Strengthening the Environmental, Social and Governance (ESG) practices to attract sustainable investments for innovative technology and knowledge transfer in Ethiopia’s textile and garment sectors

Strengthening the Environmental, Social and Governance (ESG) practices to attract sustainable investments for innovative technology and knowledge transfer in Ethiopia’s textile and garment sectors

ADDIS ABABA, 16 September 2022 – Improved Environmental, Social and Governance (ESG) practices – next to price and quality of products – are key success factors for competitive textile and apparel industries - that was the main message reflected at the international conference on triangular cooperation to promote sustainable textile investments and operations in Ethiopia. The Conference was organized by the Ministry of Industry (MoI) of the Federal Democratic Republic of Ethiopia, the United Nations Industrial Development Organization (UNIDO), and the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ). 

In his keynote remarks, the Minister of MoI, Melaku Alebel, said: “In our path to industrialize Ethiopia, the Government is committed to making the sector globally competitive and bringing the necessary structural transformation to the textile sector for a better partnership among Ethiopian textile industries, Chinese businesses, and international brands.”  

The Minister added, “As the development of the textile and apparel sector accelerates in Ethiopia, the foreign direct investments especially from Chinese enterprises have been taking on a remarkable momentum. It is timely and relevant to create a platform to exchange ESG best practices and foster sustainable environment in the textile sector of Ethiopia.”

Ethiopia’s favorable investment environment, including lower cost of production and preferential tariff policy has significantly increased the number of Chinese investments in the textile and apparel manufacturing sectors.

“UNIDO is committed to promoting inclusive and sustainable industrial development in Ethiopia,” said Aurelia Patrizia Calabrò, UNIDO Representative and Director of the Regional Office Hub in Ethiopia.

Calabrò underlined that UNIDO will continue supporting the Government of Ethiopia and the private sector to promote sustainable textile investment practices. UNIDO will also implement initiatives to increase the supply of quality raw materials, in addition to upgrading the skills of the sector’s workforce.  Capacity building efforts will also continue to complement the technical cooperation support.

“As a sunrise industry of Ethiopia, the textile sector enjoys tremendous opportunities for development,” said Zhiyuan Zhao, Chinese Ambassador to Ethiopia. “China always attaches great importance to the cooperation with Ethiopia’s textile sector, and consistently supports and contributes to the sustainable development of Ethiopia’s textile and garment industries.” The Ambassador emphasized that China also hopes that the Ethiopian Government will continue to prioritize the creation of a better investment environment and that China looked forward to strengthening collaboration with Ethiopia.

In his opening remarks, Heiko Nitzschke, Chargé d'Affaires a.i. and Deputy Head of Mission of the Federal Republic of Germany to Ethiopia, emphasized that Germany is a strong promoter of sustainability standards.  In Ethiopia, Germany has been a long-standing partner in the promotion and the creation of decent jobs. Germany has also provided support towards more ecologically friendly textile and garment production. Through its implementing agency GIZ, Germany is contributing to the capacity building of companies to help them make their operations greener and fairer whilst keeping high quality standards.

The China National Textile and Apparel Council (CNTAC) and the Ethiopia Manufacturing Industry Development Institute (EMIDI) signed a Memorandum of Understanding at the Conference.  Alongside this signing, the Conference also launched the ESG knowledge hub.

This project, “Sustainable Textile Investment and Operation in Ethiopia” is jointly funded by the Ministry of Commerce of the People's Republic of China (MOFCOM) and the German Federal Ministry of Economic Cooperation and Development (BMZ) and implemented by UNIDO in cooperation with the United Nations Global Compact (UNGC), the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), China National Textile and Apparel Council (CNTAC) and the Ethiopian Textile Industry Development Institute (ETIDI). The project commenced in July 2020 after a partnership agreement was signed between MOFCOM, MoI and BMZ.

For more information, please contact:

Jinjiang YAN, Industrial Development Officer

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