TRALAC - Trade Law Centre

Uganda: Textile Industry Receives Boost

Monday, 13 March 2006

Source: New Vision (Kampala)

Uganda has moved a step ahead in beating the September 2007 expiry of third party fabric sourcing under the AGOA initiative by clinching a deal with an American investor to set up a spinning, weaving and dying mill.

The new $20m (about sh36b) investment is a joint venture between Apparels Tri-Star and ISIS Pacific Capital Inc, a New York-based textile and garment company.

The proposed mill will be set up within the existing Tri-Star premises at Bugolobi in Kampala within six months, James Langford, the Pacific Capital president, said last week.

Pacific Capital has for the past two years been buying garments from Tri-Star.

Langford said the US buyers were happy with Tri-Star's quality garments.

Langford brought with him two new Tri-Star buyers from the US; CINTAS and Williamson Dickies. The duo has confirmed bulk revolving orders starting from June delivery.

Langford who briefed President Yoweri Museveni over the project at State House, Nakasero, said the necessary equipment had been sourced out from the US to utilise the locally produced cotton.

"We will ensure that we are able to use locally produced fabric not only for our own production but also export international quality fabric to the AGOA regional markets.

"Since the machinery is already available, the implementation of the project will only be about six months," Langford said. At present, Uganda's garment sector is highly vulnerable since the upstream textile industry only exists partially.

Uganda has been able to penetrate the highly competitive price and quality conscious American garment market with the benefits of AGOA, a US government's tariff and quota free initiatve.

"We have to take advantage of the locally produced cotton to add value which will result in significant cost savings especially Uganda being a land- locked country and strengthen Uganda's position in the AGOA countries," Langford said.

A State House statement said Museveni assured Langford of high quality cotton produced in Uganda in a meeting attended by the finance minister, Dr. Ezra Suruma, Treasury deputy secretary, Keith Muhakanizi, the trade minister, Daudi Migereko, the senior presidential assistant on AGOA and trade, Susan Muhwezi, the Cotton Development Organisation boss Jolly Sabune and Tri-Star managing director, Veluppillai Kananathan.

Langford has been in the textile and garment industry for more than 25 years.

His company represents many renowned customers in the garment industry of the US.

Muhwezi said,"This is what we have been looking for. We are happy that it is finally happening."

Kananathan said they were happy to partner with one of their leading buyers to facilitate the very much-needed vertical integration.

"Once the project takes off, it will save us a lot of costs incurred in importing fabric," Kananathan said.

He said the development augurs well with the value addition to the local cotton and to prepare Uganda for the expiration of the third country fabric exemption under AGOA by 2007.

Read a related article here.



“ Latest AGOA Trade Data currently available on AGOA.info


Click here to view a sector profile of Uganda’s bilateral trade with the United States, disaggregated by total exports and imports, AGOA exports and GSP exports.


Other regularly updated trade statistics on AGOA.info include: (click each link to view)

  • AGOA-Beneficiary Countries’ AGOA and GSP Trade Aggregates

  • AGOA Trade by Industry Sector

  • Apparel Trade under AGOA’s Wearing Apparel Provisions

  • Latest Apparel Quotas under AGOA

  • Bilateral Trade Data for all AGOA-eligible countries individually.