The textile industry and its miseries

When I was a child my parents always told me to take care of my clothes so that when they were too small we could give them to cloth collectors who would then send these clothes to the poor people in Asia and Africa. We were all thinking that we did a good thing and that our clothes would help kids in poor countries.

During my University time, I studied the economy of African countries and my opinion drastically changed. It is certainly not a bad thing to recycle clothes that could be used by others but the problem was and still is, that there is a huge industry behind all this. The clothes go to the poor countries but there they are not distributed for free. They are sold for prices per Kilo to owners of second hand shops who sell them later with a margin to their customers. The problem is that these clothes are much cheaper to buy than what is produced by the local industry. So what happens is that the tailors, the textile producers go out of business.

In recent years, some countries tried to forbid imports of second hand clothes but there is a lobby behind it and so far only Rwanda will implement a prohibition to import second hand clothes. The big defender of the lobbies is the USA...

What does that mean for the farmers in these countries?

Since the industry is almost non existent at a local level, the farmers who produce cotton have no local demand and they have to sell their crop to agents who in turn sell them on the world market. The problem is that the farmer only gets a very little margin of the profits. He has to bear all the risks and has no guarantee that the crop will still be profitable when harvested. In addition to that, the agents are often enjoying a monopole and pay the farmers when they choose to do so.

A nasty circle

In the third world the cotton farmers are producing for the ever changing needs of the developed countries. The clothes sold in Europe and in North America have to be always cheaper and cheaper, letting a lot of people work for very little money. It is very difficult to reduce the production costs of cotton, the production of tissues or the tailoring of clothes. However the prices still continue to drop in our shops. The problem is that this price drop is not generated by higher productivity, it is generated by lower margins for the people included in the industry. If a couple of cents per t-shirt can be saved, then there is no hesitation to dislocate the production from Pakistan to Bangladesh for example. So everybody is in competition with the world market and a lot of people are living in poverty in spite of working terrible hours in sometimes horrible conditions.

In addition to that, after being worn a couple of times in Europe or the USA, the clothes are collected and sent back to the people living in the poor countries. Like that insuring that the local textile industry will never evolve.

In India many farmers kill themselves on their cotton field because they can simply not pay back the loan they took to buy the protected seeds. In Bangladesh people die when textile factory buildings collapse because there is no money to renovate the old buildings.

What answer is there to this?

When I see what happens in these countries, it revolts me and I want to do something about it. I want to buy clothes that are produced in a sustainable manner and I also want that the people who produced these clothes earn enough to survive and to feed their families. But how to keep track?

The Blockchain to authenticate the provenance of cotton

Through a friend of mine, I discovered a very interesting project called Cotton Coin which integrates the whole supply chain in one ecosystem based on the blockchain technology. This would allow to track the sources of the crop and to follow its way along the supply chain. In addition to that it would provide a coin that would allow immediate transactions between the different actors along the chain. This is certainly a very promising step towards a better life for the people in the textile industry. You can find more information about Cotton Coin on their website.