New Funding Arrives to Back Textile Industry

Oct 31 , 2020

A partnership between the United Kingdom, Germany and Ethiopia has availed 6.5 million dollars in funding to save textile and garment factory jobs at industrial parks. The fund is set up to support the country’s economic recovery from the Novel Coronavirus (COVID-19). Through the fund, textile factories can apply for wage subsidies – similar to the furlough schemes operating in many countries including the United Kingdom and Germany – and incentives to reward businesses that can adapt in response to COVID-19. The wage subsidy will cover a portion of total employment costs for textile factory workers in Ethiopia’s industrial parks. The Commercial Bank of Ethiopia will assess applications and disburse the funding to factories, while the UK Aid-funded FSD Africa will implement the project in partnership with First Consult. The Jobs Creation Commission estimates that between 1.4 to 2.5 million jobs could go over the next three months. The textile and garment factories in Ethiopia’s industrial parks employ 95,000 people. So far, 13 textile firms have fully stopped operating due to low demand and financial stress.  The funds will provide the factories with liquidity to maintain operations while protecting jobs.



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