Ethiopia risks becoming a new low-wage paradise

In February 2016, H&M launched a project to improve the textile industry in Ethiopia as part of a project with Sida (the state agency for international development), Swedfund (a state venture capital company) and the ILO (International Labor Organization). Three months later, it was announced that H&M was opening a new textile factory for sustainable production. This concerns environmental awareness and improving the living conditions of Ethiopians, especially Ethiopian women. However, a report published by SVT News revealed that the daily allowance is about ten kronor a day. With rising costs and the employees already living on low wages, there is concern that the wage cannot be lived on. This is in line with a report by the organization Fair Action which states that H&M does not live up to the salary standard that was announced. There is also, according to the interviewed source, a concern among employees to file complaints of fear of reprisals. The question is whether H&M repeats the mistake of investing and buying from companies that do not have good working conditions and whether the lessons learned from previous scandals have really been adopted. Swedfund's CEO Gerth Svensson has said that the wage level in Ethiopia is lower than in Bangladesh. This raises the question of whether H&M is making the same mistake as before and creating a new Bangladesh in Ethiopia. While the goal was to increase women's autonomy and to increase workers' rights and freedoms, it can be said that the opposite effect is being achieved.

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