If Ethiopia aims to become a world-leading manufacturer, it will very likely begin producing Made-in-Ethiopia-labelled clothing.
The country’s textile industry is, in fact, already buzzing, as seen with four recent events.
The Calzedonia Group (founded in Verona in 1987) opened a training centre in Ethiopia last year and is now planning to open a knitwear factory in Macallè by the end of this year. It is targeting Ethiopia because of its proximity to Europe (compared to Asia) and its low labour and energy costs.
Toyota recently acquired 40% of Hiroki Co. Ltd (which is building a leather footwear and accessories factory in the Mekelle industrial park) due to the high quality of local raw materials.
Bagir Group Ltd. recently acquired the remaining 50% (having acquired 50% in 2014) of Nazareth Garments – the clothing producer established by the Ethiopian government in 1991. Nazareth Garments is located 100km southeast of Addis Ababa (in Adama, in the Oromia region) and produces uniforms, work clothes and casualwear. The Israeli group looks set to become the most important manufacturer in Ethiopia, thanks to tax incentives and low production costs.
Ambassador Garment & Trade has doubled its production capacity. The Ethiopian label began in the early 1980s with just one sewing machine and now produces 500 men’s suits daily at its Gerji factory (close to the Bole district, where the Addis Ababa airport is located) and will soon establish another factory in Gelan, about 100km from Addis Ababa. Demand for suits is growing – mainly from students and workers in the banking and assurance sector. The company currently has 85 stores across Ethiopia and 750 employees, but these numbers are bound to rise.
Ethiopia is currently home to 115 textile factories and is attracting more investment and foreign capital – which will help drive the country’s industrialisation. Addis Ababa has launched a strategy to better exploit the potential of its already strong domestic textile industry and its growing human and material capital. Hawassa Industrial Park, Africa’s largest, is 270km south of Addis Ababa and is reserved to the production of fabric and clothing. It was built by China Civil Engineering Corporation and was inaugurated in June last year. According to Ethiopia’s Textile Industry Development Institute, 18 factories are now up and running. Producers include American PVH Corp. (whose brand portfolio includes Calvin Klein and Tommy Hilfiger), Hong Kong-based TAL Apparel (one of the largest clothing producers worldwide), six Ethiopian companies and various Chinese, Indian and Sri Lankan companies. The industrial park currently employs 10,000 people but has a total employment capacity of 60,000. Furthermore, the government predicts that the Hawassa Park will provide around 25% of the country’s textile exportations, valued at approximately USD 400m for the financial year that began on 8 July.
The birth of a real textile industry could be the turning point for Ethiopia’s economy, much as it was a key player in the first industrial revolutions in England and Germany in the second half of the 18th century. The Ethiopian textile industry – considered the sector with the most potential to increase exports, create jobs, and provide a model of know-how for other sectors – will be able to facilitate skill development through training, experience sharing and technology transfer.