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MARKET SURVEY ON TEXTILE & CLOTHING    

(HS NO.50-56, 58-59 AND 60-62)

Product Description: 

This market survey covers the following products: (H.S Code Numbers 50-56, 58-59 and 60-62. These include silk yarn & woven fabrics of silk; Wool, fine or coarse animal hair yarn & woven fabrics of wool; cotton yarn & woven fabrics of cotton; other vegetable textile fibers, paper yarn and woven fabrics of paper yarn; sewing thread of man made filaments, synthetic filament yarn, artificial filament yarn and woven fabrics of synthetic filament yarn; Yarn of man made staple fibers and woven fabrics of synthetic staple fibers, metalised yarn, wadding of textile materials and articles; special woven fabrics, tufted textile fabrics; knitted or crocheted fabrics; articles of apparel and clothing accessories knitted or crocheted and men’s, boy’s, women’s, girls wears; men’s trousers; men’s, boy’s, women’s, girl’s shirts, blouses, etc; babies garments, pajamas, track suits, brassieres and other products, etc.

Ethiopian Textile and Garment Industry:

            The textile industry is the largest manufacturing industry in Ethiopia. The sector comprises a large number of state owned enterprises and a growing number of private sector participants at all levels.  The textile sector can be sub categorized into: Mills, Yarn, Garments and Fabrics.  The sector largely concentrates on cotton related products as this is a raw material that is available locally. The most recent Statistical Abstract indicates that there were 23 factories producing garments, of which 6 were public.  In addition, there are large numbers of artesian enterprises producing traditional Ethiopian-style clothes.  The state-owned garment enterprises are inextricably linked with the nine state-owned enterprises, six of which produce textiles, two yarns and sewing thread, and one blanket. 

The Ethiopian Government is planning to bring at least six global textile giants to the country during the fiscal year 2008/09 from target countries that include China, India and Turkey. In order to put this plan into action, the Ethiopian authorities had recently sent a delegation to Turkey for inviting investments.

The Ministry of Trade and Industry (MOTI) is eying on the textile sector as it wants to uplift this industry for generating foreign currency. The authorities aim to have yearly revenue of approximately US $500 million by 2011, for which the Government must bring nearly 190 enterprises that can make the capital investment of $1.6 billion.  MOTI aims to install around 48 units for threading, 31 for grey textile production, 22 in knitted sector, 53 in woven, 31 in garment and 6 for finished textile.

Ethiopian Imports:

The trend of Ethiopian imports of textiles and clothing is slowly increasing.  While in 2004 the total Ethiopian imports of textile and clothing were US$ 142.6 million, it increased to US$239.8 million in 2005, hence, showing an increase of 68%.  In 2007, the increase was 4.2 per cent over 2006.  India’s major competitors in this sector are China and Indonesia.

Detailed table showing Ethiopian imports of textile and clothing for the last four years are given below:-

COMPETITORS WITH THEIR MARKET SHARE

                                                                             Value in US$ Million

China, Indonesia, India and U.A.E are the major exporting countries importing textile and clothing to Ethiopia.  Their market share in Ethiopian imports was 70% (China 53.3%, Indonesia 5.8%, India 5.6% and U.A.E 5.3%).  The other major exporting countries with their share area: Thailand, Taiwan, Turkey, UK, Pakistan and Korea Rep. in that order.

ETHIOPIAN EXPORTS:

The domestic potential of cotton production, as a basic raw material to the fabrics and garments, is already established and availability of labor force is the major parameter for considering this sector as one of the strategic industries.  However, textile export is a very recent phenomenon for the country and it does not figure even among the top 10 export products of Ethiopia in 2006/07.  The factories were set up primarily for import substitution purpose and were neither technically nor did managerial equip to enter the export market.  Ethiopia had preferential access to the US market through the African Growth and Opportunity Act (AGOA).  Although the revenues the country secured from the AGOA market are less compared to major AGOA players.  During the last fiscal year the country earned over US$14.6 million from the export of textiles and garment sector. Major importers from Ethiopia were USA, Germany, Netherlands, France, etc.  Detailed table showing Ethiopian exports of textiles and clothing for the last four years are given below:-

India’s export:

India’s export in this sector cover silk, wool, and cotton yarns,  woven fabrics of silk; Wool, and cotton, sewing thread, polyester & Nylon yarns, metalised yarn, wadding of textile materials and articles; special woven fabrics, tufted textile fabrics; knitted or crocheted fabrics; terry toweling and similar woven terry fabrics, gauze, Labels, badges and similar articles of textile materials, articles of apparel and clothing accessories knitted or crocheted and men’s, boy’s, women’s, girls wears; men’s trousers; men’s, boy’s, women’s, girl’s shirts, blouses, etc; babies garments, pajamas, track suits, brassieres and other products, etc.

There is an increasing trend in Indian export of textile and clothing to Ethiopia.  While in 2003, Indian export was US$10.1 million, it increased to US$12.1 million in 2004 showing an increase of 20% which were worth more than US$13.4 million (CIF value) and accounted with 5.6% of the total Textile & Clothing imports into the country.  In 2006 the data shows a decrease of 38% compared to the year 2005 which were worth US$8.3 million.  However in 2007, it increased to US$15 million.

According to information obtained from the Directorate General of Commercial Intelligence and Statistics, following are the figures of Indian exports of Textile & Clothing to Ethiopia. 

                                                                                    FOB VALUE IN LAKH RUPEES

Analyzing the above figures, it is noted that Indian exports of Textile & Clothing to Ethiopia has increased in April 2007 to March 2008.       

DUTY STRUCTURE

Industrial Association:

The name, address with other details of the Industrial Association dealing with Textile & Clothing is given below:-

1. Dr. Worku Zewdie,

President,

Ethiopian Textile & Garment Manufacturers Association,

Addis Ababa(ETHIOPIA)

E-mail: etgma@ethionet.et

Telephone No.00 251-11-4421754

Fax No.00251-11-4421753 

2. Mr. Teshome Beyene,

Secretary General,

Addis Ababa Chamber of Commerce and Sectorial Associations,

P.O. Box 2458, Addis Ababa (Ethiopia)

Telephone No.00251-11-5518055/513814         

Fax No.00251-11-5511479

E-mail: aachamber1@ethionet.et

Website: www.addischamber.com

(This is the most important and active chamber of commerce in Ethiopia)

India’s presence in Textile & Clothing in Ethiopia

The Northern India Textile Research Association (NITRA), Ghaziabad and Pearl Academy of Fashion (PAF), New Delhi were jointly awarded consultancy project in June 2004 to set up the Ethiopian Textile and Apparel Institute (ETAI) to provide support to this sector. Their Business Plan has been approved and it is under implementation. Another proposal to develop handloom sector in Ethiopia has been submitted by NITRA to the Ministry of Trade and Industry in Addis Ababa. NITRA’s consultancy project and setting up of ETAI are expected to encourage Indian entrepreneurs in textile, garment and leather sector to come to Ethiopia for investment and joint ventures for which there is ample scope and export opportunities under AGOA and in COMESA market. NITRA has also executed a project to train local Sewing Machine Operators for capacity building in the garment industry.

A Capacity Building Initiative with Designers:

Embassy of India organized a series of workshop for Ethiopian designers with the aim of encouraging design/crafts and enhancing the fashion and lifestyle industry in Ethiopia.  The Initiative was launched on August 30, 2007 and the workshops began on October 15, 2007 and concluded on 3^rd November, 2007 with 50 participants who were divided into two categories: Fashion Women’s and Lifestyle Products, which was further divided into two subcategories of Lifestyle Homes & Lifestyle Personal Accessories.   The Initiative brought 3 experts from Pearl Fashion Academy, New Delhi and along with Dr. Neeti Sethi Bose, the Project Coordinator, a series of three intensive hands-on workshop were conducted where the participants went through exercise to learn pattern making and construction, necessity of designing, design basics, exploration of materials, the creative process, finishing and styles, understanding trends and markets, finding and translating inspirations into products and facilitated working with groups.  The workshop also invited experts and people from the industry in India and Ethiopia, to interact with participants, share experiences and present new ideas.  The workshops were very successful and proceeded in providing participants with basic understanding of design and designing for the contemporary market; it also encouraged designers to look at design, materials, markets and consumers from a different perspectives and has initiated a creative energy that is waiting to take shape into new garments and products they will henceforth design. 

Comments and Market Situation

• Ethiopia imported worth US$279.2 million of Textile & Clothing in 2007.  About 53.3 per cent of the total import into Ethiopia is made from China.

• The competition has become very intense due to penetration of low priced Chinese Textile & Clothing in the Ethiopian market. 

• Ethiopia has a large population and is potentially one of the largest domestic markets in Africa, although the purchasing power of the population is still limited.  Given the big size of the Ethiopian market, there is clearly a tremendous scope for the growth of India’s exports of Textile and clothing to Ethiopia if Indian companies could offer competitive prices, keeping the quality and delivery schedules.

• Participation of the Indian companies in Ethiopia trade fairs will be useful to create more awareness of the Indian products in the Ethiopian market.

• The Ethiopian government has identified Textile and leather sector as major areas of investment for 2008/09.  Thus, there are ample investment opportunities for Indian companies in manufacture of textiles in Ethiopia.

ADDIS ABABA (Ethiopia): November 2009

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