The textile and garment industry is among the rising sectors in Ethiopia. The country has easy access to the international value chain and has an abundant and workforce. Different incentives have been given to foreign investors and local small scale and medium textile and garment associations to encourage the sector. Small and medium industries have been given support in terms of structure, training, workshops, loans, machinery lease, finance, advice services, market linkages and the like.

The Textile Industry Development Institute provides chemical and environmental laboratory facilities, spinning, garment technology, weaving, knitting and training. The number of middle and higher industries of the sector has currently reached 161. Textile exports have grown from 0.9 to 3.8 per cent during 1990 to 1998.

Major challenges are: lack of inputs, skilled man power, and obsolete technologies. The sector needs committed and modern management systems to raise small industries’ baselines higher. Investors need to be briefed on the sector’s prospects and textile exports sector needs to be pushed. Its employment potential is being enhanced. The sector is expected to create more than 3,00,000 jobs during the plan period. Small and medium textile and garment industries are being given capacity building programs.