Egypt is geared to launch world's largest textile factory in El-Mahalla

The Egyptian textile industry dates back to the ancient times and the country has nurtured it into a flourishing industry today. They indulge in the complete production process right from the cultivation of cotton, to the making of yarns, fabrics, and ready made apparels.

Textile and apparel industry is the second largest sector in the country, next to agro, and plays a major role in shaping the Egyptian economy.

Apparel sector in Egypt

The apparel sector in Egypt accounts for 3% of the nation's GDP and 27% of its industrial output. Notably, 25% of the industry is focused on textile production, of which 12% is engaged in home textiles, 8% in cotton yarn, and 5% in other textiles.

Public sector dominates the production industry with 50% hold in spinning, 60% hold in hemming, and another 60% hold in weaving. The private sector owns 90% of the garment industry.

Spinning and weaving sectors are dominated by large scale industries with a strong influence of the public sector.

As per research data accumulated in 2010, Egypt's textile sector consists of 3,243 companies with a total investment of 3.2 billion USD. The industry produces 315 million apparels, and exports 305,000 tons of cloth and apparel annually.

The US constitutes 80% of the country's export market, with by EU and Arabian countries comprising the remaining 20%.

World's largest textile factory in the making

Latest intel suggests that Egypt is planning to give yet another push to the already flourishing industry. Prime Minister Mostafa Madbouly held a meeting in April, 2021 with ministers of trade and public enterprise to follow up on the construction of a textile factory in El-Mahalla that is meant to be the largest textile factory in the world.

The factory is supposed to be inaugurated in March 2022, spanning over an area of 62,000 square kilometers. The factory is estimated to have a daily production capacity of 30 tonnes. The plan was first announced in September 2019. El-Mahalla is the largest city in the Gharbia governorate and also in the Nile Delta.

In the meeting, Madbouly recommended that farmers should be incentivized to grow high-quality cotton to the extent that it would fulfil the needs of local factories. As part of this plan, five senior trainers will train 130 less experienced trainers, who in turn will train the workers, while state-owned companies would be developed in Cairo, Beheira's Kafr El Dawar, and other areas in the Nile Delta region.

Egypt’s plan to attract foreign investment to its textile and garment industry sectors have been hampered in recent years. The chief reason for this was the global fallout from the Covid-19 pandemic. This definitely was a blow to the industry but the government has promptly stepped in to spur the development.

The Egyptian government is also working on yet another major textile fashion enterprise. It is planning a textiles city in the Free Zones System in Minya governorate. The city would be built over 306 feddans (an Egyptian unit of area equal to 1.038 acres), and a company is to be established to manage the city. It is estimated that this project will generate more than 17,000 direct jobs and various other indirect employment opportunities for overseas market.

Factors working in favor of Egyptian textile industry

Egypt has several favorable factors which provide leverage to its textile industry. These are:

• An adequate supply of labor
• Competitive but stable wages
• Ideal geographical conditions for cotton cultivation
• Training programs run by the Government that facilitate upgradation of skills
• Perfect geographical location for export and import activities - Egypt has equipped with 15 commercial ports facilitating its exports.

The aforementioned conditions are a boon for Egypt. Coupled with the right investment impetus, the Egyptian market is set to become a strong player in the global textile and apparel industry.

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