Promotion of sustainable energy practices in garment sector in Cambodia
The Global Green Growth Institute (GGGI) has partnered with the Garment Manufacturers Association in Cambodia (GMAC) to implement the promotion of sustainable energy practices in the garment sector in Cambodia. This four-year project, co-funded by the European Union through the Switch-Asia programme, currently implements activities promoting sustainable consumption and production in 24 countries. Paulami Chatterjee speaks to Bradley Abbott, Project Lead, Switch Asia, to find out more about the Switch Garment project, its key deliverables and progress since its launch 6 months back.
What is the scope of the Switch Garment project? Who are the key partners involved?
The 'Promotion of sustainable energy practices in the garment sector in Cambodia' project, otherwise known as Switch Garment, aims to increase the competitiveness and decrease the environmental impact of the Cambodian garment industry through sustainable production. Implemented over four years (2020-2024), the project seeks to stimulate investment in sustainable energy technologies and practices, such as energy efficient equipment and automation, energy management, and renewable energy for garment factories.
The project is implemented by a consortium of partners with each bringing in its core valuable expertise. The Global Green Growth Institute (GGGI), an intergovernmental organisation that has been working to strengthen green growth governance in Cambodia since 2015, leads the project. Our partners Geres (Group for the Environment, Renewable Energy and Solidarity) are a longstanding NGO in Cambodia, with over 25 years of in-country experience developing and implementing clean energy projects. Lastly, the project team is tied together by our partners at the Garment Manufacturers Association in Cambodia (GMAC). GMAC represents over 600 garment factories in Cambodia.
Cooperation with our government counterparts in the Royal Government of Cambodia (RGC) also plays a vital role in the project; particularly The Ministry of Industry, Science, Technology and Innovation (MISTI) and the National Council for Sustainable Development (NCSD).
What are the trainings this programme is going to give to garment manufacturers on improving energy efficiency?
Switch Garment is working with factories on improving integrated sustainable energy outcomes for which energy efficiency and energy management are foundational. The training delivered as part of the Switch Garment project in partnership with GMAC will include ISO 50001 compliant energy management best practice, factory energy assessment skills to target and development of ongoing investments, measurement and verification of best practices to support energy management and investment on performance tracking, and other technology-specific skills like compressed air assessments, steam system assessments, and sustainable biomass use awareness. The Switch Garment project is taking an investment partnership approach. It has been recognised that an assessment is a very first step and the project aims to provide close sustainable energy investment decision support. We will judge the success of this project primarily on the number of actual factory investments made, not just the number of training sessions or energy audits delivered.
How badly was the garment sector of Cambodia impacted by the Covid-19 pandemic?
Figures vary, but in mid-2020 it is estimated that around 100 factories closed operations with 55,000 jobs lost. However, this has been short-lived, and the sector is bouncing back to near pre-Covid activity levels. Covid-19 has also pushed brands to reconsider sourcing practices and country destinations. It is less clear how Covid-19 has affected brand sourcing decisions although there is anecdotal evidence that many are reconsidering how much sourcing will be allocated to Cambodia.
What was the funding received for the project by EU?
The project is funded by the European Union (EU) Switch-Asia Grants Programme and received €2,995,748 (EU Contribution: 86.94 per cent). The overall objective of the EU funded Switch-Asia programme is to promote sustainable and inclusive growth, contribute to the economic prosperity and poverty reduction in Asia and Central Asia and lead the transition towards a low-carbon, resource-efficient and circular economy. Launched in 2007, the programme has achieved more than a decade of progress on sustainable consumption and production (SCP) in 24 countries in the region.
What are the key deliverables of the project after 4 years?
Over the next four years, we have several key outcomes:
Conduct 50 factory energy audits and deliver a range of factory training sessions covering energy management, energy audits, measurement and verification of savings and specific sustainable energy measures.
Identify and implement new policy and regulations that will facilitate sustainable energy investment in the garment sector.
Develop and implement a new sustainable energy investment monitoring and verification framework for the Royal Government of Cambodia.
Establish a finance facility to support finance for implementing sustainable energy projects in the Cambodian garment sector.
How can a switch to sustainable energy practices offer better employment opportunities to the local population?
Integrated sustainable energy investment is critical not only to factories but also to Cambodia's industrial transition aspirations. Integrated sustainable energy projects, especially energy efficiency investments, require highly skilled, local resources to implement and ensure performance. There is much talk about renewable energy and employment, but the employment benefits associated with integrated investments incorporating energy efficiency are exponentially better. Achieving the performance from energy efficiency and energy management investments require intensive, ongoing support from technology partners and this equates to good, transferable jobs that are needed for Cambodia's industrial transition.
There is no downside to integrated sustainable energy investments - both from the host facility perspective and the wider macro-economic perspective. This is backed by the International Energy Agency (IEA) in over 40 years of hard research. In 2020, the IEA Energy Efficiency report declared that energy efficiency measures can deliver 40 per cent of the energy-related emissions reductions needed by 2030.
The project was launched last year in September. What is the progress achieved in the last 6 months?
The Switch Garment project has seen many achievements since launching, including almost 20 factories recruited for participation, over 40 factory personnel trained in audit and data collection methodologies, and a range of important foundational activities executed, including major procurements. As the project has moved forward, we have also seen greater interest and support from key brands who are instrumental in achieving increased sustainable energy investments in factories. We think that one of the most important things achieved so far is the strong cooperation amongst the consortium partners. We have a dynamic team and GMAC has been an instrumental partner in helping to build trust with factories. Although it is early days and there is much to do, we are encouraged by the early-stage success. As with any project, our implementation approach is evolving to fit the needs of our factories and the sustainability aims of the brands. A key aim is to position the project and, by extension, GMAC as a valuable platform for factories and brands to cooperate on achieving strategic sustainability outcomes that will make the Cambodian garment sector more competitive. (PC)
What is the size of the textile industry in Cambodia? What is the workforce that it employs?
The Cambodian textile industry is dominated by ready-made garment factories. Although there is some diversity in the textile sector, ready-made garment factories (i.e sewing operations) comprise over 90 per cent of the export value. Cambodia's textile sector has little backward integration - meaning that inputs to factories, like material, are almost completely sourced from outside the country. The near absence of backward integration in garment factory value chains - such as textile input manufacturing, means that the main value-add for Cambodia remains the cost and skill of basic labour for sewing garments together and favourable business and trade conditions. The garment sector in Cambodia is the most important industrial segment and employs around 750,000 people, of which women make up approximately 80 per cent.
Which are some of the biggest concerns regarding Cambodia's textile industry on the effects it has on the environment?
Given that garment factories are extremely low-margin businesses, there is still very little value add to products within Cambodia compared with peer countries like Bangladesh. The implication for the environment is that factories are extremely risk-averse in terms of committing to marginal capital investments that would improve sustainability outcomes such as saving energy, water, or wood fuel resources. The business horizon for most factories is typically three years or less which means that a factory would want to ensure that any capital investment will have a significant return well before this window. The primary sustainability lever in the sector remains pressure from brands on factories to improve environmental outcomes. Although Cambodia's garment sector continues to expand, it is losing its edge compared to other countries like Bangladesh, Myanmar, and Vietnam. Cambodian factories are less competitive in terms of operating with a good sustainability outcome while also delivering on core brand expectations for quality and productivity.
The value chain sustainability challenges in Cambodia are emblematic of many other modern consumer product supply chains which enable brands to flexibly and quickly change production to the least cost and most favourable geographic area almost overnight. In the end, the rapid modernisation and flexibility of manufacturing amplifies the wicked sustainability problem posed by fast consumerism and the dual and competing demand of cheap consumer lifestyles and global sustainability.
Published on: 04/03/2021
DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.
