NEW YORK – Ethiopia risks becoming the “next Bangladesh” by competing purely on cheap garment industry labour, according to new research. It is claimed the country had the chance to emulate China, where a focus on added value has helped boost wages for textile industry workers. Instead, the researchers claim, Ethiopia has set the bar too low in terms of worker wages, in the rush to lure inward investors. “The government’s eagerness to attract foreign investment led it to promote the lowest base wage in any garment-producing country — now set at the equivalent of US$26 a month,” says the paper.
Focused on the flagship Hawassa Industrial Park, it is also suggested local cotton crops and fabric suppliers haven’t materialised, so that local manufacturers at Hawassa still have to import nearly everything they need to make finished apparel.