Major brands are beginning to source from Ethiopia and Kenya
Major brands are beginning to source from Ethiopia and Kenya, according to a report in the latest issue of Textile Outlook International from the global business information company Textiles Intelligence.
Such interest is believed to stem from rising wages in China, labour unrest and violence in Cambodia, and ineffective compliance with rules and regulations in various countries in South Asia -- leading to fires and, in particular, the collapse of the Rana Plaza building in Bangladesh. Also, the governments in Ethiopia and Kenya are creating favourable conditions in order to attract investors.
In Ethiopia, several major foreign companies have invested in the textile and clothing industry and a number of high profile brand names have started sourcing apparel from the country, including: UK-based George at Asda (part of the USA-based company Walmart), Primark and Tesco; Sweden-based H&M (Hennes & Mauritz); USA-based Phillips-Van Heusen (PVH); and Germany-based Tchibo.
Also, several brands and retailers are reportedly in the process of setting up offices in the country, including Marks & Spencer from the UK, VF Corporation from the USA, and the Inditex brand Zara from Spain.
The increases in investment and sourcing from the country are reflected in employment and export figures. Between 2010/11 and 2013/14, apparel industry employment in Ethiopia more than doubled to 11,716 people, while textile and apparel export earnings rose from US$12.6 mn to US$111 mn.
In Kenya, as many as 46 apparel manufacturing industrial projects were approved by Kenya Industrial Estates in 2013. This was a record level and was more than double the annual average of 19 projects approved for the period 2009-12.
Furthermore, in 2014 delegations from several large companies interested in sourcing from Kenya visited the country. Among these companies were CherryField Sesby of Turkey, Li & Fung of Hong Kong and Phillips-Van Heusen (PVH) of the USA.
However, neither country has managed to create an internationally competitive cotton, textile and apparel value chain -- mainly because domestic supplies of raw cotton, capital and skills are insufficient.
In order to trigger a major shift of apparel orders from Asia to Kenya and Ethiopia, therefore, there would need to be a significant transfer of technology and management knowhow, and an influx of foreign direct investment (FDI) on a massive scale.
"Sourcing apparel from Kenya and Ethiopia" was published by the global business information company Textiles Intelligence in issue No 173 of Textile Outlook International.
Other reports published in the same issue include: "Editorial: Heimtextil goes from strength to strength and hosts a digital textile printing conference for the second year running"; "World textile and apparel trade and production trends: the USA, Argentina, Brazil, Colombia and Mexico"; "Trends in world textile and clothing trade"; "Product developments and innovations in the home textiles market"; and "Global and regional trends in mill consumption of textile fibres".
Textile Outlook International is published six times a year by Textiles Intelligence. Each issue provides an independent and worldwide perspective on the global fibre, textile and apparel industries.
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