Ethiopia – To Become One Of The Next Textile Manufacturing Hub Of The World

Ethiopia is all set to become one of the next textile manufacturing hubs of the world with its wide and young labour pool, growing market ability, advantageous trade agreements, including the future African Continental Free Trade Area (AfCFTA), and strategic position.

The International Trade Centre (ITC) organized, under the Partnership for Investment and Growth in Africa (PIGA) project, a dialogue on Ethiopia’s capability to become the next textile and apparel (T&A) supply base for the world.
The talk was organized in partnership with the Ethiopian Investment Commission (EIC) and the China Chamber of Commerce for Import and Export of Textile and Apparel (CCCT).

The event assembled more than 100 international buyers, potential Chinese investors, representatives of Chinese and foreign-owned companies in Ethiopia and representatives of Ethiopian institutions.
It was followed by field visits to T&A factories in various industrial parks around Addis Ababa.

The government has also prioritized the development of this sector, set up the Ethiopian Textile Industry Development Institute (ETIDI) to build-up the overall value chain, and created a helpful investment climate for the sector.

Mr. Zhang Xi’an, the Vice President of the China Chamber of Commerce for Import and Export of Textile and Apparel (CCCT), explained, “I led several missions of potential Chinese investors to Ethiopia in recent years and observed the great progress made in the development of the industry. I believe Ethiopia can become an important T&A manufacturing hub.”

Mr. Sileshi Lemma, the Director General of the Ethiopian Textile Industry Development Institute (ETIDI) added, “Chinese investment has contributed to the growth of the sector through knowledge and technology transfer, closing local companies’ capital gap and opening up new markets, and the government is looking forward to working with more Chinese investors and international buyers to further develop the sector.”

Mr. Anas Tazi, Country Leader for Decathlon in Ethiopia said, “We now have an office in Ethiopia and we are focusing on long-term development.”

Mr. Arwin Ludiansyah, Country Controller of H&M Ethiopia Production Office, pointed out that, “Ethiopia may be able to develop the sector more quickly than other countries have in the past because of technological advancement and lesson learning.”

“The T&A sector stagnated for many years, but it has been growing quickly in the recent years, mostly due to foreign investors. The CMT (cut, make and trim) purchasing model can only be a stepping stone for the sector’s growth”, Mr. Goshu Negash, President of the Ethiopian Textile and Garment Manufacturers Association, explained.

Along with the helpful discussions, the event enabled PIGA to make progress on three investment projects in Ethiopia’s textile sector.
The projects, worth approximately $100 million, have the prospect to create an estimated 10,000 jobs, mostly for young women. These projects should materialize in the coming months.