Chinese, South Korean, Indian apparel makers landing in Ethiopia

July 17, 2017
               News

Young, low-wage labor attracting garment companies from around world

MASANORI TOBITA, Nikkei staff writer

ADDIS ABABA -- Ethiopia is fast developing into a dynamic apparel-sourcing hub as low labor costs lure international clothing makers to the African nation.

Manufacturers from China, South Korea, India and other countries have opened new plants in the continent's second most populous nation while a growing number of European and U.S. brands are sourcing garments there.

A significant factor in Ethiopia's emergence on the clothing scene is the planned opening of a new railway line to a port in neighboring Djibouti, located on the Horn of Africa in the Arabian Sea. The railway will facilitate transport of goods from the landlocked country's industrial areas, like the Bole Lemi Industrial Park, an hour's drive from the capital Addis Ababa.

Opened in 2015, the sprawling 150-hectare park is bustling with Chinese, Taiwanese and South Korean production facilities, conveniently clustering factories for textiles, apparel products and leather shoes in one area.

At a factory operated by Shin Textile Solutions, a South Korean company, workers sit at long rows of machines sewing mainly sportswear. According to the general manager, the plant's entire output is exported, with about 60% going to Europe, 20% to the U.S. and the remainder to Asia.

Japan's Fast Retailing, which manufacturers and sells casual clothes under the Uniqlo brand, is among the many apparel makers that has shown interest in the plant, the manager said.

Drive to industrialize

Ethiopia's main exports currently include coffee, gold and leather products, but the government is stepping up efforts to develop new industries. Arkebe Oqubay, special adviser to Prime Minister Hailemariam Desalegn, has pledged to transform Ethiopia from a farm economy into an industrial powerhouse.

As part of its efforts to turn the country into an thriving, middle-income economy by 2025, the government has been building industrial parks. The newest is Hawassa Industrial Park, a one-hour flight from the capital. Among the 15 companies with manufacturing facilities there is PVH, a U.S. apparel company.

PVH's 280 employees produce garments for a number of international brands including Calvin Klein, then exports them to Europe and the U.S.

SOURCE : NIKKEI ASIAN REVIEW

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