MADE IN MADAGASCAR

Creating jobs through AGOA exports and helping U.S. businesses source the products their customers demand

East Africa Trade and Investment Hub

By EAST AFRICA TRADE AND INVESTMENT HUB

Located in the Indian Ocean, off the East coast of Africa, the island nation of Madagascar is home to 24 million people. Seventy-six percent live in extreme poverty[1] and struggle to meet their basic needs.

Colorful houses cling to the narrow roads that meander through the hilly capital city of Antananarivo. Paddy fields occupy the flat land. Signs of poverty are everywhere.

THE APPAREL INDUSTRY PROVIDES JOBS

Madagascar’s textile and apparel industry is the largest formal employer outside of agriculture. It has the capacity to create hundreds of thousands of new jobs if the industry can regain U.S. buyer confidence and take advantage of duty-free exports to the U.S. through the African Growth and Opportunity Act (AGOA).

The USAID East Africa Trade and Investment Hub helps Madagascar-based apparel companies to improve their efficiency and institutionalize the best practices and standards that American apparel companies require. The end result is formal employment for Malagasy workers and quality product for U.S. businesses.

U.S. BUYERS NEED RELIABLE SOURCING OPTIONS

“Large U.S. buyers want to source from East Africa, through AGOA; they need reliable high-quality factories to do so,” said Sam Meeks, a lean manufacturing specialist and USAID Hub technical advisor.

Why would U.S. buyers want to source from Madagascar? Watch our video.

CAPITALIZING ON AGOA – A COMPANY SNAPSHOT

In February 2016, Eugene Havemann started a knitwear factory 4km from the international airport outside of the capital city of Antananarivo. His plan: capitalize on Madagascar’s strong history of apparel production and connect to the high-volume U.S. market, using AGOA to improve his competitiveness.

Eugene Havermann displays his products at a trade show in Antananarivo. The USAID Hub paid for his booth. Havermann initially called his company Madagascar Clothing Manufactures. He later changed the name to Madagascar Garments.

Eugene Havermann displays his products at a trade show in Antananarivo. The USAID Hub paid for his booth. Havermann initially called his company Madagascar Clothing Manufactures. He later changed the name to Madagascar Garments.

With private sector drive and some help from USAID, after just two years of operation, Havermann grew Madagascar Garment to a Worldwide Responsible Accredited Production certified, 14-line production company that employs nearly 700 people. USAID-supported linkages led to $1 million in apparel orders for 2018 and Havermann estimates that USAID-supported orders will be six times that in 2019.

“Without the help of the USAID Hub Madagascar Garments would NEVER have got to where we are right now. At present we employ nearly 700 people, and if we continue on our current path we could easily double that,” said Havermann.

A MATURING COMPANY

USAID Hub advisor Sam Meeks concurs.

“The factory overall efficiency was 28% before my arrival and 41% the last 2 weeks. That is a 31% overall improvement and we are really just scratching the surface.”

INSTITUTING HIGH STANDARDS

“The factory is clean, far more organized and working on maintaining and improving on it. It’s also ready for future compliance audits.” “I would think another 30% improvement is possible,” said Mr. Meeks.

U.S. demand and Madagascar Garments improvement in efficiency and compliance is driving Havermann’s estimate of $6 million apparel exports in 2019.

With the help of USAID, Havermann is ensuring that Madagascar Garments meets the needs of U.S. buyers. The resulting exports drives job creation in Madagascar.

Meet Marie-Eliane Rasovalolana, an apparel worker who can educate her children, pay the rent, and feed her family because of her job.

Below is her story

DRIVING INCLUSIVE, SUSTAINABLE GROWTH

The textile and apparel industry drives economic growth. In the short term, it provides income and jobs, especially for women. In the long term, it provides countries the opportunity for sustained development and investment.

Malagasy school children pass in front of World Knits apparel company, one of the many export-oriented factories creating jobs in Madagascar

Malagasy school children pass in front of World Knits apparel company, one of the many export-oriented factories creating jobs in Madagascar

The goal of USAID programming is to drive inclusive, sustainable economic growth to help end extreme poverty. In Madagascar, that growth is resulting from an expanding apparel industry that is capitalizing on AGOA to reach the high-volume U.S. market.