Washington, D.C., September 3, 2014—IFC,
a member of the World Bank Group, and global apparel and footwear company
VF Corporation, will provide up to $10 million to help VF suppliers in
Bangladesh finance fire and building safety upgrades in their factories.
VF, the parent company to many well-known brands including The North Face®,
Vans®, Wrangler® and JanSport®, will provide a full corporate guarantee
in support of loans for its suppliers. This enables IFC and its partner
BRAC Bank to lend to suppliers at lower interest rates and helps suppliers
speed up fire and building safety upgrades.
The garment sector in Bangladesh accounts for 80 percent of country’s
total export earnings and 20 percent of its GDP. It employs more than 4
million workers—80 percent of them women—in formal jobs in more than
4,500 factories. The sector, including buyers and suppliers, is eager to
improve workplace environment and sustainable competitiveness.
VF is a founding member of the Alliance for Bangladesh Worker Safety, an
industry group of international apparel manufacturers and buyers. This
group has provided fire and safety training to more than 1 million Bangladeshi
factory workers and carried out inspections at all 587 factories that supply
its members. Its work has resulted in corrective action plans for bringing
factories up to acceptable standards. Lack of financing is an obstacle
for many suppliers needing to invest in these safety upgrades.
“The safety of the people making our products around the world is an imperative,”
said Eric Wiseman, chairman, president and CEO of VF. “Our program with
IFC helps to ensure that our suppliers have access to the necessary capital
to complete safety improvement plans.”
Serge Devieux, IFC Director for South Asia, said: “Employment in the apparel
industry has reduced poverty for millions of women in Bangladesh. This
financing model, which we think could work well for other buyers and suppliers,
will help Bangladesh’s suppliers improve work conditions and strengthen
the country’s ability to attract garment manufacturers”.
This financing arrangement with VF Corporation is part of IFC’s broader
approach to transforming Bangladesh’s textile sector. IFC also launched
its supplier-finance program, which allows suppliers to improve their access
to working capital. Besides providing financing, IFC supports better labor
and environmental standards through advisory programs such as Better
Work Bangladesh and the Bangladesh Partnership for Cleaner Textiles.
IFC is also investing in energy and power to improve power supply in the
electricity grid and reduce the need for dangerous rooftop generators.
About VF Corporation
VF Corporation (NYSE: VFC) is a global leader in the design, manufacture,
marketing and distribution of branded lifestyle apparel, footwear and accessories.
The company’s highly diversified portfolio of 30 powerful brands spans
numerous geographies, product categories, consumer demographics and sales
channels, giving VF a unique industry position and the ability to create
sustainable, long-term growth for customers and shareholders. The company’s
largest brands are The North Face®, Vans®,
Timberland®, Wrangler®, Lee® and
Nautica®. For more information, visit www.vfc.com.
IFC, a member of the World Bank Group, is the largest global development
institution focused exclusively on the private sector. Working with private
enterprises in about 100 countries, we use our capital, expertise, and
influence to help eliminate extreme poverty and boost shared prosperity.
In FY14, we provided more than $22 billion in financing to improve lives
in developing countries and tackle the most urgent challenges of development.
For more information, visit www.ifc.org