Cambodia’s shift to coal power projects is putting apparel brands off sourcing from the country.
A letter addressed to the Cambodian government, cited in the Nikkei Asian Review, shows several major companies including Adidas, H&M, Puma and Gap, have expressed concern about the country’s plans to nearly triple the amount of power it generates from coal in coming years.
In the letter – set to also be delivered to authorities this month – the companies warned that Cambodia’s pursuit of new fossil-fuel power projects, instead of embracing renewables like solar and wind, clashed with their corporate targets to reduce carbon emissions, the Nikkei Asian Review reports.
“Electricity decisions made today will lock Cambodia into a future that appears to be the opposite of global and regional trends and less attractive to our industry,” the letter read.
“Countries that today prioritise [renewable energy] and a green future will avoid wasting money on outdated technologies that will soon be obsolete and expensive,” it added.
The letter was sent on 11 August when Cambodia became partially suspended from the Everything But Arms trade benefit. This means some of Cambodia’s exports such as garments, footwear and travel goods became subject to the EU’s customs duties and will now incur duties at the WTO’s Most Favoured Nation (MFN) rate.
A spokesperson for H&M said: “An important part of our ambition to become climate positive by 2040, is to maintain a close dialogue with stakeholders and policy makers in the countries where we are present. In the letter to the government, we address the importance of continuing to develop the renewable energy landscape in Cambodia and decreasing dependency on fossil-base solutions for the supply chain, while at the same time companies are take steps toward their climate ambitions. This will play a key role in the future of Cambodia as an attractive sourcing market.”
Adidas declined to comment on its participation in the letter but a spokesperson said the group is committed to promoting the use of renewable energies in the coming years. In Germany, the company already sources almost all its electricity from renewable sources. It also provides suppliers with policies and best-practice guidance for environmental management, by offering training sessions tailored to their needs, and by measuring their progress toward clear reduction targets for energy.
Puma and Gap did not respond to just-style’s request for comments at the time of going to press.
The letter also coincides with a new report urging the global fashion industry to rely less on coal and other fossil fuels in the supply chain if it is to address climate change as a critical part of its Covid-19 recovery strategy: Fossil-free fashion must be part of post-pandemic recovery.