ADDIS ABABA – Country’s manufacturing sector particularly the textile industry is steadily attracting notable Foreign Direct Investment (FDI). So far it has created some 110,000 jobs Ethiopian Investment Commission disclosed.
The industry has been propping up the economy via boosting up the light industry and attracting more FDI to the country, Public Relations and Communication Director Mekonnen Hailu told The Ethiopian Herald. Over the past five years, some 87 foreign companies including from US and China have engaged in Ethiopia’s textile industry. Of which, 48, 23 and 16 of the industries respectively are at operation, preimplementation and implementation phases with total 4 billion Birr capital, Mekonnen stated.
The industries are importing significant technologies and machineries to improve their productivity and operational capacity. They are also helping the nation earning significant forex exporting [promoting] Ethiopia’s textile and apparel product to US, EU Middle East and Asia and so on, he said. Beyond improving job creation and forex, the industries are enabling the nation to ensure knowledge and technological transfer through importing machineries and giving training to employees, he noted.
Accordingly, local textile industries are drawing lesson from their counterparts to know how to upgrade quality of products and be competitive on the international market, he disclosed. Ethiopia is a suitable land for textile and apparel investment having plenty of human and natural resources. The country has affordable labor force, three million hectares of land suitable for cotton cultivation, he said. Plus, there is state-of-the-art industrial parks specialized in the area equipped with low cost (electric) energy.
Furthermore, the country has proximity to the world markets, he noted. Moreover, the country has a duty free market access in US and Europe through AGOA (African Growth and Opportunity Act) and EBA (Everything But Arms) initiatives, he mentioned.
There are also incentives in the sector by the government including loan, tax exemption to import working machineries and materials and tax holiday period among others, as to him. However, there are still some hindrances raised by the companies including power fluctuation, shortage of forex and string business bureaucracies, he told.
As to him, the commission in collaboration with stakeholders is exerting efforts to curb the problems shortly. The government is also endeavoring to upgrade country’s ease of business doing. Ethiopia has a vision to be a leading manufacturing hub to African Nation by 2025, it was learnt.
The Ethiopian Herald, March 26/2019
BY YOHANES JEMANEH
