50 Turkish textile and garment companies are hoping to relocate factories to Ethiopia, with the support of Ayka Addis Textile and Investment Group, a Turkish company that made the same move three years ago.
Ayka submitted a proposal to the Ministry of Industry which has been already accepted.
Ayka Addis’ General Manager Ercan Turkoglu told Capital in an email response that an industrial zone will be built by Ayka Addis. “Two weeks ago Prime Minister Hailemariam Desalegn and other officials visited Ayka Addis and urged us to speed up the project’s preparation and feasibility study,” he said.
The government is currently allocating land around Addis Ababa for the construction of the industry zone. The construction which will consist of several five-storey buildings will be overseen by Ayka Addis which will then rent out or sell the constructed facilities to the new comers. The construction is said to be done in three phases.
“Concerning Ayka’s project to bring in 20 companies, the company has asked for four plots of land around Addis and it has also asked for another four plots of land for a different project it is engaging in. one plot of land has already been allocated around Ayertena area,” Tadesse Haile State Minister of Industry told Capital.
The Minister also stated that the project undertaken by Ayka is also targeting to export value added textile products. “This will be a big plus for the industry and will significantly contribute to the government’s plan to double the export revenue in the coming budget year” Tadesse added.
“Being a Turkish and an international garment industry for more than 25 years, we are in direct relation with all the major garment manufacturers in Turkey, we have been in dialogue with most of them for the last two years and most are willing to relocate at the earliest possible,” Turkoglu said.
The relocation of these companies is expected to create two billion dollars in export revenue for the country per annum and more than 60,000 job opportunities.
The government set out a target to earn one billion dollars from textile exports by the end of the five-year Growth and Transformation Plan (GTP). However in the just ended budget year the government only managed to get a mere 98 million dollars revenue.
The Turkish textile factory, Ayka, inaugurated its factory building at a cost of $140 million at Alemgena, 20km west of Addis Ababa.
Ayka launched in 2010, created jobs for more than 10,000 people and has the capacity to export textile products worth $100 million annually.
The Ethiopian Textile Industry Development Institute (ETIDI) also revealed that other textile companies are preparing to go into production, such as MNS Textile Company, which has built its factory in Legetafo, 15km northeast of Addis with one billion birr investment.
S.V.P is another textile company engaged in building its factory in Ethiopia. The new Indian company has invested around one billion birr for the construction.
Nas Foods, one of the leading biscuit manufacturers, is also involved in a new textile factory project located at Yirgalem, with an investment of 890 million birr.
ETIDI said that several South Korean textile companies will also be starting operations at Bole Lemi industry zone, which is under construction at a cost of 900 million birr by the Ministry of Industry. The construction for this specific project will be concluded this year and the industry zone will go operational.
In June 2012, the Ministry of Industry and Oromia Regional State signed an agreement with Turkish Investors for the development of 640 hectares of land at Legetafo.
The contract established that the investment on the land would include pharmaceutical, garment, leather processing and paper and packaging factories, amongst others.
The zone is set to include social service institutions such as health care, schools, technical and vocational training and hotels. It will be amongst the series of new industrial parks to be developed around the country.