“Kanye West has one of the biggest hits of the decade – and it has nothing to do with music,” Forbes asserted in the summer of 2019. Sure, Kanye’s studio albums – from his 2004 debut The College Dropout to his most recent Ye – have made him one of the most famous musicians in the world. However, it is his Yeezy venture, including a partnership with German sportswear giant adidas, which first dropped in February 2015, that has positioned the 42-year old as retail force to be reckoned with.

Not unlike Michael Jordan, who made his name in basketball before making a pretty penny by way of his eponymous tie-up with Nike beginning in the 1980’s, “The key to West’s wealth stems from sneakers,” Forbes Zack O’Malley Greenburg stated in 2019. (Valentim Group, the valuation firm launched by a handful of former partners from U.S. transfer pricing firm Economics Partners, puts the value of his music catalog to date at an approximately $110 million).

While West’s ongoing partnership with adidas made its formal debut in 2015 (the parties actually began working together in 2013), his footwear ambitions date back further. His Yeezy line first made headlines by way of the shoes he launched with Nike in 2009, which he then parlayed into a multi-year deal with adidas in 2013, noting that his 2012 Air Yeezy II “was the first shoe to have the same level of impact as an Air Jordan, and I wanted to do more.” He also wanted royalties (i.e., a percentage of gross or net revenues derived from the sale of the Yeezy sneakers), which Nike reportedly was not giving him (or any other athletes at the time).

It would not be long before Nike’s closest and longest-standing rival, the Herzogenaurach, Germany-based adidas stepped in and offered him a better deal. “With the help of [then-manager] Scooter Braun, [adidas offered West] what appears to be an unprecedented [licensing] deal” in furtherance of which adidas can use the Kanye west-owned Yeezy name, and make and market products. In return, West gets “a 15 percent royalty on wholesale, according to sources familiar with the deal, plus a marketing fee,” according to Forbes. That is more than the 5 percent royalty that the New York Times recently reported that West earns – the same percentage that Michael Jordan earns from his partnership with Nike.

Bloomberg wrote last year that “West’s partnership with adidas AG, which manufactures and distributes the shoes, is more of a profit-sharing agreement than a typical licensing deal.” In furtherance of the agreement, one that is set to end in 2026, “West has “creative control over designs, while Adidas handles fulfillment and production.”

Yeezy: A Multi-Billion Dollar Business

Fast forward five years from the debut of the Yeezy adidas collection, and the rapper-slash-designer and the German sportswear giant have the $3 billion-earning Jordan empire “in [their] sights, in terms of both cultural clout and commercial prowess,” Forbes projected last year. The Yeezy venture was, according to Forbes’ calculations, “expected to top $1.5 billion in 2019. That figure represents a 50 percent increase from 2018, per Bank of America, and as of the summer of 2019, it was “still growing,” according to Forbes.

Newer figures put the business beyond that point. Bloomberg reported in April 2020 that “Bank of America Corp. valued the sneaker side of the business alone at as much as $3 billion last year,” cautioning that “that was before the COVID-19 pandemic devastated the fashion industry.” Specifically addressing West’s Yeezy deal with adidas, Bloomberg’s Sophie Alexander and Kim Basin put the deal in context of adidas’ larger portfolio. Citing Neil Saunders, an analyst at GlobalData Retail, a retail research agency and consulting firm, Bloomberg revealed that “Yeezy is ‘vitally important’ for adidas. Though it may be taking some sales away from the sneaker-maker’s other lines, Yeezy has had a halo effect on them, adding cultural prestige and raising the brand’s credibility with younger shoppers.” 

Since then, Bloomberg has provided yet another update on Yeezy, this time from UBS Group AG, which has valued West’s sneaker and apparel business, including his ongoing deal with adidas AG, as well as his impending venture with Gap Inc., “at $3.2 billion to $4.7 billion.” The value of the new Gap tie-up, in particular, “which will hit stores this summer, could be worth as much as $970 million of that total, the bank estimated.”

“Sales for Yeezy’s adidas sneakers remained resilient through the pandemic, growing 31 percent to nearly $1.7 billion in annual revenue last year and netting [Mr. West] $191 million in royalties,” Bloomberg reported, citing the UBS report. Meanwhile, based on the investment bank and financial services company’s documentation, “Gap expects its Yeezy line to break $150 million in sales in its first full year in 2022,” and if all goes well, “exceed $1 billion as soon as 2023.”

Breaking Down the Deal(s)

As for how these deals work from an intellectual property-ownership standpoint, it remains true that West maintains control of Yeezy, or more specifically, the trademark rights upon which the brand has been built, and upon which its partnerships so heavily depend. To breakdown is essentially this: West’s Mascotte Holdings is the sole holder of the trademark rights in (and registrations for) “Yeezy” and “YZY” for use on footwear and apparel, which West’s corporate entity then licenses to adidas for use in connection with the footwear collection, and to Gap for the impending apparel deal. This enables West to monetize this intellectual property (and bring in royalties), while still maintaining complete ownership over the identity of the venture.

(If Mascotte’s most recent trademark filing is any indication (and sometimes, a company’s filings are an indication of what is to come), West is looking to branch out further, with the IP holding company filing an additional “Yeezy”-specific trademark application for use of the name on cosmetics – including “concealers, blushers, facial powders, foundation makeup, eye makeup, eye pencils, eyebrow pencils, mascara, false eyelashes, face and body glitter, cosmetic compacts sold filled with cosmetics, cosmetic pencils, lipstick, lipstick cases, lipstick holders, lip gloss,” etc. – in June 2020.)

In terms of the long-running deal between West and adidas, the sportswear titan is not without rights of its own. For instance, adidas holds the rights in the Yeezy footwear designs, themselves, with adidas designers Nic Galway and Aurelien Longo listed as inventors of design patents for the Yeezy 750 Boost; and Galway, alone, listed as the inventor of the patent-protected classic Yeezy boost sneaker and variations thereof. All of the patents, and a similar copyright registration, are assigned to – and thus, owned by – adidas, and West receiving royalties based on sales in connection with the use of his Yeezy marks. Hence, the $191 million check West received from adidas in 2020.

From a transactional standpoint, chances are, the heavily-anticipated collaboration with Gap runs the same way.

*This article was initially published in July 2019 and has been updated to reflect Bloomberg’s new figures.

On March 11, Beeple, a computer science graduate whose real name is Mike Winkelmann, auctioned a piece of crypto art at Christie’s for $69 million. The winning bidder is now named in a digital record that confers ownership. This record, called a nonfungible token – or “NFT” – is stored in a shared global database. This database is decentralized using blockchain, so that no single individual or company controls the database. As long as the specific blockchain survives in the world, anyone can read or access it, and no one can change it.

But “ownership” of crypto art confers no actual rights, other than being able to say that you ‘own’ the work. You do not own the copyright, you do not get a physical print, and anyone can look at the image on the web. There is merely a record in a public database saying that you ‘own’ the work – really, it says you own the work at a specific URL. So, why would anyone buy crypto art – let alone spend millions on what is essentially a link to a JPEG file?

Art is inherently social

It might be helpful to think about crypto art in the context of why people buy original works of art. Some people buy art for their homes, hoping to incorporate it into their living spaces for pleasure and inspiration. But art also plays many important social roles. The art in your home communicates your interests and tastes. Artworks can spark conversation, whether they are in museums or homes. People form communities around their passion for the arts, whether it is through museums and galleries, or magazines and websites. Buying work supports the artists and the arts.

Then there are collectors. People get into collecting all sorts of things – model trains, commemorative plates, rare vinyl LPs, sports memorabilia – and, like other collectors, art collectors are passionate about trying to hunt down those rare pieces. Perhaps the most visible form of art collecting today, and the one that drives so much public discussion about art, is the art purchased for millions of dollars – the pieces by Picasso and Damien Hirst traded by the ultrawealthy. This is still social: Whether they are at Sotheby’s auctions or museum board dinners, wealthy art collectors mingle, meet and talk about who bought what.

Finally, I think many people buy art strictly as an investment, hoping that it will appreciate in value.

Is crypto art really that different?

If you look at the reasons people buy art, only one of them – buying art for your home – has to do with the physical work. Every other reason for buying art that I listed could apply to crypto art. You can build your own virtual gallery online and share it with other people online. You can convey your tastes and interests through your virtual gallery and support artists by buying their work. You can participate in a community: Some crypto artists, who have felt excluded by the mainstream art world, say they have found more support in the crypto community and can now earn a living making art.

While Beeple’s big sale made headlines, most crypto art sales are much more affordable, in the tens or hundreds of dollars. This supports a much larger community than just a select few artists. And some resale values have gone up

Value as a social construct

Aside from the visual pleasure of physical objects, nearly all the value that art offers is, in some way, a social construct. This does not mean that art is interchangeable, or that the historical significance and technical skill of a Rembrandt is imaginary. It means that the value we place on these attributes is a choice. When someone pays $90 million for a metal balloon animal made by Jeff Koons, it is hard to believe that the work has that much “intrinsic” value. Even if the materials and craftsmanship are quite good, surely some of those millions are simply buying the right to say “I bought a Koons. And I spent a lot of money on it.” If you just want an artfully made metal balloon animal, there are cheaper ways to get one.

Conversely, the conceptual art tradition has long separated the object itself from the value of the work. Maurizio Cattelan sold a banana taped to a wall for six figures, twice; the value of the work was not in the banana or in the duct tape, nor in the way that the two were attached, but in the story and drama around the work. Again, the buyers were not really buying a banana, they were buying the right to say they “owned” this artwork. Depending on your point of view, crypto art could be the ultimate manifestation of conceptual art’s separation of the work of art from any physical object. It is pure conceptual abstraction, applied to ownership.

On the other hand, crypto art could be seen as reducing art to the purest form of buying and selling for conspicuous consumption. In Victor Pelevin’s satirical novel “Homo Zapiens,” the main character visits an art exhibition where only the names and sale prices of the works are shown. When he says he does not understand – where are the paintings themselves? – it becomes clear that this is not the point. Buying and selling is more important than the art. This story was satire. But crypto art takes this one step further. If the point of ownership is to be able to say you own the work, why bother with anything but a receipt?

Manufacturing scarcity

It still seems hard to get used to the idea of spending money for nothing tangible. Would anyone pay money for NFTs that say they “own” the Brooklyn Bridge or the whole of the Earth or the concept of love? People can create all the NFTs they want about anything, over and over again. I could make my own NFT claiming that I own the Mona Lisa, and record it to the blockchain, and no one could stop me. But I think this misses the point.

In crypto art, there is an implicit contract that what you are buying is unique. The artist makes only one of these tokens, and the one right you get when you buy crypto art is to say that you own that work. No one else can. Note, though, that this is not a legal right, nor is there any enforcement other than social mores. Nonetheless, the value comes from the artist creating scarcity.

This is the same thing that has happened in the art world ever since photographers and printmakers had to figure out how to sell their work. In the world of photography, a limited-edition print is considered more valuable than an unlimited edition; the fewer prints in the edition, the more valuable they are. Knowing that you have one of a few prints personally made and signed by the artist gives you an emotional connection to the artist that a mass-produced print does not.

This connection could be even weaker in digital art. But what you are buying is still, in part, a connection with the artist. Artists sometimes publicly tweet their thanks to their crypto art patrons, which may strengthen this emotional connection.

A bubble bound to burst?

Personally, I want to buy only art I can hang on my walls, so I have no interest in buying crypto art. There are also environmental costs. Certain blockchains used for crypto art are really bad for the climate, because they require computations that consume staggering amounts of energy. That said, if buying it right now gives you pleasure – and you enjoy sharing what you have bought and the community around it and you are using a more environmentally friendly blockchain – that is great.

If you are buying it for some future reward, however, that is risky. Will people care about your personal virtual gallery in the future? Will you care? Will crypto art even be a thing in a few years? As an investment, it seems inconceivable that the higher prices reflect true value, in the sense of these works having higher resale value in the long term. As in the traditional art world, there are a lot more works being sold than could ever possibly be considered significant in a generation’s time. 

And, in the crypto world, we are seeing highly volatile prices, a sudden frenzy of interest, and huge sums being paid for things that seem, on the surface, not to have the slightest bit of value at all, such as the $2.5 million bid to “own” Jack Dorsey’s first tweet or even the $1,000 bid on a photo of a cease-and-desist letter about NFTs

Much of this energy seems to be driven by price speculation. It is also worth noting that the winner of the Beetle auction seems to be heavily invested in the success of crypto art. The cryptocurrencies that drive crypto art are often considered highly speculative. I have no doubt that, right now, there is a big NFT bubble.

Aaron Hertzmann is an Affiliate Faculty of Computer Science at the University of Washington. (the article was initially published by The Conversation)

The outlook for high street stores seems gloomy. Social distancing measures and lockdowns have driven people to shop online, leading to shop closures and a boom for online retailers such as Amazon. Before the pandemic, online shopping was a growing trend – and it’s possible that COVID-19 is the tipping point that will change how we shop for good. However, it is clear that people still value physical shops. Globally, after the first round of lockdowns in 2020, consumers flocked to the shops. At the Bicester Village shopping outlet in England, for instance, crowds were so great that people petitioned for shops to be closed.

The pandemic has caused people to spend much more time at home – and to appreciate a change of scene, which a trip to the shops can provide. Many may also cherish the social aspect of going shopping, especially after having been isolated for a period of time. Research carried out before the pandemic suggested that interactions with in-store salespeople could satisfy some of the social needs of consumers who experience loneliness. COVID-19 has also led people to new kinds of shopping experience. They have explored different types of shops, especially smaller ones that are local to where they live or work. In one survey of British adults, 70% of people shopping locally during the pandemic said they would continue to do so once it was over.

Other factors also come into play. Consumers often have a need to touch products and many find pleasure in the sensory stimulation of visiting a shop, which clearly can’t be replicated online. In fact, consumers are often motivated to touch products just because it is fun and this in turn can increase the likelihood of purchase. High street retailers can benefit from these consumer needs. 

Retailers should give some thought to the fact that consumers often spend more in physical environments than they would online. A physical store can also provide a good opportunity for consumers to return unwanted online purchases, and offers the opportunity to exchange or buy other products rather than just sending them back. This may be one way to combat the high return rates for online purchases, which are often around 30 percent compared to only 8% for in-store purchases.

Shoppers benefit from physical shopping, too. Social interactions have the ability to improve emotional well-being, and many people go on shopping trips with a companion, making it an inherently social experience. These social occasions will be important once our lives return to some kind of normality, as many have been starved of social interactions. 

One problem, though, is whether there will be any great choice of shops remaining on the high street, as physical stores disappear and brands become available only online. Recent examples in the UK include the fashion outlets Topshop and Miss Selfridge and the department store Debenhams. This may pose a dilemma for consumers when they wish to return to physical shopping after the pandemic, as there simply may not be enough shops to satisfy their needs. If there is a lack of variety then they may find that they are drawn back online, where they can order anything they want with the click of a button.

It is likely that in the future, consumers will want to combine purchasing online with shopping in person. A survey of 22,000 participants found that almost every single one would go back to shop in stores when the pandemic is over, even if 80% also said they would continue to shop online. This suggests that while many consumers are happy with their online shopping habits, they still have a need to go out to the shops. Perhaps this is the ideal time for high streets to reinvent themselves, offering consumers a more satisfying shopping experience that responds to their needs for social interaction and physical touch.

Cathrine Jansson-Boyd is a Reader in Consumer Psychology at the Anglia Ruskin University. (The article was initially published by The Conversation)

The rollout of vaccines across the U.S. has finally given hope to many employers of a return to some form of normality. Although the program has gotten off to a faltering start, the promise that hundreds of millions of employees could soon be vaccinated could provide a lifeline to businesses that rely on face-to-face customer service, such as restaurants and brick-and-mortar retail outlets, and also allow the reopening of offices across the U.S.

But can a company mandate its staff to be vaccinated? And what happens if an employee refuses to take the shot, citing their religious beliefs? These are not just hypothetical questions. A number of U.S. companies including airlines and restaurants have said they will require mandatory vaccines for their workforce. And as a law professor who has written about vaccination laws, I believe that in some circumstances, employers could find themselves on the hook for religious discrimination if their vaccination policies fail to offer a religious exemption.

What do the guidelines say?

In December, the Equal Employment Opportunity Commission – the body responsible for interpreting and enforcing federal anti-discrimination laws – issued guidelines addressing employees’ rights and COVID-19 vaccinations. It was the first time that the commission has provided an update on vaccines since the 2009 H1N1 influenza pandemic. Then, it advised employers that they should consider “encouraging employees to get the influenza vaccine rather than requiring them to take it.” 

Under the new guidelines, employers are allowed to adopt mandatory COVID-19 vaccination policies, but the commission warned that any such policy would be subject to certain anti-discrimination laws. In terms of religion, the commission points toward Title VII of the 1964 Civil Rights Act. This legislation requires employers to reasonably accommodate an employee’s sincerely held religious belief, practice or observance – but only if the accommodation can be made without “undue hardship” on the employer’s business.

The new guidelines echo earlier court rulings that take a broad definition of religion as including “moral or ethical beliefs as to what is right and wrong” that are held by the believer with the same sincerity as that of traditional religions. As such, opposition to mandatory vaccines could be made from members of smaller faith communities as well as from adherents of more mainstream religions. For example some Christian Scientists and members of the Dutch Reformed Church are opposed to vaccination. There have also been legal challenges brought where employees state that their Christian beliefs require they avoid inoculation. 

What is ‘undue hardship’?

Whether an objection on religious grounds is accepted will depend on whether it is deemed to not cause the business “undue hardship” – a phrase that has long been the subject of court interpretation. On this front, the new guidelines abide by the standard established in a 1977 landmark Supreme Court case, TWA v. Hardison.

In that decision, which focused on an employee’s request for time off for religious observance, the Supreme Court defined “undue hardship” as any cost greater than “de minimis,” or too small to merit consideration. In other words, in the case of COVID-19 vaccines, employers would not be required to incur even a minimal cost in accommodating an employee’s religious objection to receiving the COVID-19 vaccine.

But there remains ambiguity. The guidelines do not provide specific examples of what constitutes a “de minimis” cost. Previous court decisions make clear that “undue hardship” should be determined on a case-by-case basis.

In terms of COVID-19 vaccinations, workplaces such as bars, gyms and restaurants could conceivably claim “undue hardship” in accommodating religious exemptions to vaccinations on the grounds that doing so increases the spread of infection among their customers and employees. Similarly, health care facilities and hospitals could claim “undue hardship” due to the greater risk an unvaccinated workforce poses toward the vulnerable populations they serve.

In consumer-based businesses such as retail and restaurants, there could be an additional cost since the presence of unvaccinated workers could decrease the number of consumers or customers likely to frequent the businesses.

But at jobs in which employees work fully remotely and from home, employers might find it far harder to claim “undue hardship.” In such circumstances, employers are not likely to incur any cost in accommodating the religious employee’s objection, unless the employee themself becomes ill. 

In providing its guidance, the Equal Employment Opportunity Commission stresses that it has authority to interpret only federal law. It warns employers to check if state and local laws provide additional protection for religious employees. For example, in New York, employers must accommodate an employee’s request for religious observance when it can be done without the employer incurring “significant difficulty or expense.”

The risk of litigation

The cost of potential litigation alone may be cause for employers to think twice about not providing religious exemptions from any mandatory vaccine requirement. During the H1N1 flu pandemic, employees brought over a dozen cases challenging hospitals’ mandatory vaccination policies on religious grounds. The Equal Employment Opportunity Commission brought an additional three lawsuits.

The lawsuits were generally unsuccessful. But some plaintiffs were able to successfully persuade hospitals to settle, with the EEOC settling cases for amounts ranging from approximately $74,000 to $300,000

While the current guidelines are more permissive of vaccination policies than the guidelines issued during the H1N1 pandemic, it is impossible to know the exact approach that the Equal Employment Opportunity Commission will take regarding religious exemptions. Confronted with the worst public health crisis to hit the United States in a century, I believe the commission may be hesitant to bring litigation that broadly advocates for religious exemptions from vaccination.

There is a final wild card to note. In two recent cases brought to the Supreme Court, employees have asked the justices to overturn the court’s “too small to merit consideration” interpretation of “undue hardship” and instead define it as meaning a significant difficulty or expense.

The cases do not revolve around vaccinations, and the Supreme Court has not yet decided if it will hear either. But if it does and decides in favor of the employees, then employers will eventually face a higher burden when it comes to accommodating religious objections to mandatory COVID-19 vaccination.

Debbie Kaminer is a Professor of Law at Baruch College at CUNY. (This article was originally published by The Conversation).

Ethiopia has long been considered one of Africa’s economic wunderkinds. Until recently, it had relative political stability in comparison to other countries on the continent. And with an average GDP growth rate of 10 percent in the past decade and a government that instituted policies friendly to foreign investors, the country was able to attract South and East Asian clothing manufacturers, which sell to international brands, such as Calvin Klein, Levi’s, and H&M.

But for the past two months, violent conflict in Ethiopia’s northern Tigray region fueled by ethnic power politics has threatened the country’s stability. According to the International Crisis Group, the violence has likely killed thousands of people, including many civilians, displaced more than a million people internally, and led some 50,000 people to flee to Sudan. 

The scale of the conflict could scare off foreign investment in the country’s garment industry, a sector that is hugely important to Ethiopia, as it is aimed to propel its agricultural economy toward a more prosperous future built on providing clothing to consumers in the West. While the Ethiopian textile and garment industry is still small – its export share is not more than 10 percent of total exports, and its products only represent 0.6 percent of total GDP, the sector was expected to grow by around 40 percent a year in the next few years.

In March 2019, I assessed Ethiopia’s garment industry alongside two colleagues from the New York University’s Stern Center for Business and Human Rights. We wanted to see whether Ethiopia – as the new frontier of garment manufacturing – had learned from mistakes of other sourcing countries. We analyzed the industry’s prospects and the working conditions with a close look at the flagship Hawassa Industrial Park. This is a vast – and still only partly filled facility – which currently employs 25,000 workers about 225km south of the capital of Addis Ababa.

What we found was sobering.

Manufacturers told us about the many challenges of doing business in Ethiopia. These included bureaucratic and logistical hurdles and the problems that come with an unskilled workforce that had no prior experience of working in an industrial setting. Workers reported that they could barely survive with their base monthly wage as low as $26. The government’s eagerness to attract foreign investment led it to promote the lowest base wage in any garment-producing country.

In addition to this already-strained business context, the report we published points to what we saw as the greatest challenge of all: ethnic tensions. In Hawassa, for instance, ethnic tension erupted in July 2019 and caused disruptions to the industrial park. The new conflict in Ethiopia’s Tigray region could be the tipping point for foreign investors in the garment industry. Manufacturers had told us that further political instability in the country could jeopardize all future business.

The collapse of this sector would be disastrous. Tens of thousands of people would lose their jobs and the investments made in this enterprise wasted. In addition, foreign investors and the Ethiopian government need to understand that its collapse could have a symbolic knock-on effect in the region – Ethiopia’s garment sector is often seen as a pioneering experiment proving that structural transformation in Africa is possible.

Unmet promises

Before the onset of such tensions, garment manufacturers were already struggling to do business. Workers, unhappy with their working conditions and pay, were increasingly willing to protest by stopping work or even quitting. Attrition was high, and production was low. There are also problems with raw materials, almost all of which need to be imported into Ethiopia from India or China. The government advertised the availability of more than 3 million hectares for cash crops, including cotton cultivation in 2010. In fact, only about 60,000 hectares were being used by 2019 to grow cotton, and that figure is falling as local farmers switch to sugar, sesame, and other more lucrative cash crops.

Ethnic tensions disrupted factory operations further. When Abiy Ahmed took over as Prime Minister in 2018, his reforms – which aimed to create a more ethnically inclusive government – unsettled the ruling coalition and opened a political space for ethnic tensions to resurface. For instance, in Hawassa, a group of the Sidama people – who are the majority ethnic group in the Hawassa state – pushed for independence in 2019. The political uncertainty due to ethnic tensions translates into economic uncertainty for investors. 

In Hawassa, security concerns emerged for local workers and foreign staff. Night shifts had to be cancelled so that workers could get home safely before nightfall. Political demonstrations at the park’s fence and within the park disrupted production. Sidama people also mobilized within factories and demanded more jobs for their people resulting in short strikes and occasional park-wide closings. Such disruptions are a wild card beyond the control of investors, which may set back further investments.

By a thread

When the COVID-19 pandemic broke out in early 2020, the sector was hanging by a thread. In June 2020, the International Labor Organization published a report, which described reduced orders and a situation for workers even more perilous than before. By the end of 2020, many of the over 60,000 garment workers in Ethiopia had lost their jobs or were too afraid to return to work, fearing they would catch the coronavirus.

The current ethnic conflict could be the straw that breaks the camel’s back. For instance, the industrial park in Mekelle built for 20,000 workers – and with an occupancy in 2020 of around 3,500 workers – is currently closed. The current internet and phone blackout in the Tigray region now also makes any communication between buyers and the factories impossible.

A worsening human rights situation creates reputational and operational risks for investors and buyers. It increases uncertainty over the ability to complete orders and ship them on time. It also increases security risks for staff and workers. This may all cause long-lasting damage to investor confidence and the opportunity for sustainable economic development.

What must change

To assure investors, buyers, and international stakeholders, Prime Minister Abiy Ahmed needs to end the blackout in the Tigray region, better protect journalists and civilians, and allow for independent human rights monitors to assess conditions. More than that, at this critical moment, clothing companies and manufacturers invested in Ethiopia need to double down on their commitments to business in Ethiopia. This means they need to stay in the country and speak up to support human rights. 

Once ethnic tensions are defused, more work will still need to be done by both the government and foreign manufacturers to strengthen the sector. This includes developing a domestic supply chain and establishing a minimum wage that ensures decent living conditions for workers.

But first, the future of the industry must be secured.

Dorothee Baumann-Pauly is an Adjunct Professor and Director of the Geneva Center for Business and Human Rights at the Université de Genève. (This article was initially published by The Conversation).