ADDIS ABABA, Nov 19 – Global fashion giant PVH
Corp. is closing a manufacturing facility in Ethiopia,
the company told Reuters on Friday, two weeks after the African
country lost duty-free access to the United States over the
ongoing conflict in Tigray.
Government spokesperson Legesse Tulu said the closure showed
the impact of the “unfair sanctions” from the U.S. which would
disproportionately affect the country’s poor and women.
The move by PVH, which owns Calvin Klein, Speedo and Tommy
Hilfiger, is the first retreat from a large manufacturer
following suspension of duty-free access. It is a blow to the
Ethiopian economy, already grappling with high inflation https://www.reuters.com/article/ethiopia-inflation-idUSL8N2S239I,
drought, and a year-long war https://www.reuters.com/article/us-ethiopia-conflict-timeline-idAFKBN2HM1RF
that has killed thousands of civilians and displaced millions.
This year, PVH sold https://www.reuters.com/article/pvh-corp-divestiture-idCNL3N2O52R3
several brands, and the company said this prompted it to begin
planning a transition of the facility to a trusted supply
partner active in Ethiopia.
“The speed and volatility of the escalating situation
there made the transition no longer possible, resulting in the
difficult decision to close the facility,” PVH said in a
statement.
On Nov. 2, U.S. President Joe Biden moved to suspend https://www.reuters.com/article/us-ethiopia-conflict-trade-idCAKBN2HN1QQ
Ethiopia from the African Growth and Opportunity Act (AGOA)
“for gross violations of internationally recognised human
rights.”
Ethiopian officials had warned the suspension could take
away 1 million jobs, disproportionately hurting poor women who
are the majority of garment workers.
Conflict erupted last year between the federal government
and the Tigray People’s Liberation Front (TPLF), which used to
dominate national politics and now governs Tigray.
Around 400,000 people are believed to be living in famine
conditions in Tigray, where the U.N. said on Thursday it has
been unable to deliver food for a month.
All sides fighting in the conflict have committed violations
that may amount to war crimes https://www.reuters.com/business/cop/un-ethiopia-rights-commission-release-report-abuses-tigray-2021-11-03,
the U.N. has said.
PVH arrived https://www.reuters.com/article/us-ethiopia-textiles-idUSKBN1DL1VU
in Ethiopia in 2017. Like most of its peers, it was in Hawassa
Industrial Park, located south of Addis Ababa and designed by
the government to attract garment and textile manufacturers and
make Ethiopia a light manufacturing hub.
The AGOA suspension threatens https://www.reuters.com/world/africa/ethiopian-textile-industry-risk-if-us-suspends-trade-deal-over-tigray-war-2021-10-28
those aspirations and could force other manufacturers to close,
too.
PVH did not say how many people worked at the factory and
did not immediately answer a question about it.
Ethiopia exported $237 million duty-free to the U.S. last
year, U.S. Commerce Department data said.
PVH said in its statement that it was still “committed” to
its third-party manufacturing partners in Ethiopia.
(Reporting by Addis Ababa Newsroom; Editing by David Gregorio)
