The once-thriving textile and garment sector in Ethiopia’s Tigray region, which served as a major economic backbone, has been severely devastated by the conflict in northern Ethiopia over the past two years. While the physical destruction and supply chain disruptions have been widely reported, a new study reveals that the greatest challenge facing investors and businesses attempting to rebuild is a chronic lack of capital.
The study, titled “Rebuilding Tigray’s Textile and Garment Industry: The Role of Vocational Skills Development,” documents extensive financial losses and infrastructural damage across the region’s industries. It reports that approximately 60 factories and over 6,300 small and medium-sized enterprises were destroyed during the war.
One prominent example is the Almeda Textile Factory, which before the war employed 5,300 permanent workers. Post-conflict, it has restarted operations but with a drastically reduced workforce of 1,800. Gebretsadik Gebru, a lead researcher on the study, shared with Capital that the factory’s monthly revenue plummeted from 70 million birr pre-war to just 5.5 million birr in 2024. Their production equipment and raw materials were entirely looted or destroyed, compounding recovery efforts.
The study, based on interviews with industry leaders, identifies financial constraints as the primary obstacle to business revival. The Almeda factory’s manager noted that out of 51 vehicles previously owned in Mekele, only one remains functional—the rest were damaged or stolen—forcing the company to rent transport at additional cost.
Beyond funding shortages, the war has triggered a severe skills gap. Thousands of skilled workers fled the region, forcing companies like MAA Clothing Factory to replace them with low-skill labor, thereby incurring extra expenses for training. The study emphasizes vocational skills development (VSD) programs as critical to rebuilding a capable workforce for a modern and resilient textile industry.
VSD programs would enable retraining of displaced workers and develop new talent attuned to the industry’s specific needs. However, the report highlights a disconnect between general technical and vocational education and training institutions (TVET) and the specialized requirements of the textile sector. While most TVET programs focus on trades like metalworking, Tigray’s textile industry demands specialized training on machinery such as ring frame and knitting machines.
To address these gaps, the study recommends close collaboration between TVET institutions and industry stakeholders to ensure that training matches both traditional textile skills and emerging technologies.
Gebretsadik called for coordinated actions by government, investors, and international organizations to support comprehensive recovery. He urged the creation of special economic zones and tax incentives to attract investment. Additionally, the study called for accessible low-interest loans, wage subsidies for rehired workers, and grants to support small businesses.
Crucially, there were appeals for the federal government to establish a development fund in partnership with local authorities to catalyze the sector’s revival.
