CCTV news: “Strive to have 15,000 employees in Antai (Ethiopia) by the end of 2019.” Qian Anhua, chairman of Antai Group, set this year’s entrepreneurial goal.
This textile company from Zhejiang, China, has been planning to invest in Ethiopia since the second half of 2017. It is planned to invest a total of US$200 million in three phases to establish a complete supporting production base from fabric production to clothing processing in Adama City, 80 kilometers southeast of Addis Ababa, the capital of Ethiopia. .
In October 2018, Antai Esse Branch successfully completed the opening ceremony in Adama Industrial Park and overcame many difficulties. , successfully put into production.
On December 30, 2018, the first box export ceremony of Antai Esse Branch came to a perfect conclusion, becoming the first foreign-funded enterprise in Adama Industrial Park to achieve export earnings.
At present, the Antai Ethiopia branch covers an area of 140,000 square meters, of which the factory area covers an area of over 80,000 square meters and has more than 3,000 employees.
From February to August 2018, Antai Ethiopia Branch dispatched 100 Ethiopian college students to Huzhou, Zhejiang Deqing County Antai Headquarters receives skills training. After a year of hard work, most of the trainees have gradually taken up management positions and become the local backbone of the company’s expansion in Ethiopia.
Since Antai Esse Branch officially settled in Adama Industrial Park in September 2018, it has recruited about 1,500 people from surrounding villages to help the local government solve the problem of relocation of farmers in the industrial park. As for employment issues, local farmers have gone from joblessness and unemployment to employment, and they have begun to transform their careers. After a year of vocational training, the employees’ survival and life concepts have also changed. From being lazy and unruly, asking for leave at will, to going to work on time, helping each other and being friendly, they have become new models in Ethiopia.
There is no public transportation in the local area, and some employees walk 5 kilometers to work. In order to encourage and promote employment, Antai Ethiopia Company funded the rental of buses. Pick up and drop off employees and solve the problem of workers’ difficulties in going to work.
Due to poor infrastructure in local rural areas, most families use donkeys or manpower to transport water from water sources 5-10 kilometers away. In order to solve the drinking water problem of employees, they buy it from the market Drinking water is provided to employees, becoming the first company in Adama City to solve the problem of drinking water safety for employees.
In March 2019, when the rainy season was approaching, the company distributed free raincoats to every employee. It paid close attention to humanistic care and took every employee into consideration, hoping that they would Be a proud “Antai person”.
This international and humane management model has been highly commended by the Adama Municipal Government.
“Knowing is the beginning of action, and doing is the result of knowing.” Antai Textile settled in Ethiopia and became a member of the “Belt and Road” construction real map.
Extended reading:
Uniqlo: Chinese textile workers’ hourly wages have increased It cost twice as much, but you thought the cost was too high, so you went to Africa?
As competition in fast fashion intensifies, Uniqlo suddenly changes its sights and sets its sights on Ethiopia.
According to Nikkei Chinese website, Uniqlo, a subsidiary of Japanese retail giant Fast Retailing, will set up Africa’s first production base in Ethiopia. Africa, with its low wages, has been seen as a potential competitor for such jobs in places like Bangladesh and Vietnam.
Although this has not yet occurred on a large scale, Ethiopia has attracted investment from China, Japan and the United States, becoming Africa’s rising star on the world manufacturing map.
African Factory
Fast Retail Chairman and President Tadashi Yanai announced the above policy and said that Uniqlo will start trials of shirts and other clothing as early as 2018. Production, if it can stably produce low-price and high-quality products, Ethiopia will become its export base to the European and American markets.
According to reports, Uniqlo’s move is intended to provide price competitiveness to compete with global clothing giants. Although Uniqlo is performing strongly in its overseas business, mainly in Asia, competition with global clothing giants such as ZARA and H&M is fierce in Europe and the United States. In the latest fiscal year, Fast Retailing Group’s revenue recorded US$16.118 billion, a sharp slowdown from the 21.6% growth in fiscal 2015. Reducing costs has become the best way for Uniqlo to improve its competitiveness.
UNIQUEKu is not the only company that has discovered huge business opportunities in Ethiopia. Another giant in light fashion has long been targeting this land. H&M has made Ethiopia its most important procurement base in Africa since 2012. The US-based PVH Group has also worked closely with the Ethiopian government and invited its global suppliers to enter the huge modern industrial park built by the Ethiopian government in HAWASSA in the south. Huajian Group, China’s largest shoemaking company, has not fallen behind, investing approximately 12.3 billion yuan to establish a shoe industrial zone in Ethiopia.
Uniqlo does not have a small number of foundries in China, but due to rising labor costs, it has become a trend to move to new manufacturing depressions. Currently, Uniqlo has 88 factories in China, but in the past few years, the average hourly wage of Chinese textile workers has tripled. Ethiopia has developed a sewing industry with lower labor costs than those in developing countries in Asia. From 2006 to 2011, Ethiopia’s textile product revenue quadrupled. Also during this period, Ethiopian textile exports to Europe increased by 500%.
Thousands of advantages
No different from Uniqlo, with low labor costs This is the main reason why foreign-invested enterprises choose Ethiopia. Ethiopia has a population of approximately 100 million, of which approximately 45 million are in the labor force. However, per capita income in Ethiopia is extremely low, with the average monthly wage of workers being only US$50, compared with US$150-170 in Vietnam and US$400-500 in China. At the same time, because Ethiopia has not introduced a minimum wage system, the wage level in Ethiopia is also at a low position among African countries.
Ethiopia’s unique geographical location also provides opportunities for the development of manufacturing industry. Ethiopia’s proximity to six countries means that Ethiopia’s manufacturing industry has a wide market reach. The government’s continuous increase in investment in infrastructure has also accelerated the development of Ethiopia’s logistics industry, creating basic conditions for Ethiopia to become a new manufacturing center in Africa.
On the other hand, political stability is also a major factor that foreign investors consider. Shen Shiwei, a business and government relations consultant in Africa, said in an interview with a Beijing Business Daily reporter that in more than 50 countries in Africa, except for a few troubled countries, the overall situation is improving. The Ethiopian People’s Revolutionary Democratic Front is a powerful ruling party. Whether it is in terms of seat share or the implementation of national policies, it can effectively unite several major families to jointly promote it. There is no crisis of frequent political changes, coupled with the ruling party’s strong plan for national development, breaking the traditional first barrier to foreign investment.
The Ethiopian government has made great efforts to leverage its inherent advantages. At present, the Ethiopian government has opened a green channel for export customs clearance of clothing, allowing clothing manufacturing companies to obtain foreign exchange immediately and continuously reducing the cost of opening letters of credit. Ethiopia’s textile industry continues to develop due to the supply of high-quality cotton and relatively low-cost hydropower, which also provides an upstream foundation for the development of the apparel industry.
Avoid “heavy” and go “light”
Released by the World Bank The 2017 Global Economic Outlook report predicts that Ethiopia’s economy will grow by 8.3% in 2017, making it the fastest growing country in Africa.
Foreign media once called Ethiopia the most stable country in the “Horn of Africa”. For more than a decade, Ethiopia’s annual growth rate has been close to 10%, compared with just 3% in the early 1990s. Although the manufacturing industry has benefited Ethiopia greatly, there is still a long way to go if this structural situation is to be maintained for a long time.
The booming manufacturing industry has led to the rise of domestic industrial parks. At present, Ethiopia has elevated industrialization to a national development strategy, taking the construction of industrial parks and promoting production capacity cooperation with China as an important basis for realizing industrialization. However, the overall situation of the industrial park is not optimistic.
Shen Shiwei believes that Ethiopia does not have the conditions to develop heavy industry, and light industry is its only choice. Although there are currently a large number of industrial parks in Ethiopia, there is a lack of benchmarking companies. Because it is not an English-speaking country, its laws and regulations are not in line with international standards, and its finance is not open, Ethiopia has a low degree of internationalization and marketization, which is not conducive to the development of light industry.
On the other hand, agriculture, which plays an important role in Ethiopia’s national economy, also has certain problems.
Among Ethiopia’s 100 million people, agricultural labor accounts for more than 85% of the country’s total employment, agriculture accounts for about 47% of GDP, and 90% of foreign exchange comes from agricultural products. Exports are the backbone of the national economy and foreign exchange earnings from exports, and are also the main source of people’s income. However, Ethiopia’s current agricultural infrastructure is not perfect. Although irrigation and farming technology have been improved to a certain extent, some areas have still not got rid of the situation of relying on the sky for harvesting. Modern irrigation facilities need to be further promoted.
The development of agriculture is directly related to the development of light industry. Shen Shiwei said that “agriculture supports light industry, and light industry feeds back agriculture” is the right direction for Ethiopia’s development, but there is indeed much room for improvement in actual agricultural development. Coupled with competition from financially liberalized countries such as Uganda and Kenya, Ethiopia’s light industry may still have to overcome a series of difficulties in the future.
The Ethiopian government is obviously aware of this. For example, government departments have established a mechanism for regular consultations with embassy personnel on relevant issues of mutual concern and importance to both parties.
Africa, a new continent with extremely rich resource endowments, is attracting the attention of many Chinese superior textiles and garments with its comprehensive advantages such as demographic dividend, preferential export tariffs, and low energy costs.
It is said that “agriculture supports light industry, and light industry feeds back agriculture” is the right direction for Ethiopia’s development, but in reality there is still a lot of room for improvement in agricultural development. Coupled with competition from financially liberalized countries such as Uganda and Kenya, Ethiopia’s light industry may still have to overcome a series of difficulties in the future.
The Ethiopian government is obviously aware of this. For example, government departments have established a mechanism for regular consultations with embassy personnel on relevant issues of mutual concern and importance to both parties.
Africa, a new continent with extremely rich resource endowments, is attracting the attention of many Chinese superior textiles and garments with its comprehensive advantages such as demographic dividend, preferential export tariffs, and low energy costs. </p
