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The Hub's AGOA expert contributes to McKinsey sourcing study

Published on May 07, 2015

The East Africa Trade and Investment Hub Trade Promotion and AGOA Director Finn Holm-Olsen took part in a McKinsey study dubbed "Sourcing in a Volatile World: The East Africa Opportunity" to uncover the true potential of East Africa's garment industry.

According to the survey, Ethiopia was identified by respondents as one of the highest potential buying locations over the next five years. Respondents also expected to raise their sourcing share from sub-Saharan Africa from 0.3% to 2.8% by 2020.

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The potential for East African countries in the industry is enormous, currently the combined share of global garment exports from Kenya, Ethiopia, Tanzania, and Uganda is only 0.07%.

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Furthermore, the report uncovered that while the garment industry in East Africa is relatively less sophisticated, it is considered the most dynamic.

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As labor costs rise in the Asian countries that currently dominate the garments production industry, it is expected that attention will shift to other sourcing destinations. East Africa appears to be well placed to take advantage of the changing landscape in the global apparel industry.

It is based on this potential that the East Africa Trade and Investment Hub is working in the East African Community countries as well as Ethiopia, Madagascar, Mauritius and Seychelles to enhance the textiles and apparel industry and promote exports under AGOA .