With Sweden’s IKEA looking at the manufacturing hub of Ethiopia as a place to invest, one of Japan’s successful businesses, Uniqlo, is set to open its African manufacturing hub in Ethiopia in 2018. This is a major coup for Ethiopia as it continues to struggle to fill its industrial parks all across the nation that are barely occupied and emulate the success story of Asian nations.
The company is planning to manufacture T-shirts in the initial stages for its stores in North America and Europe and expand as it fulfills quality and quantity quotas, according to Tadashi Yanai, the chairman and CEO of the Fast Retailing behind Uniqlo. With wages in the Asian market on the up, many manufacturers are looking at the Ethiopia market as the next frontier looking for cheap labor costs and living standards.
Ethiopia currently does not charge any taxes for export as a strategy to attract foreign investors and create jobs for young people. The country’s geographical location as one that is close to the European destination is said to be what has also attracted the company to move some of its operations in Ethiopia. This follows the footsteps of other brand name companies such as Sweden’s H&M and a slew of Chinese companies that have some operation in the country.
Fast Retailing has its biggest manufacturing operations in Bangladesh that was started in 2008 in the midst of pressing issues such as child labor, human rights abuses and lack of safe working condition in the South Asian nation.
It currently has 1920 stores around the world and prides itself of its corporate responsibility mantra that has propelled it to donate clothing to emerging nations such as Syria, Rwanda and Ethiopia.