Port-au-Prince, Haiti, December 17, 2020.- The International Finance Corporation (IFC), member of the World Bank Group, partnered with L’Association des Industries d’Haïti (ADIH) to help the apparel sector in the country navigate and recover from the adverse impacts of COVID-19.
Following ADIH’s request, the organizations developed a joint research that evidenced the challenges that the export-oriented garment sector is facing, but at the same time shed the light on opportunities to attract private capital.
IFC provided technical support to carry out a survey on “How Has COVID-19 Affected Haiti’s Apparel Industry,” interviewing 33 firms from the sector, that represent 87 percent of ADIH’s membership and collectively employ more than 50,000 workers. The study was conducted between May and June 2020, with funding from the Korean-IFC Partnership Program (KIPP).
The survey provides key insights to help public and private decision makers navigate the crisis, and signals opportunities for the export-oriented garment sector in the country.
In the supply side, the study confirmed the difficulties manufacturers were facing in accessing raw materials, working capital, and the adverse impacts of restrictions on factory operations during the first months of the pandemic due to the sanitary emergency announced by the Haitian government.
Companies indicated that by June, half of orders were reduced or cancelled and a third of the jobs were lost. By August, businesses were still operating at 75% of their capacity, often with reduced workdays per week. The majority of respondents expect at least a 30 percent loss in revenues in 2020 as a result of the pandemic.
But the study also found encouraging data for business opportunities in the sector: although their potential is underutilized due to low volume of usual orders, the study evidenced that most firms have capacity to produce personal protective equipment (PPE), which could save their companies and thousands of jobs, and could contribute to satisfy the growing global demand, in particular in the COVID-19 pandemic context.
“The report has been a powerful tool to facilitate the dialogue with our membership and public institutions and provides valuable insight on the opportunities for the apparel industry in Haiti to meet the growing global demand for protective equipment and attract more investments,” said Wilhelm Lemke, President of ADIH.
ADIH Members have strived to urgently implement the health protection measures established by the Ministry of Public Health and Population (MSPP) to not only protect their human resources, but also to ensure that these measures, which have been maintained to date, allow the factories to continue to produce reduced orders of garments in accordance with their buyers’ requirements, thus enabling them to export the new PPE production to the foreign market.
To take advantage of these opportunities and help the industry in its recovery from the pandemic, IFC will continue to work with the public and private sector to support retention of jobs and investment in the industry, and help companies shift to the production of PPE, find new apparel goods to be produced for export, and attract new investments.
“IFC has supported Haiti’s apparel industry for more than a decade, during both the good times and also difficult times, and with the current challenges IFC is pleased to be working with this important sector to reach its potential,” said Judith Green, IFC Manager for the Caribbean.
“Our partnership with ADIH and the Government of Haiti is focused on helping the apparel sector navigate the impact of the pandemic and I am confident given IFC’s track record in Haiti and tailored approach this project will yield the desired results,” she added.
The apparel industry is Haiti’s largest formal employer, providing jobs for over 55,000 Haitians, supporting more than 450,000 people. Before COVID-19, it accounted for 90 percent of Haiti’s exports of goods.
IFC started working with Haiti’s apparel industry in 2009, providing advisory support that helped attract new investments in the sector, contributed to the creation of thousands of jobs and the improvement of labor conditions to international standards.
To read the report, click here.
