So far we have only placed test orders in Ethiopia as we always do before we go into a new purchasing market."
Such a move by H&M would reduce its reliance on countries like Bangladesh, which is experiencing election unrest that has disrupted the garment sector.
At present, H&M sources the majority of its garments from factories in Asia, particularly Bangladesh, where the Rana Plaza factory collapse last year killed more than 1,100 people. This has put pressure on large manufacturers to improve safety conditions for workers.
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