Developing countries, like Pakistan, will be hardest hit by the COVID-19 pandemic. They are facing an unprecedented health and economic crisis, with potentially extreme economic, social and sustainable development consequences that may reverse decades of development progress. The impact of the crisis is especially strong on workers in the textile sector, who have always been facing vulnerable employment situations. The low-price model of the fashion industry is not including fair labor and environmental costs and the industries current linear supply chain set-up and a finance model which puts the main risk on manufacturer have spawned an unequal relationship, with manufacturers complete dependence on their customer brands. Supply disruptions have shown how important it is for the local industry set-up to be independent from raw material imports and international brands as sole target group.

Within this project, Closed Loop Fashion will identify, develop, and implement workable CSR approaches with focus on environmental sustainability and resource management at six of the largest vertically integrated Pakistani textile factories. In the framework of the project, four key target areas have been identified in the field of economic and environmental sustainability, with defined activities for the creation of a customized, new sustainable business model, resource efficiency and the reduction of textile waste by integrating innovative, circular design strategies and product development, digitisation, local collaborations to secure future supply, empowerment of lower-skilled workers and capacity building to anchor know-how.

The project will be conducted in the framework of the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH’s Labour Standards Programme  (LSP) project ‘Improvement of labour and social standards in the Pakistani textile industry’ commissioned by The German Federal Ministry of Economic Cooperation and Development (BMZ).