Taiwanese Shoe Company to Construct Three Factories in Ethiopia

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After reaching a consensus for an agreement that will be signed on October 1, 2013, with the Ministry of Industry (MoI), George Shoe Corporation – a Taiwanese factory engaged in the manufacturing of leather shoes – is planning to construct three shoe factories. Based in Mojjo, Adama and Addis Abeba, the factories will come at an outlay of 50 million dollars.

The MoI agreed to give George Shoe 15,000sqm of land in theLemi Industrial Zone-a large plot of land lying on 156ha. The industrial zone, located in Bole District, is designed to help companies, such as – agro-processors, pharmaceuticals and textile manufacturers – produce and sell value-added goods and boost revenue from exports.

The Ministry also agreed to provide a 66ha plot of land in Adama, while it is considering the potential of availing up to 50,000sqm in Mojjo to the Company.

George Shoe Corporation, which was established in 1979, is now in the process of importing machineries to be installed in the factories, Fortune learnt.

The Ministry gave the Taiwanese investors priority, considering their potential, which will help the leather industry to gather momentum, Tadesse Haile, state minister for Industry, told Fortune.

“We considered their experience inChina, where they played a considerable role in scaling up the Chinese shoemaking industry,” Tadesse said. “The fact that they agreed to cover the whole investment cost also persuaded us to let them in.”

The factory to be erected in Mojjo will have a tannery and seven different clusters. These will be utilised for various uses, such as processing and decoration. This is estimated to cost George Shoe Corporation 355 million Br, while the shade construction will be undertaken at a cost of 569 million Br, according to an official with the Ethiopian Leather Industry Development Institute (LIDI).

The factory in Adama, according to the official, which will house accessories and components, will cost 93.5 million Br, while the shade construction will take 244 millionBr.

The Company is expected to commence production by March, 2014, with a capacity of 4,000 pairs of shoes a day, according to Tadesse. A hundred percent of the Company’s products will be for export.

A pair of shoes will sell up to 250 dollars in the international market, according to information obtained from the Company’s official website.

“We believe that this initiative will serve as a good precedent in pushing other exporters to do the same,” says Tadesse.

He is hopeful that the investment by the Taiwanese shoe manufacturer will help the country catch up with its Growth & Transformation Plan (GTP). In this, it was envisioned to collect close to a billion dollars in export revenue.