According to a survey by the American management consulting firm McKinsey, African countries appear for the first time on the list of countries expected to play an increasingly important role in the garment manufacturing industry, especially Ethiopia, which ranks seventh in the world. East Africa is the most attractive place for international buyers to purchase clothing in Africa, with Ethiopia and Kenya performing the most prominently.
By visiting garment factories, interviewing manufacturers and buyers, analyzing market data, and conducting a survey on 40 chief apparel purchasing representatives titled “East Africa: The Next Garment Purchasing Center?” 》In the survey, McKinsey concluded that Ethiopia has a relatively obvious cost advantage, while Kenya mainly has higher production efficiency, and Mauritius ranks third.
According to the report, Kenya’s export apparel industry mainly produces large quantities of basic clothing such as trousers, which mainly benefits from the United States’ African Growth and Opportunity Act (Agoa). In 2013, 92% of Kenya’s apparel exports were sold to the United States. Currently, more than $400 million in jeans, towels and other clothing consumed in the United States comes from Kenya’s Export Processing Zones (EPZ), and this figure is expected to reach 100 billion shillings (approximately $970 million) by 2018.
In recent years, the production capacity of Kenyan garment factories has increased significantly, mainly due to foreign direct investment from Asia and the Middle East, and the Kenyan government has strongly supported the development of EPZ. But at the same time, Kenya still faces many challenges. First, Kenya lacks local upstream industries, so manufacturers need to import fabrics, making delivery times longer. Secondly, labor costs in Kenya are relatively high. The average monthly salary of garment workers is about US$120, while in Ethiopia it is only half that. At the same time, the cost of a Kenyan work visa is about 10 times that of Ethiopia. Third, energy costs are higher. Due to unstable power supply, the factory needs to use its own generator, which costs four times more than directly purchasing the electricity from the grid. Finally, Kenya also needs to address issues such as corruption, high crime rates and social responsibility. East Africa will become an emerging apparel procurement center, with Kenya performing well
East Africa will become an emerging apparel procurement center, with Kenya outstanding
According to a survey by the American management consulting firm McKinsey, African countries appear for the first time on the list of countries expected to play an increasingly important role in the garment man…
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