Export Impact For Good

 
Countries / Territories

Egypt: Improving the international competitiveness of the textile and clothing sector (GTEX)

  • Objective | Sector Context | Beneficiaries | Contact information


    Objective

    The Egypt project has been developed within the framework of the GTEX MENATEX programme and is fully aligned to the programme’s approach and strategy. The envisaged impact of the project is to increase employment and income along the Textiles and Clothing (T&C) value chain. To achieve this long-term objective, the project foresees to accomplish two major outcomes until its end. One is related to the institutional infrastructure around the sector, including policy aspects, where required, and is formulated as “Improved business environment and Trade and Investment Support Institutions (TISIs) performance in the T&C sector”. The second outcome targets the enterprise level which is formulated as “Improved competitiveness of Small and Medium sized Enterprises (SMEs) in the T&C sector”. It will focus on capacity building of the private sector with a main focus on the clothing sector. Technical assistance consists of direct support to enterprises in selected sub-sectors as well as selected TISIs supporting the sector.


    Sector Context

    The textiles and clothing sector is Egypt’s second biggest industrial sector after agro-industry. It accounts for approximately 3.5% of GDP, 34% of industrial output and 14% of Egypt’s overall exports (Source: RMG Export Council).

    The T&C sector is comprised of about 4,000 companies, out of which only around 500-600 are exporting. Exporting companies are relatively well organised as compared to the majority of companies supplying the domestic market. The latter are often small companies operating in the informal sector. While no exact employment figures exist, estimations are that the sector employs up to 1 million people, the majority of them in the informal sector. While the textile sector (ginning, spinning and weaving) is still dominated by large state-owned companies, 90% of all clothing factories are private-owned.

    Exports consist mainly of ready-made garments and home textiles while some yarns and fabrics are also exported. Overall, T&C exports in 2019 stood at 2.8 billion US$ with 1.690 billion for clothing alone. The US was the largest export market with a share of about 56% followed by the EU with 30%.

    Clothing companies are mainly operating in the Cut Make Trim (CMT) business and perform simple sewing operations with low material sourcing, product development, design skills and low value addition. In addition, export management skills are often absent in many companies. This contrasts with a few vertically integrated companies that perform successful export operations and developed successful brands for the Egyptian and Middle Eastern market.


    Beneficiaries

    The direct beneficiaries of the project will be SMEs, including their employees and managers, as well as TISIs, including training institutions.

    The project will focus its support towards the clothing sector and especially towards three sub-sectors. Early analysis and stakeholder feedback suggest to work in active and sportswear, knitwear and men’s shirts. A maximum of 35 enterprises will be directly supported. The project will also support newly created enterprises under the “Your job next door” initiative.

    The project will partner with the Textile, Apparel & Home Textiles Export Council and also engage with the Fashion & Design Centre, Industrial Modernisation Centre (IMC), Technology & innovation Council and trade promotion agencies, such as the Export Development Authority (EDA) and the Egyptian Exporters Association (Expolink) to collaborate in project implementation and upgrade their service portfolio to members. The project will work with enterprises and these institutions to develop training approaches to allow enterprises to recruit personnel that meet their requirements.

    In addition, the project also established contacts with other supporting organizations such as the Foreign Trade Training Centre (FTTC), the Qualified Industrial Zone unit (QIZ), the Chamber of Textile Industry and the German Arab Chamber of Commerce and Industry.


    Contact information

    Matthias Knappe – GTEX MENATEX Programme Manager
    International Trade Centre, Geneva
    knappe@intracen.org
    54-56 rue de Montbrillant, 1202 Geneva, Switzerland
    Tel: (+41) 22 730 0321

    Yasmine Helal – National Project Coordinatior
    yhelal@intracen.org
    Tel: (+20) 10 2453 7536

  • Partners

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