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STOCKHOLM Jan 15 Hennes & Mauritz said on
Wednesday it saw good opportunities for producing clothing in
sub-Saharan Africa, a move which would reduce its reliance on
countries like Bangladesh where election unrest has disrupted
the garment sector.
H&M has already started producing clothes on a small scale
on the continent and Africa would complement the company's
production in Bangladesh, China and Cambodia, Hennes & Mauritz
CEO Karl-Johan Persson told Swedish business daily
"I think that there is great potential in sub-Saharan Africa
when it comes to production," Persson told the paper. "We have
started producing on a small scale in Ethiopia and we will see
how it goes. It seems very interesting."
H&M sources most of its garments from factories in Asia,
particularly Bangladesh, where a factory collapse last year that
killed more than 1,100 people put pressure on big brands to
improve working conditions for those making clothes for the
Election-related violence has also disrupted Bangladesh's
garment industry, the world's second biggest after China, while
a shutdown by striking garment workers in Cambodia, another big
supplier, has further squeezed global fashion firms.
Arch rival Inditex relies less on developing
nations to produce its clothes than H&M.
According to Dagens Industri, H&M plans to undertake a
survey of production opportunities in Africa this spring, for
instance in South Africa where it plans to open its first store
"There won't be dramatic changes in the distribution of
production in the short term, but there may be bigger changes in
the long term. It depends on how prices, quality and lead time
develop," Persson said.
He also saw sales opportunities for the firm in African
markets in addition to Morocco and Egypt, where it already has
"Africa is a continent where many countries are growing very
fast, where there is a growing middle class and in time a huge
potential for sales," he said.
Separately on Wednesday, H&M reported brisk sales for
December, the first month of its fiscal first quarter.
Total sales were up 10 percent in the month, giving the H&M
share price a 2 percent lift and making it the biggest gainer on
the day on Stockholm's blue-chip index.
The company said it would no longer report comparable sales
for stores open at least a year, saying total sales were more
(Reporting by Mia Shanley; Editing by Greg Mahlich)