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Chinese shoe companies set up factories in Ethiopia

China’s largest exporters of footwear HuaJian plans to invest millions of dollars in Ethiopia expanding factories, a sign that Chinese manufacturers are considering moving their factories in Africa, in order to enjoy preferential tariffs and lower labor costs.

Hill Fei Jie as Tommy (Tommy Hilfiger), Giles (Guess), Naturaliser, Clarkes and other Western brand OEM Jian Hua, the Chinese mainland has 25,000 employees. A year ago, China Jian outskirts of an industrial park in Addis Ababa, opened its first factory.

Responsible for plant operations Yu Hai quite satisfied with the results that she finalized the construction of a new production line of plastic shoes. 36-year-old Yu Hai is an actuary educated in England.

This will allow Ethiopia to add this plant hundreds of workers. Ethiopian economy is the continent’s fastest growing economies in the world, the country’s leather industry is very mature, but the unemployment rate is very high.

Yu Hai to the British “Financial Times” said that China-Africa Development Fund and Kennedy also (China Africa Development Fund) signed an agreement to jointly invest in a decade $ 2 billion, focusing on development in Ethiopia shoe manufacturing clusters. She said that this is expected to create 100,000 local jobs. China-Africa Development Fund China Development Bank (CDB) owned by a private equity fund.

She said: “We hope to use it as a platform to attract other shoe companies, if five years later still only one shoe business here, I think the Chinese firm should leave Ethiopia.”

She added that, in order to maintain long-term low-cost, Ethiopia must create economies of scale to encourage subsidiary industries.

Hua Jian ambition compelling reason is that the company’s long-term prospects of the Ethiopian manufacturing confidence and Chinese and African officials formed the view is just the opposite; African officials tend to believe that China’s main objective in the African continent is the exploitation of raw materials, and to find markets for China’s exports of manufactured goods.

Hai Yu said, which is similar to the business logic of the European footwear manufacturers had moved from Europe to Japan and China Taiwan, then when rising labor costs in these places after he turned to China mainland.

She said that despite the introduction of Chinese technicians and had imported parts, management and logistics costs are high, but offset these negative factors that, where labor costs are lower, and Africa to the United States and the European Union (EU) can enjoy preferential export tariff.