Chad’s textile industry has great potential. The country has a strategic geographical location and a large agricultural base. Chad produces large amounts of cotton, which is the main raw material. Investors can easily base their textile venture in this country. This article examines key opportunities, strategic benefits, and practical guidelines for investing in Chad’s textile sector.

The textile industry in Chad is in its early stages but has potential for development due to its large cotton production. Chad’s agriculture is built around cotton, which employs over 200,000 farmers. Moreover, Chad’s central location in Africa offers access to regional and global markets. This makes Chad as a rising player in textile manufacturing and exports.

The Chadian government has been proactive in creating a favorable business environment. The government’s policy reforms and initiatives are attracting investors. The recent developments within the ZISARH Special Economic Zone aim to boost local and regional production.

Chad’s textile industry heavily relies on cotton, which is a key part of the economy. Over 200,000 farmers depend on cotton farming. Cotontchad, the main company handling cotton, supports these farmers. From 2019 to 2022, cotton production grew from 17,500 metric tons to over 145,000 metric tons. This shows the industry’s growing potential​. 

However, most cotton is exported raw because there are few processing facilities. This means Chad imports nearly 85% of its textile products. This gap is a clear opportunity for investors to build local factories and increase value within the country​.

To tackle this, Chad is developing Special Economic Zones (SEZs), like ZISARH. ZISARH Special Economic Zone is a major growth driver. The large-scale production in this zone is an attractive business environment for textile investors, because of Chad’s vast cotton resources and modern infrastructure. It also allows investors to focus on regional markets in the Economic Community of Central African States (ECCAS).​

The government aims to create a business-friendly environment and support growth in the textile sector.

Chad, however, despite its strong cotton production, is struggling to develop its textile sector. The biggest problem is the lack of local processing facilities. The country exports most of its cotton in its raw form, so there’s little opportunity to create more valuable textile products locally. 

A huge gap is  a dependence on imported finished goods. Chad imports around 85% of its textiles. That’s why there is a big opportunity to bring on local factories to produce garments, fabrics, and home textiles. It slows the growth of a robust domestic market.

Another obstacle is infrastructure. The transport networks are poor and the processing machinery is outdated, making it difficult to run efficiently. To tackle this, the government is developing zones like ZISARH. This zone offers modern infrastructure and business-friendly policies. 

Lastly, there is a lack of skilled workers in the industry. While cotton farming employs many people, technical skills for textile processing are still limited. Setting up training centers and collaborating with experts could help close this gap. 

Addressing these issues can unlock the full potential of Chad’s textile industry.

• Potential for Value Addition

Investors have a golden opportunity to set up modern textile processing units in Chad. Currently, the country has limited facilities for value addition, which results in exporting raw cotton without capturing significant downstream revenue. Developing local supply chains and processing capabilities can unlock considerable potential.

• Finished and Garment Production

The rising middle class and urbanization in Chad are creating an expanding domestic market for garments. Investors can now establish garment manufacturing units with the existing cotton base that produce clothing for both the local and export markets. ZISARH’s strategic position also makes it easy for manufacturers to reach other Central and West African countries.

• Government Incentives

Chad provides various incentives to attract textile investors, such as tax exemptions, simplified customs procedures, and guarantees of investment protection. These policies aim to simplify the business and investment climate and, in particular, foster foreign direct investment in core sectors such as textiles.

• Investor Strategic Advantages

Chad is a strategic asset for investors wishing to gain access to regional markets. It is in the middle of Africa, and its proximity to trade blocs such as ECCAS and the West African Economic and Monetary Union (WAEMU) brings together over 150 million consumers in the region.

This advantage, coupled with improving infrastructure, positions Chad as a gateway to Africa’s growing textile market.

Chad’s textile market is currently valued at around $30 million, with a projected growth rate of 7-9% over the next decade. The increasing disposable income and urbanization trends contribute to rising demand for garments and textile products. This growth opens new avenues for investors to expand their market share and capitalize on this burgeoning demand.

• Conducting Market Research

If you are an investor, you should start with thorough market research to understand the existing consumer preferences and gaps in the market. There is a market for traditional fabrics, but modern garments also have a lot of potentiall. This research will help investors to know which segments are the most viable to target.

• Local Partnerships

The textile industry in Chad requires local partnerships.Investors can collaborate with Cotontchad and other stakeholders to gain valuable insights and access established supply chains. This can also foster better local community integration with mutual benefits. 

• Regulatory Frameworks

Chad’s regulatory environment means investors have to be familiar with import/export procedures, labor laws, and tax policies. However, these government frameworks have been simplified, and protection guarantees have been offered, but your understanding of them is key.

The textile industry in Chad is progressing steadily. Cotton production is on the rise, and government-led initiatives are ongoing. The industry’s growth is supported by an increase in cotton output and sustainable practices under the Better Cotton Program. The inclusion of special economic zones like ZISARH reflects a strategy for the development of local manufacturing capabilities.

Investors have an opportunity to establish textile processing units. Where they can bridge the gap between cotton production and finished textile products. With improved infrastructure, Chad’s textile sector will grow.

Looking ahead, Chad’s textile industry is set to expand. There is a promising future for investors in this emerging market. By capitalizing on these opportunities, investors can play a crucial role in shaping the future of Chad’s textile sector.