DOMITEXKA – Relaunch of textile production in Kahone
Senegal has a long tradition of industrial textile production. As recently as the 1980s, around 20 companies were active in this sector. But the labour-intensive industry, which once covered all stages of the value chain from cotton cultivation to spinning and sewing, has gradually been pushed aside by imported fabrics. Most of these come from India, Pakistan, or China. In Senegal and other countries in West Africa, clothing manufacturers and tailors can hardly use raw materials from domestic production anymore. Although Senegal is still an important producer of high-quality cotton fibres, almost the entire harvest is exported because there are no longer domestic buyers what could spin the cotton fibre into yarns and fabrics for the textile industry. This has led to a massive loss of jobs over the years.
But interest in local production is growing and customs barriers are gradually being removed. A new, more attractive market environment is emerging. The technical know-how to produce high-quality textiles is still partly available in the country, but to exploit the sector's potential again, new workers need to be trained and introduced to modern production methods.
The Senegalese company DOMITEXKA was founded in 2010 and produces textiles for export. In 2018, the company took over a disused factory in Kahone and plans to restart it with the support of Invest for Jobs. The factory has mills for spinning, weaving, and knitting, as well as machines for textile printing. So far, only the dyeing plant remains in operation. An inspection of the facilities led to the conclusion that a restart of the currently unused production lines is possible if the operating company invests in the modernisation of the facilities.
To operate the factory at full capacity again, the old machines and the hot water boiler must be replaced. The latter will be operated with biomass from local peanut production in the future. In addition, the company's own wastewater treatment plant will be modernised as part of the investment.
The factory will partly use cotton grown in Senegal to produce the yarns. After the conversion of the factory is completed, the fabrics will be marketed in Senegal and other countries in the region. The proximity to the cotton growing areas and to important sales markets brings competitive advantages and will make it easier to react quickly to the demands of the customers.
Our support will enable DOMITEXKA to create 2,100 new full-time jobs at the Kahone site within three years of the completion of the investment phase. All newly hired staff will be trained for their jobs. Among other things, the company has entered a partnership with the Senegalese Ministry of Labour and a local vocational training centre. During the conversion period and the first three years of production, 750 of the newly hired staff members will be trained to operate the more modern machines.
Several companies in the textile sector have declared their intention to buy the fabrics produced by DOMITEXKA and use them for further processing. The future buyers and suppliers have promised to create an additional 2,200 jobs. The entire value chain in the textile sector is expected to benefit from the resumption of production in Kahone – from design to tailoring to trade.
As part of the conversion and modernisation of the factory, DOMITEXKA plans to invest a total amount of 13.59 million euros between 2022 and 2024. The Facility Investing for Employment grants a subsidy of 5.70 million euros (42%). The funds will be used to finance new machines, the hot water boiler, and the wastewater treatment plant.
The Facility Investing for Employment (IFE) of KfW Development Bank is part of the Special Initiative on Training and Job Creation of the German Federal Ministry for Economic Cooperation and Development (BMZ). With its support, the Facility wants to remove barriers that prevent the creation of new and better jobs in the private sector in the African partner countries.
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