Egypt’s garment and textile industry is witnessing remarkable growth, driven by global economic trends and a surge in foreign direct investment (FDI), according to Mohamed Abdel Salam, Chairperson of the Ready-Made Garments and Textiles Chamber at the Federation of Egyptian Industries.
Abdel Salam highlighted the significant appeal of Egypt’s investment climate to international manufacturers, attributing it to the country’s robust economic fundamentals and competitive production conditions. He remarked, “Egypt offers one of the most cost-efficient operational landscapes in the region.”
Competitive Edge in Costs
Recent data reveals several advantages that enhance Egypt’s competitive edge:
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Electricity Costs: At $0.07/kWh in Egypt, compared to $0.12 in other markets.
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Water Costs: Between $0.30 and $0.50 per cubic meter, versus over $1.50 elsewhere.
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Construction Costs: Ranging from $500 to $800 per square meter, nearly half the cost seen in competing countries.
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VAT Rates: Set at 14%, lower than the up to 18% in other nations.
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Wages: Competitive and well-aligned with regional benchmarks.
“These cost efficiencies have led numerous global players in the apparel industry to initiate or expand operations in Egypt,” Abdel Salam explained, further emphasizing the growing interest from investors in launching new projects across the country.
One of the latest developments in the sector is the expansion of the Turkish industrial giant, Shahinler Group. The company is actively working with Egyptian authorities to explore new investment avenues. Shahinler Group Chairperson Kamal Shahin recently held discussions with Minister of Public Enterprises Mohamed El-Shimy and the Industrial Development Authority, facilitated by the Chamber.
The talks centered on collaboration strategies and plans to relocate portions of Shahinler’s manufacturing operations to Egypt, focusing on cotton, spinning, weaving, and ready-made garment production.
Shahinler, which exports to 170 countries, has already invested $50 million in Egypt. This expansion is expected to create up to 3,000 new jobs and will require land allocations of 50,000 to 100,000 square meters. The new facilities are projected to produce 3 million pieces of formal wear annually.
“This is a clear signal that Egypt is not only a viable alternative but a preferred destination for global textile production,” Abdel Salam emphasized. He also stressed that the sector’s focus on export-oriented growth will remain a critical driver for attracting foreign investment and generating employment opportunities.
Strong Prospects for the Future
With cost advantages, an investor-friendly climate, and increasing contributions from global players like Shahinler Group, Egypt is positioning itself as a hub for textile production. The expanding garment and textile sector is set to play a vital role in strengthening the country’s economy, boosting exports, and creating thousands of jobs, solidifying Egypt’s status as a key player in the global textile market.
