William Davison Addis Ababa
ETHIOPIA’S Almeda Textiles, which sells clothes to Swedish fashion chain H&M, plans to increase revenue by 50 percent to $30 million (R365m) a year by 2018 by upgrading factory equipment and training staff.
The company will invest in its only plant near the city of Adwa, in Ethiopia’s northern Tigray region, Almeda’s general manager Libelo Gebreselassie said earlier this week.
He declined to say how much would be spent. The company, which began operations in 1998, could supply H&M with more than 4 000 t-shirts a day next year if productivity improved, he said.
“We’re upgrading our internal capacity,” Libelo said at Almeda’s offices in the capital, Addis Ababa. If the company could boost capacity and reliability at the plant, H&M might increase its orders, he said.
Almeda is owned by the Endowment Fund for the Rehabilitation of Tigray, a group of companies started in the mid-1990s by the Tigrayan People’s Liberation Front party, which is a founding member of Ethiopia’s ruling coalition. It’s been supplying H&M, Europe’s second biggest clothing retailer, since 2013.
H&M could not comment on its relationship with Almeda for “competitive reasons”, spokeswoman Anna Eriksson said. The vendor of $9.95 beach dresses said yesterday that the rising dollar drove second-quarter profitability to the lowest level in nine years.
Ethiopia’s government planned to invest about $1bn a year in export-focused industrial parks that would contain textile factories among other manufacturing sites, Arkebe Oqubay, a special adviser to Prime Minister Hailemariam Desalegn, said last month.
While Africa’s second most-populous nation has a target to earn $1bn this year from textiles and clothing exports, it shipped only $70m worth in the nine months to March, according to the trade ministry. – Bloomberg