| Abstract: | Ethiopian textile industry is one of the priority areas through which the country has planned to
achieve its growth and transformation plan. The main purpose of this study is to examine the
performance and challenges of the sector to improve the performance of the sector by using
qualitative research method. The finding shows that there are major problems which require
immediate solution to promote the sector (working capital shortage problem, quality problem,
low labor productivity, poor automation, and high labor turnover) are some of the major
problems of the sector which caused under utilization of the existing potential and as a result the
country could not able to generate sufficient job opportunity and foreign income from the sector.
As per the finding of the study, some recommendations as to improve the quality of the product
which contributes to the competitiveness of the country in the international market , government
involvement in providing market information, the need for man power development, means of
provision of working capital, incentive system to improve labor productivity, importance of
automation to replace the old machineries, and the development of related industries as chemical
industries as dyes, are critical to improve the sector’s performance. |
