Archive AFDB Launches Fashionomics Initiative In Africa

AFDB Launches Fashionomics Initiative In Africa


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The African Development Bank (AfDB) is making progressive strides to fulfil its High 5 mandate. In May 2015, the AfDB, under the leadership of the Special Envoy on Gender, Geraldine Fraser-Moleketi, launched the Fashionomics – “the economy of fashion” – initiative during the Bank’s 2015 Annual Meeting in Abidjan. This initiative is aimed at offering support to micro, small and medium-sized businesses (MSMEs) in the fashion and textile industry in Africa.

Africa is known for its creativity and strong cultural background. This reflects in our fashion lifestyle. From Aso Oke & Adire in Nigeria, Kente in Ghana, Shweshwe in South Africa, Kitenge in Kenya, Africa’s history of fashion and textile reflects our ingenuity and creativity.

The Fashionomics initiative is commencing as a Business to Business (B2B) website. The online platform will become operational in the first quarter of 2017.  The dedicated website serves as a networking platform for all the links in the fashion and textile value chain- suppliers, brokers, designers, distributors and investors. It also acts as a place to share knowledge, tutorials and opportunities in the textile and fashion sector. The objective is to help members of the industry develop and boost their businesses. The website will be bilingual- English and French.

Credit: African Development Bank
Credit: African Development Bank

The Fashionomics Initiative is kickstarting with Ethiopia and Cote d’Ivoire as case studies. The two countries show the disparities and unique characteristics typical of the entire continent; Cote d’Ivoire is a French-speaking country and is located in West Africa, while Ethiopia’s official language is English and is located in East Africa.

In a report by the AfDB, Africa currently accounts for 1.9 percent of global trade. The global fashion industry is estimated to be worth $1.3 trillion. In Africa, the entire textile/clothing market is already worth more than $31 billion and accounts for the second largest number of jobs in developing countries, after agriculture. In the next five years, the industry could generate $15.5 billion revenue.

Africa’s fashion industry has already been experiencing great growth and investments. In Madagascar, AfDB is initiating an Investing Promotion Support Project (PAPI). It isinvesting about $10 million to boost the textile industry through the project.  The Textile Sector Promotion Support Fund (FAPST) has been created under PAPI to support and improve the capacities of MSMEs within the textile sector. PAPI will also initiate the establishment of a Textile Special Economic Zone (SEZ).

In Lesotho, the number of textile/clothing businesses has more than doubled since 1999. The sector, which represents 60 percent of the country’s exports, employs 80 percent of the manufacturing labour. Mauritius is another example; the country is leading the clothing textile exporting business in Sub-Saharan Africa, with over 250 businesses and US $761.3 million in revenue.

Credit: African Development Bank

The fashion industry in Africa employs a large percentage of women. In Ethiopia, 78 percent of workers in the textile and apparel industry are women. Women own 80% of businesses in Cote d’Ivoire’s textile industry. Fashionomics can boost the employment and empowerment of women businesses in the continent.

According to  AfDB’s report, the clothing textile industry could generate 400,000 jobs in Sub-Saharan Africa and exports could double in the next 10 years. Ethiopia is a case in point for job creation in the fashion industry. The Ethiopian textile/clothing industry has been growing at 51 percent over the past six years.

In 2013, H&M, Swedish clothing retailer started sourcing for Ethiopian garment producers. The company set up offices in Addis Ababa to get closer to suppliers. About 60,000 jobs have been created since H&M began chain operations in the country.  The low cost of labour in Africa in comparison with the increasing wages in Asia means more companies will be looking to move operations to Africa.

The deployment of Fashionomics has it challenges. Africa has the lowest e-commerce penetration rate. In 2013, Africa and the Middle East accounted for only 2.2 percent of global business-to-business e-commerce.

Textile production facilities are missing in most of the countries as they need more investment than apparel/clothing facilities. These industries are capital intensive. The huge capital requirement was one of the factors that led to the downfall of the textile industry in Nigeria. From over 175 functioning textile mills in the 1980s to less than 30 operational mills in 2016.

There is also constrained access to financing for entrepreneurs and SMEs. The cost of establishing a fashion business is high; electricity bills, labour costs, and taxes are high in Africa. In Cote d’Ivoire, material input represents up to 50 percent of product cost.

The cost of intra-African trade is relatively high as well. According to the World Bank, intra-African trade costs 50% more in Africa than in East Asia. Also, Africa’s intra-regional trade costs are the highest of any developing region.

Regardless of these challenges, the growth prospect of the fashion industry in Africa is promising. Governments need to foster the development of local suppliers, entrepreneurs, and regional value chains, ensure access to low-cost financing, build a more conducive business climate, buy from locally owned companies, invest in infrastructure and establish more educational institutions.

Textile and apparel suppliers also need to improve productivity by investing in new equipment and training, upgrade and diversify product portfolio, and establish long-term partnerships with buyers thereby increasing their customer base. Large global apparel groups need to recognise Africa as the future of manufacturing and production. And more strategic investments need to be made in Africa to proactively improve supplier capacity.


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