H&M Hennes & Mauritz AB, a Swedish multinational retail-clothing company, is considering to produce clothing in Ethiopia.

H&M mainly relies on Bangladesh for clothes production. One supplier says H&M is looking to source one million garments a month from Ethiopia, according to the report of Wall Street Journal.

A spokeswoman said H&M has placed trial orders with Ethiopian suppliers and that large-scale production is expected to begin as early as this fall.

"As a growing global company we have to look at how we guarantee that we have the capacity to deliver products to all our stores where we have a rapid pace of expansion," H&M spokeswoman Camilla Emilsson-Falk said. "We are doing that by increasing production in our existing production areas and also by looking at new ones."

The Ethiopian government has said it wants to revitalize its textile and garment industry, and has set a target of $1 billion in textile exports by 2016.

"Ethiopia not only gives infrastructure support but financial support," said Rajeev Arora, executive director of the African Cotton and Textiles Industries Federation. He cited competitive interest rates, cheap land and labor, and tax breaks from the government as key incentives leading to extraordinary rates of foreign investment over the past five years.

Ethiopia's textile and apparel exports totaled about $99 million for the 12 months ended in June, up 17% from the prior year, according to Fassil Tadesse, president of the Ethiopian Textile and Garment Manufacturers Association.

Source: The Wall Street Journal