Ethiopia is emerging as an attractive garment manufacturing destination due to its stable democracy, rapid economic growth, and abundant cheap labor. Unlike some other countries where labor and infrastructure costs are increasing, Ethiopia is becoming a preferred choice for garment buyers. The Ethiopian government is actively encouraging investments in the textile and garment sector, leading to investments from countries like Turkey, India, South Korea, and China. This favorable investment climate is positioning Ethiopia as a potential hub for garment manufacturing in the near future.
Ethiopia, located in the northeastern part of Africa, is known for its stability, low crime rate, and minimal corruption compared to its neighbors. It offers a safe and secure working environment. Ethiopia’s strategic geographic location connects Africa to Asian countries and provides easy access to US and European markets. It serves as a bridge between raw material-producing Asian nations and consumer markets in the US and Europe.
Ethiopia’s industrial growth has been remarkable, with a GDP growth rate averaging 10.7% over the past decade. The manufacturing sector has also played a significant role, contributing 13.4% to the GDP in 2010-11. The Ethiopian government is committed to its ambitious Growth and Transformation Plan (GTP), resulting in a substantial increase in investments, estimated at nearly 250% to US $953 million, according to the United Nations Conference on Trade and Development.