- Employment - Investment
Ethiopia gets a US $27m Chinese leather factory
China-Africa Overseas Leather Products S.C. and China Africa Development Fund (CADFund) on Wednesday inaugurated a 27 million dollar factory in Ethiopia. The company has expressed its ambition to launch a second phase US $25 million investment project which, if successful, would significantly increase an initial target of 500 local job openings.
China-Africa Overseas Leather Products S.C., under the umbrella of a joint Chinese venture; XinXiang Kudroda and Mingliang Leather Co. Ltd, and China Africa Development Fund (CADFund) on Wednesday inaugurated a US $27 million factory in Ethiopia.
The factory’s construction began in July 2009 on an 80,000 plus square meter land, and took about 16 months to be completed, with XinXiang Kuroda Mingliang Leather Co. Ltd covering 55 percent of the capital and the remaining 45 percent taken by CADFund.
According to He Mingliang, General Manager of the Company, the timing of the inauguration of the China Africa Overseas Leather Products S.C. is pivotal as it comes at a time when the 40th Anniversary of the establishment of diplomatic ties between Ethiopia and China is being marked.
Tackling employment and pollution
And while the Company has the capacity of producing 450 million pieces of processed leather per year and is expected to create some 500 job opportunities for the local people, assurances have been made in the area of environmental safety.
“The Company has introduced advanced international sewerage treatment facilities and technology to guarantee the realization of pollution-free disposal of waste materials,” said the General Manager.
“If the law and policies allow and the condition is favorable, we will launch the second phase, a US $25 million investment with a daily capacity of 2500 cow-skins, and finally to realize our objective of securing 120 million USD from sales,” the manager added.
CADFund supported Chinese projects, says Xin Yiren, Vice President of China Development Bank (CDB), have been making meaningful contribution to economic development of African countries.
“Taking the investments by its Chinese partners into consideration, the total capital amount of these committed projects would be above US $4 billion and are expected to make meaningful contribution to the economic development and improvement of African countries,” he said.
According to China Development Bank President the Fund has also been committed to investing in cement plants and an airport hotel in Ethiopia.
CADFund was announced by Hu Jintao, President of the People’s Republic of China at the Beijing Summit of the Forum on China-Africa Cooperation (FOCAC) in November 2006, with the total capital of US $5 billion (phase-by-phase) to further promote cooperation between China and African countries.
In June 2007 CADFund opened with the first phase capital of US $1 billion solely invested by CDB. The Fund is the first equity fund in China which focuses on promoting more Chinese companies to make direct investment in Africa.
Since its establishment, under the auspices of the Chinese government, the CADFund has invested in over 40 projects in Africa, amounting to about one billion USD.
The China Africa Overseas Leather Products S.C. is the largest leather factory in Ethiopia. It is set to produce, among others, glove leather, shoe-upper leather, garment leather, golf glove leather, and baseball glove leather.