Swiss Consultant to Help Factories Boost Exports to U.S.$1 Billion

Addis Fortune (Addis Ababa)

Workineh Zewdie

9 May 2011

A Swiss consultancy firm is to arrive in Addis Abeba this week to advise textile and garment factories on moving towards international standards in a bid to boost the country’s export revenues from the textile sector to one billion dollars by the 2014/15 fiscal year, as set out in the GTP.

A benchmark study on the problems faced by local factories was conducted by Gerzi, which was established in 1929 in Zurich, in March 2011.

The gap analysis and action plan for the implementation of the study was also conducted by Gerzi, a consultant in the areas of textiles, apparel, and fashion.

The action plan is to be implemented by Gerzi’s 25 professionals from the textile and garment sector on seven local textile and garment factories.

The factories are MAA Garment and Textile Factory Plc, Almeda Textile Factory Plc, Adama Yarn Factory Plc, Concept International Garment Factory Plc, GMM Garment Factory Plc, Haile Garment Factory Plc, and Mulat Garment Factory Plc.

The project will be implemented in collaboration with the Ministry of Industry (MoI), the Textile Industry Development Institute (TIDI), and representatives of factories over the next six months.

“Upon the conclusion of the project, we are expecting direct and indirect achievements in the industry,” said Yewelsew Lalelet, public relations officer of TIDI. “Directly, the efficiency of the factories would improve to move closer to international standards. Indirectly, a technology and knowledge transfer would have taken place.”

Funding for the implementation was obtained from the Engineering Capacity Building Programme (ECBP) and Ethiopian Competitiveness Facilitation (ECF), which was established by the Ethiopian government and the World Bank (WB) with the aim to build the capacity of the export industry.

During the 2009/10 fiscal year, the country obtained only 14.6 million dollars from the textile sector. This year’s revenues have already exceeded the past year’s revenues by 25.5 million dollars, an increase of 175pc.

Export revenues from the textile sector reached 40.1 million dollars over the past nine months, according to MoI’s third quarter report.

Ayka Addis Textile & Investment Group Plc contributed the bulk with 23.3 million dollars. Of the factories selected for the project, MAA Garment was the highest earner.

The producer of woven and knitted garments earned 3.4 million dollars, according to a report by TIDI.

MAA Garment is a subsidiary of Kebire Enterprises Plc, which was established in April 2011 and is registered in Mekelle.

It was followed by Almeda Textile and Adama Yarn which earned 1.9 million dollars and 1.2 million dollars, respectively, according to the report.

MoI initially planned to implement the study on 17 of the more than 70 textile and garment factories in the country. However, the contract for 10 of the factories, which had been concluded with Sitra Consortium, an Indian company, was cancelled due to a disagreement between the company and MoI over the implementation.

“The implementation is expected to boost production efficiency as well as solve problems related to the management, marketing, and customer relations of the selected textile factories,” said Endalew Desalegn, director of planning and information at MoI. “It will also include appraising the competence of employees on each level and try to fill the gaps.”

In order to improve the capacity of the textile and garment industry as a whole, the government should exempt factories from imports duties on semi processed textiles from which products for local markets will be manufactured, according to Kassaye Mekuria, president of Ethiopian Textile and Garment Manufacturers’ Association (ETGAMA).

Similar capacity building trends had been followed in the textile industries of Mauritius, Sri Lanka, and Vietnam where successes has been attained, Kassaye claimed.

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