https://actionaid.org/publications/2023/people-profit-why-urgent-action-...
As the role and size of the private sector in Ethiopia continues to grow, human rights abuses resulting from business activities are on the increase, including in the garment and textile industry. The overwhelming majority of employees in this sector are women, and many are vulnerable to exploitation in the form of low wages, poor working conditions, sexual harassment and abuse.
Economic growth and investment in Ethiopia and its impact on human rights Background In recent years, following the promotion of its free market regime, Ethiopia has been implementing various economic measures aimed at strengthening the private sector, boosting competition and increasing investment including by adopting investment proclamation No. 1180/2020 in April 2020. Government has opened up various sectors of the economy previously reserved for unilateral state investment resulting in some Multi-National Enterprises investing in sectors such as petroleum refining, mining, real estate, large-scale commercial farming, manufacturing, and renewable energy.
These measures combined with increases in production costs in other parts of the world has led to a rise in the flow of foreign direct investment in recent years. For example, Ethiopia has recently emerged as a major destination for the apparel sector, with industrial parks created as special economic zones to drive manufacturing-related job creation. Impact Private sector investment has an indispensable place in economic growth and development by bringing capital and technology, generating much needed foreign currency, and creating employment opportunities. Whilst prevailing low wages have made Ethiopia one of the preferred investment destinations for companies, this has come at a cost, most notably to workers.
For example, since 2020, the International Trade Union Confederation (ITUC) has rated Ethiopia at category 4, indicating that workers’ rights are systematically violated, a factor corroborated by several recent studies. Although women make up nearly 80% of employees in the garment industry, most of them are employed on the factory floor, with little opportunity for growth and development. In addition, many experience harassment and abuse, unsafe workplaces, forced overtime as well as draconian wage deductions as punishment for minor disciplinary infractions.
Discrimination against pregnant workers is also common. In 2019 the New York University Stern Center for Business and Human Rights and the Worker Rights Consortium conducted research on the labour rights environment in Ethiopia’s growing textile and apparel export sector. Highlighting the impact of the low wages in particular and its negative impact on the overall living conditions of workers, the report stated:
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