Though the industry is expanding 45,000qt of cotton was imported last fiscal year

The UK government is funding a 15-year cotton strategy for Ethiopia with intent to have a new institutional arrangement for cotton development.

This was announced by the Ministry of Industry in an international bid to hire consultants using money availed by the Department for International Development (DfID).

The decision to develop a strategy followed an agreement that the Cotton Development Directorate (CDD) at the Ethiopian Textile Industry Development Institute (ETIDI) was no longer enough to administer cotton development, calling for a higher structure, according to Bante Kasse, director of CDD. The problems, which are said to be above the CDD, are, rising demand, complexity of the increasing number of textile industries and supply value chain.

Currently, a total of 136 textile and garment factories, at medium and higher scale are fully operational, while 10 more factories expected to join the industry “in the first phase of the GTP II.”

The winning consultant for the strategy will recommend an “institutional arrangement that can best drive the highly anticipated cotton sector”.

DfID will allocate all the money that will be required at the final awarding of the contract on September 4, 2015, said Ahmed Nuru, director of Policy & Programme Studies, Monitoring & Evaluation at MoI. The closing date for offers from bidders was August 21, 2015 and the final strategy document is expected to be ready by January 2016.

CDD, which could be closed by the recommendation of the strategy yet to be developed, is itself a very young entity, established in 2014 within ministry of agriculture (MoA). It was later re-established as part of the ETIDI.

In 2013/14 Ethiopia produced 35,000tn of cotton on 60,000ha of land. A year later, 60,000tn was produced on 100,000ha, although the increased national demand had varied from 90,000tn to 100,000tn a year.

The expectation for 2015/16 was around 100,000tn, although the rainfall delay and shortage has now cast doubt on the attainment of that target, Bante said. The CDD will send a team this week to make an assessment in the north and south western parts of Ethiopia, based on which it will re-estimate the expected harvest.

In terms of filling gaps in demand and supply the country has been importing cotton; in the last fiscal year only, 45,000qt of cotton was imported by Ethiopian Industrial Inputs Development Enterprise (EIIDE).

The new strategy will make recommendations for increased domestic production that will reduce and eliminate reliance on imports, Ahmed says.

It will set new standards for cotton and is expected to devise a way out to overcome price fluctuation on the global market and its unforeseen impact on Ethiopian cotton growers said Ahmed.

According to the Terms of Reference for the consultants, the winning candidate is expected to assess the experiences of other African countries with genetically modified cotton and opportunities for its production.

During the first Growth and Transformation Plan (GTP I), implemented from 2009/10 to 2014/15, Ethiopia collected 456 million dollars in revenue from the textile industry. That was way below the planned one billion dollar target, as indicated in the GTP I performance report. Problems in quality and quantity of inputs [cotton], as well as gaps in the value chain of input production, were listed as causes of the aforementioned under performance.

MoI is currently receiving bids from international consultants, which will be evaluated by a technical committee from MoA, MoI, the textile institute and the directorate. Technical and financial proposals will be evaluated on the basis of 70pc to 30pc, respectively.