Blog: Michelle RussellLockdowns "killing" Bangladesh garment industry

Michelle Russell | 19 March 2021

The owner of a jeans manufacturer in Bangladesh is warning of a grave humanitarian crisis in the country if fashion stores in key export markets do not reopen for business soon. In an open letter to governments in the EU, UK and US, Mostafiz Uddin, the managing director of manufacturer Denim Expert Limited, says ongoing lockdowns in Western markets are killing Bangladesh's ready-made garment industry.

Swedish fashion retailer H&M Group has paused placing new orders with its suppliers in Myanmar as violence continues to unfold across the country amid the military coup.

And in Tunisia, a major review has been launched into the clothing sector's market positioning in a bid to help manufacturers survive the ongoing political turmoil that is wracking the country.

Meanwhile, the US is committed to combating unfair Chinese trade practices and enforcing existing trade agreements. The first trade policy agenda released by the Biden Administration says the US recognises China's "coercive and unfair trade practices" harm American workers, threaten its technological edge, weaken its supply chain resiliency, and undermine its national interests.

China’s next five-year plan, however, aims to push clothing production westwards – including the contentious province of Xinjiang – and grow the domestic market in the the world's largest producer of apparel, footwear and raw materials.

The US$1.9 trillion economic relief bill signed into law by President Joe Biden has been described as "enormously beneficial" for the US apparel and footwear industry. The 'American Rescue Plan Act of 2021,' (H.R. 1319) provides additional relief to address the continued impact of the Covid-19 pandemic on the economy, public health, State and local governments, individuals, and businesses.

US apparel imports remained at high levels into the start of 2021, bucking the usual trend for a slowdown after the holiday season. Import volumes climbed more than 13% on the month before as retailers continued to ship huge amounts of merchandise to meet ongoing consumer demand.

Adidas has set out a new growth strategy designed to significantly increase sales and profitability as well as gain market share by 2025, with an investment of more than EUR1bn (US$1.19bn) to digitise core processes across the entire value chain from creation through sourcing to selling to consumers.

The European Parliament has adopted a report which calls on the European Commission to propose legislation that forces companies to fix human rights and the environment in their supply chains.

According to new research from the Capgemini Research Institute, overhauling supply chains is set to be a priority for consumer product and retail companies following the Covid-19 pandemic.

In the M&A space, sports retail giant JD Sports Fashion Plc has struck a deal to acquire a 60% stake in Poland's Marketing Investment Group (MIG), which sells a range of sports fashion footwear and apparel from leading global brands, primarily under the Sizeer and 50 Style fascias. While, Next Plc has agreed to acquire a 25% equity stake in fashion chain Reiss.

In other news, M&S has expanded its online offering to 46 new international markets; Ralph Lauren is introducing Cradle to Cradle certified products; and Gap Inc is reportedly mulling a sale of its China business.


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