10. Textiles and Clothing

Shift to low wage economies

Textiles are not simply consumer goods that serve to satisfy a basic need. Clothing is dictated by fashion. People in Western Europe permit themselves the luxury of "using up" 10 kg of clothes per year. The clothes we buy are usually not produced in our own country. Textiles are world market products. So a "German" jacket could be produced as follows:

"Cotton from Kazakhstan is spun to yarn in Turkey. This yarn is woven into cloth in Taiwan. This cloth may be printed in France using dyes from Poland and China. In the course of tailoring it may then be used together with Swiss lining material for a specific garment." ...

The declaration of materials of materials and origin on garment labels gives no indication of its multiple origins. This is the result of the clothing industry's search for low wage economies.

Groups of countries in the textile sector

Countries Examples Characteristics
Traditional industrialised countries

Germany/Western Europe, Japan, USA decrease in mass business, job losses, specialised production technical textiles
Newly industrialising countries

Hong Kong, Singapore, South Korea, Taiwan, Malaysia, Thailand, Mauritius step-by-step change to other 'promising branches'
Former socialist state trade countries Poland, CSFR etc Russia, other CIS countries low wages, skilled workers ...
Industrialised threshold countries Brazil, Argentina, Mexico, Turkey, parts of China own state-sponsored industry (export)
"Custom refiners" of (ready-made) clothing Sri Lanka, Bangladesh, Vietnam, Albania, Romania industrialisation on a small scale, uncertain prospects
Economically underdeveloped countries Peru, Bolivia, black African countries very little industry import of old clothes

10.1 World Textile Trade

A few years ago, world textile trade could be described, in simple terms, as a process going on between the three political "blocs" or "worlds". The political scene has now changed radically and the "Second World" no longer exists. As a consequence, the textile sector has also experienced major changes. The centres of the textile industry and therefore also of trade-flows have shifted from the traditional industrialized countries in the West to the newly industrializing countries in Asia and Eastern Europe (see box).

In fact it is not the countries, but business enterprises which are the major protagonists of textile production and trade. Among them are many small and medium-sized companies. However, big multinational textile and clothing enterprises and chain stores, such as the C&A Brenningmeier combine or the Steilmann group control the lion's share of the world market. They are the ones who "pull the strings". They make use of the different production forms - from mass production in big factories to small-scale or home industry - by passing orders to subcontractors, in order to achieve lowest cost production overall.

In the meantime, enterprises in Hong-Kong, South Korea, India and other newly industrializing countries have begun to assume a similar role. They are active in (other) Third World countries and some of them even in traditional industrialized countries.

 
Steilman, Germany
Production and sales
Production Sales
Germany: 38 companies, 4.000 employees Total turnover 1,7 B DM (1993)
Eastern Europe 42 companies, 35.000 employees Germany 50%
Asia: 27.000 employees EU 30%
USA 20%

Since the seventies many of these big enterprises have established production plants in tax-privileged free trade areas of "Third World" countries. In these areas textiles, which are largely imported, are tailored into clothes, pressed and packed with machines which are mostly imported, too. These ready-made clothes are immediately re-exported to the moneyed markets of the North. These "world market factories" employ almost exclusively women. Very often they have to work under inhumane conditions. In Honduras more than 2.000 women produce pullovers of the renowned brand "Liz Clairborne" for the US market in the industrial park "Galaxi Industries", which has its origin in South Korea.

These "extended workbenches" of the industrialised countries can also be found more and more often in the former "Second World". In a former textile combine in Jánosháza, Hungary, women sew textiles from Germany, supplied by the Austrian company Eybl, into car seat covers for German Mercedes cars.

Enterprises in the textile sector

Raw cotton trade Ralli Broth. (GB), Volkhardt Broth.(Switzerland), Mc Fadden (USA), Toyo Menka Kaisha (Japan)...
Production of chemical fibres Du Pont (F), Rhone Poulenc (F), Höechst (FRG)
Textile enterprises (spinning mills, weaving mills etc) Kanebo (Japan), Burlington (USA), Samsung (South Korea), Unitika (Japan), D.M.C.(F), Freudenberg (FRG) ...
Machine-building industry Sulzer (Switzerland), Investa (CSFR), Nissan (Japan), Zinser (FRG), Schlafhorst (FRG)
Ready-made clothing Levi Strauss (USA), Renown (Japan), Benneton (Italy), Steilmann (FRG)...
wholesale/retail trade Seibu (Japan), C&A Brenningmeyer (NL etc.) Quelle ...

10.2 The Textile Industry in the Third World

Many of the economically underdeveloped countries, however, remain blank on the new textile map. In the last few years, most black African countries have had to accept a slump in their textile industry, and therefore have become increasingly dependent on imports of used clothing from the North. But in some countries in the South, especially in Asia, the textile industry is booming.

Table: Wages in the textile industry (missing)

US $/hour 1991

Source: Werner International, 1993
Clothing production in India

Clothing and textiles are India's main export products and account for 11% of total Indian exports. Clothing production for the domestic market is negligible. Only a minor proportion of the urban elite wear off- the-peg clothes, the rest of the population wearing unsewn clothing such as saris or lungis, or tailor-made clothes. The Indian government intends to turn the garment industry into the most rapidly expanding export sector. At present, 80% of such exports are governed by the Multi-Fibre Agreement. It is therefore of great importance to the Indian authorities that the MFA arrangements leave enough room for extensive growth.

To promote the export of clothing, the licence system has been liberalised drastically and the way in which production is organised is left to entrepreneurs. By far the cheapest method is to farm out the labour-intensive production to the informal sector. As a result of this practice of farming out, however, it is difficult to control working conditions and terms of employment.

At the same time, India is faced with a rising level of unemployment. An important objective of the Indian government's employment policy is to protect and foster small-scale industries, in particular in the labour- intensive sectors. Thus, higher tax rates are imposed on larger companies than on small ones, and in a number of sectors large companies (employing over 50 persons) are prohibited from extending their capacity. A variety of measures have also been taken to promote the establishment of small-scale companies, e.g. through subsidies, preferential treatment in public procurement and through encouraging large companies to contract out to small ones. In addition, small companies are exempt from complying with part of the labour legislation, which was adopted to protect the workers' rights. It is therefore no surprise that the small- scale industry has seen an enormous growth in the past few years.

Yet, the effectiveness of the government's employment policy is limited. In particular small-scale companies applying relatively modern production techniques have benefitted from the measures taken. As a result, the supply of labour in the small-scale sector is still on the increase, thus keeping wages down. It is therefore becoming increasingly cheap for Western clothing traders to source their products from India or other countries in the South.

The Multi Fibre Agreement (MFA)
Clothing from Bangladesh

The Bangladeshi garment industry is booming. Exports in this sector have increased by 20 percent annually in recent years, export earnings were to 3.2 million dollars in 1981 and had risen to 700 million dollars by 1991. This makes clothing the main export product for Bangladesh. For example, clothing accounts for 90 percent of total Bangladeshi exports to the Netherlands! The products are mainly simple garments, which require relatively simple machines and much labour. The fabrics are provided by the buyer, although the country has by now built up considerable expertise in knitting T-shirt cloth and has become a major supplier of T-shirts.

Bangladesh has 1500 clothing factories, employing 300 to 400 workers each, and there is formidable competition between them. The large majority of workers (80%) are women; thirty percent are children: girls and boys. Women and girls in particular provide a cheap labour force. They play a totally unacknowledged role in the overall pattern of consumers who want cheap T-shirts, chain stores and/or traders who sell cheap and still want to make a profit, and Bangladeshi manufacturers who pursue the same objectives.

Fatema has worked in the clothing industry since she was 13. Being the eldest daughter of a rickshaw driver, her earnings are a welcome additional source of income for her family. She exchanged her former job at Excell Garments Ltd., where she did odd jobs, for her present job at Dax Garments Factory, where she could earn a better wage as a sewing machine operator. After three months, however, she has received only one month's wage: the director says he has no money. All she did get from her boss were beatings and shouting.

Upon inquiry among other boys and girls who work in the textile industry, it appears that many have started at the age of 10, 11 or 12. Some of them are not discontent with their pay, but are unhappy about the overtime work they are forced to do: 48 hours on end is not unusual. Nazrul, who is 18 and active in the garment workers' federation (it may not be called a trade union; unions were officially prohibited until last year), cites instances of people working 72 hours on end. His major complaint is that he never has a holiday. The same goes for Latta, aged 12, who has never had a day off since she started to work in a clothing factory 18 months ago.

Rosaline Costa who is employed by the Asian American Free Labor Institute in Bangladesh says: 'People toil like animals, no holidays, never a day off. Children are not allowed to go to the toilet during their work and are consequently affected by kidney disorders. Do you want to buy clothes that have been produced under such circumstances?' The textile industry is of major importance for the future of Bangladesh, Costa agrees. 'But my point is: not in this way, not by trampling on little children. And also for the many women employed in the textile industry, wages and terms of employment must improve. It would be very good if the West accepted only decently produced clothing.'

Ever since she announced her intention to found a textile workers' union, and in particular since her warning on American television: 'Your T-shirt is tainted with the blood of thousands of children', Costa is under constant surveillance. 'But why should I care', she says, 'as long as something is done about child labour.'

Consumers, purchasers and manufacturers currently show little concern for the position of children and women. We asked the clothing workers' federation whether a higher purchase price would help. 'Not in all cases', is the answer, 'but on the whole, wages will go up.' The union and its members in Bangladesh fight for their case; Europe will have to accept that there is a higher price tag attached to 'honest' T-shirts.

Levi Strauss and C&A

When doing research on child labour in India and Bangladesh, Nick Buckley, a journalist who works for the British newspaper Mail on Sunday, found connections with both the international clothing company C&A and jeans manufacturer Levi Strauss. Buckley: 'Since I've been there myself, for me child labour means boys and girls aged eleven, twelve, thirteen, working from 8 o'clock in the morning till midnight. In a factory. Away from their parents. Perhaps sharing a hut with three or four girls at night - a bamboo hut of three by three. They get two bowls of rice a day, one of them also containing some vegetables. And perhaps once a week a piece of meat. And most of the children we met don't even earn fifty pence a day.'

The manufacturer says: 'they do it for the money'. No, they don't do it for the money. They do it because they have to. Because they have to eat, because they have to pay the rent, because they need clothing. Most children we saw were from rural areas. They thought they would really be earning money to send back to their parents in the village. But they find out soon enough that half their earnings for a 70-hour working week go to paying the rent. They write letters to their families to apologise: "I'm sorry, but I cannot help to feed my younger brother or sister." Why does this happen? It happens because everyone wants it to happen. Western companies want cheap labour and higher profits, and the countries in the South want their share of the money from the West. It is a conspiracy, in which the children are the victims. And the other workers are too. In these countries, wage and minimum age laws exist but are not enforced. They are simply violated. The children are told to lie about their age, and their wage, if a foreigner asks them about it. This conspiracy is continuing and governments on both sides are equally to blame.

In our research, we concentrated on two firms, one being Levi-Strauss in Bangladesh. Levi-Strauss contends that they have done away with child labour. They boasted that they had set up a school in one of the units. When we had a look at that factory, which employs three thousand people, we found a single school with a mere seventeen pupils. The children told us they were a bit disappointed. The school would be closed again in a month, because they had all reached the 'mature' age of fourteen. They were keen to continue with school, but had to return to the shop floor. When we saw the conditions under which they live in the bamboo huts, we said to each other: even if this isn't child labour, then this whole system which keeps the people confined to the factory, the huts, the two meals a day, is wrong. It is morally unacceptable. Businesses such as Levi-Strauss and consumers like ourselves have the responsibility to try and change this situation.'

'We happened to come across C&A. I have been told that you can chance upon C&A anywhere in the world. But I must say that, as soon as we told them of our experiences in Bangladesh, C&A immediately sent an investigation team. They also admitted that we were absolutely right, that the situation there is shocking. They have severed all connections with that factory and dismissed the importer who traded with it. What I found most revealing is that C&A did not even know they bought products from that factory. When we mentioned the name, they had never heard of it. C&A say that they are against child labour, and maybe they are. But if they are not aware from what factories they buy and are not even trying to find out, then how in heaven's name would it be possible to introduce a code or a label?

One of the best statements I have heard is from a company director in the United Kingdom. He said: 'No matter how beautiful your code, without a rigorous system for inspection it has little significance.' That is very true. C&A have promised to tighten up their practice. Nevertheless, the key to solving the problem of child labour and the exploitation of workers is a system of inspection, putting pressure on governments and textile manufacturers' associations, obliging them to give independent inspectors access to the factories and allow them to enter any room they like, talk to children and other workers, and draw up independent reports. But that will not be possible without the support of Western businesses, unions and consumers.'

Source: FNV, Een baan om de aarde, 1995
Price of a shirt in German Marks (DM)
cotton spinning weaving dying tailoring
+ | # d t
made in Germany : + || ### dd ttt
made in the Third World: + || ## dd t
ecological production : ++++ || ### dddd ttt
fair trade : ++ ||| #### dddd tt

10.3 Alternatives in International Textile Trade

For about 25 years European fair trade organisations have imported textiles (as well as other products) from the "Third World". These handcrafted products come from thousands of small producer groups, mostly women living in villages or suburban areas. The fulfilment of social criteria (see below) is a matter of course for fair trade organisations. Also environmental demands are taken into account, however, not always without problems. Indian handweaving cooperatives, for example, often cannot get ecologically grown cotton ("Green Cotton") and it takes some skill to become competitive and to meet ecological and social criteria at the same time. However, the European market for ecologically and socially "clean" clothing is growing, and investment will probably pay in the longer term.

Some European fair trade organisations - in particular Fair Trade Organisatie in the Netherlands, Gepa in Germany and Traidcraft in the United Kingdom - have recently developed new product lines of fashion clothing, so that their partners, e.g. BRAC in Bangladesh and Dezign Inc. in Zimbabwe, can expect new and profitable orders. This gives many women in the "Third World" the opportunity to find work that is socially and ecologically beneficial.

Cooptex, India
Social Stipulations

The model of direct trade with textile producers, as practiced by the fair trade organisations, can certainly not be applied to the world textile trade as a whole. It would not be wise from an economic point of view, as the commitment to specific supply markets would entail considerably higher costs and therefore competitive disadvantage. However, fair trade sets standards that can be and should be applied to others as well. These can hardly be prescribed by law, so how else can they become binding?

Federation of industries and trade unions demand that "social stipulations" should be included in trade agreements. But is it wise to make the planned liberalization of textile trade subject to such social and ecological conditions? These issues are negotiated in the context of the new World Trade Organization and the "Social Summit". Although there would be clear benefits, there are also some legitimate questions: Will these social stipulations serve as a pretext to drive cheap textiles imported from low wage countries out of the Northern market? Can this "protectionism" really be justified?

Another possibility would be to introduce a quality mark for textile products, similar to the Max Havelaar-/TransFair mark for coffee, tea and other foods. This would indicate that a minimum price has been paid and that other social minimum standards have been met. Knotted carpets from the South, that get the "Rugmark"-seal for renouncing child labour, provide an example of a similar approach. However, in view of the great differences in textile production in the various countries and regions it will be difficult to fix a set of social standards which are valid all over the world. Nevertheless, in the Netherlands the "Clean Clothing Campaign" with its "Charter of Fair Trade" for textile has set an example.

At present the fair trade organisationss can only promote the social interests of producers in the "Third World" through their particular range of products. The products themselves and information provided serve as a means to raise consumer awareness. This way is promising in view of increasing consumer power. In addition, the fair trade organisations which are united in EFTA at a European level act as a lobby for improved conditions for the textile and clothing trade as a whole. In cooperation with consumer associations, environmental organisations and committed enterprises the fair trade organisations campaign for environmental and social regulations to be observed by the European textile industry. Some textile companies (e.g. Steilmann in Germany) and big mail-order houses (Otto-Versand) already base their purchasing policy on environmental criteria. In order for social criteria to be taken into account the textile trade must take responsibility for the whole chain of production, right through to the subcontracts to homeworkers. "Third World" countries cannot be expected to keep to minimum wages and other social standards if companies and consumers in the industrialized world are not willing to change their shopping habits and to pay fair prices!

BRAC Aarong, Bangladesh
Dezign Inc., Zimbabwe
Social criteria for textile production
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