Given the significant development of labour-intensive textile industry, Ethiopia is eventually becoming the most sought after destination for production. And the ever busy workers of the huge GG Super Garment factory in Debre Zeyit, Ethiopia prove this fact. The company has hundreds of women and men sewing singlets and T-shirts for the Swedish company H&M.
Factory Manager Joseph Elisso said, “Ethiopia is stable and peaceful, electrical power is cheap and labour costs are very low.” With the rising prices and growing labour unrest in Asia, Ethiopia is attracting many foreign companies like H&M to start sourcing from Ethiopia. The country has a huge workforce and would like to become the next international textile hub.
Kanoria Africa Textiles establishes new denim fabric facility in Ethiopia
Kanoria Africa Textiles has set up an integrated denim fabric plant at Bishoftu, Ethiopia. The plant, being set up through an investment of US $ 50 million, covers 16 acres of land 50 km off the Ethiopian capital Addis Ababa. The unit which has spinning (1,440 rotors), weaving (60 looms) units, a dyeing facility and a finishing line, will have the capacity of producing 12 million metres of fabric every year. It also has access to local long-staple cotton, low-cost energy, duty-free access to the US, Canada and EU and tax incentives.
Recently a Korean delegation comprising giant textiles industrialist of Korea visited Ethiopia. Kihak Sung, Chairman, Korea Federation Textile Industries said, “The existing stable political system together and the favourable investment climate in Ethiopia have attracted Korean textile manufacturers to invest in the sector.” He added that by using Korean technology with Ethiopian labour force, Korean industrialist visualise making Ethiopia a textile hub.
Raymond to establish facility in Ethiopia
Raymond is planning to set up a manufacturing facility at Awasa in Ethiopia with an investment of around US $ 100 million. The unit will be housed in Raymond’s fully-owned subsidiary Silver Spark Apparel through its Middle East based unit in Sharjah. The facility will have a 2 million per annum capacity to manufacture and export woollen-blended, cotton blended jackets.
It is assumed that if Raymond exports to the US from Ethiopia it would not pay import duties of 18% which it would need to pay if it exports from India. Gautam Hari Singhania, Chairman and MD of Raymond said that the move to Ethiopia comes with the globally favourable trade policy reforms allowing the company to improve its export competitiveness.
Entry-level salaries for workers in Ethiopia’s textile industry range from US $ 35 to US $ 40 (32 to 37 euros) per month, even lower than Bangladesh’s minimum wage, which is US $ 68 per month, and far below the average wage of US $ 500 in China. Though the Ethiopian workers are struggling to make ends meet and regularly complain about their low wages but they are also optimistic as increasing foreign investment is bringing them jobs.
