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Egypt Plans to Double Cotton Production, Revive ‘White Gold’ Industry

August 30, 2017
Photo credit: Kimberly Varderman/Wikimedia.

Egypt is planning to double the production of its most famous crop, cotton, in an effort to revive a lucrative industry that can re-launch a faltering economy and increase the country’s exports.

Last month, Egyptian Ministry of Agriculture Spokesman Hamed Abdel-Dayem told Reuters that the government aims to increase cotton production to hit 1.4 million qintars (160 kg) in the fiscal year 2017/2018, compared to 700,000 qintars a year ago.

Abdel-Dayem added that the government seeks to push up the price of the long staple cotton to more than 3,000 Egyptian pounds ($US 168.07) per qintar, highlighting that all of the cotton will be exported.

On July 11, Egyptian President Abdel Fattah Al-Sisi also held a meeting with Prime Minister Sherif Ismail as well as the ministers of agriculture and trade and the public enterprise sector in order to discuss ways of boosting the famed industry.

During the meeting, President Al-Sisi directed officials “to set an appropriate price for buying cotton from farmers in order to encourage them to expand their cotton planting in the coming years and meet the needs of the local market”, Presidency Spokesman Ambassador Alaa Youssef said in a statement.

It would appear the plan is already seeing a payoff. Government officials must have been relieved to hear that Egyptian cotton exports will hit 38,000 tons at the close of the 2016/2017 season, up 19 percent on last year’s total, Reuters reported on August 10.

Egyptian cotton is famous for its high quality and distinguished reputation in international markets, as it has unusually long fibers that produce a light durable fabric with a soft touch.

According to data released by the Ministry of Trade and Industry, the textile and spinning industry contributes with up to 26.4 percent of the total industrial production. The sector employs about 25 percent of the local manpower who operate in approximately 7,000 companies with total investments worth EGP 50 billion.

Egypt’s economists say that the government’s action to make use of its unique cotton industry would help it increase its exports at a time when the country is suffering from its worst economic crisis and is seeking to stimulate economic growth.

Ahmed Koura, an economist, said that the government’s plan to increase cotton production is promising and can trigger economic growth. However, he added that the government has to focus first on marketing campaigns for Egyptian cotton products and determine the world markets to which it can export such products.

“The marketing is much more important than the doubling of production because production can be doubled and the government may fail to export the products made of Egyptian cotton. That is why the government has to start with the marketing campaigns,” Koura told BECAUSE.

In cooperation with the European Union, the Egyptian government also launched a national initiative aimed at reviving the cotton industry. According to the initiative, four new cities specialized in textile and spinning will be established and efforts will be intensified to protect and register the Egyptian cotton logo in various world countries.

In February this year, the Cotton Egypt Association inked a deal with India’s Welspun Ltd to market products made of Egyptian cotton worldwide after assessing its supply chains. Under the agreement, the two organizations would work together to create programs for the promotion of the Egyptian cotton logo in the retail markets across the globe.

“The cotton industry has been for a long time an abandoned goose that can lay golden eggs. And I think that it is a high time for the government to make use of this goose,” Ahmed el-Shami, another economist, told BECAUSE. “The revival of the industry will be a large push for Egypt’s economy, will increase exports and accordingly Egypt’s foreign currency reserves,” he added.

The production of Egypt’s cotton as well as its exports have been badly hurt since the January 25 Revolution that led to a security vacuum and looser regulations affecting the quality of the local crop. However, following the floatation of the Egyptian pound in November 2016 and a government crackdown on false cotton, experts and farmers have been saying that they are upbeat about the future of the crop as a devalued pound has encouraged them to increase the areas planted with cotton.

According to data released by the state-run statistics agency CAPMAS, Egypt’s cotton exports edged up by 63.9% during the first quarter of the planting season of 2016/2017.

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