On the sidelines of the ongoing 27th United Nations Climate Change Conference (COP 27) in Sharm el Sheikh, the International Islamic Trade Finance Corporation (ITFC) (http://www.ITFC-idb.org), a member of the Islamic Development Bank Group (IsDB), organized a joint session with United Nations Industrial Development Organization (UNIDO) Egypt titled ‘Egyptian and Sub-Saharan Africa Cotton Traceability for Resilience and Sustainability.

This session highlighted the strategies for boosting the ability of value stream participants to fully realize the potential of the climate-resilient textile and cotton sector in Egypt and Sub-Saharan Africa while increasing competitiveness and integration in regional and global value chains.

Egyptian cotton is mostly renowned for its outstanding physical fiber qualities, exceptional aesthetic performance, and unmatched durability.  However, in the Egyptian cotton-textile value chain, cotton is both a contributor and a victim of climate change. In response to these challenges, the UNIDO multistakeholder project, "The Egyptian Cotton Project," supported by ITFC, began supporting Egyptian farmers in June 2020 to execute a methodical strategy for sustainable cotton growing as advocated by The Better Cotton Initiative.

On the regional level, evidence shows that the main issue of the African cotton and textile industry remains the low level of local processing of the fibre and the valuation of by-products.  Despite some issues in the cotton and textile sector, the African Continental Free Trade Area (AfCFTA) which came into force on January 1st, 2021, offers a large market of more than 1.3 billion consumers, as well as several business opportunities. This large market should further stimulate industrialization and investment opportunities in the cotton value chain.

Moderated by Ramamurthi Krishnan, Advisor, Abc Oqqo’gr Agro Cluster Limited Group of Companies, the Panel Discussion was joined by Aymen Kasem, Division Manager, Trade Development, ITFC, Dalia Tadros, Director of Operations, Industrial Development Group 

Representing Ministry of Public Sector (Ex- Assistant Minister of Public Business Sector of Egypt), Sara Berlese, Program Officer, UNIDO Regional Office in Egypt; and Babajide Sodipo, Senior Manager, AU/AfCFTA Relations at Afreximbank.   

With unique areas of expertise, the panelists discussed the policies, practices, and processes that can push pledges into action to enhance the traceability and transparency of the Sub-Saharan African and Egyptian cotton-textile value chain.  These pledges will allow for a just transition towards a low-carbon, resource-efficient, and more circular economy.   

During his keynote speech, Eng. Hani Salem Sonbol reiterated- “The African cotton sector has been a key focus of ITFC, particularly in all major producing countries, including Benin, Burkina Faso, Cameroon, Côte d'Ivoire, and Mali with US$ 1.4 billion in financing the cotton sector. Since its inception, ITFC has provided approximately US$7 billion in financing to the food and agriculture sectors. Farmers are one concrete example of how our impact manifests. ITFC also collaborates with UNIDO through the Better Cotton Initiative because of our long-standing involvement in the African cotton sector. Together, we assist brands and retailers in achieving more consistent quality and sourcing their products from Egyptian cotton producers who adhere to national and regulatory agricultural practices.”

Krishnan Ramamurthi, the moderator of the session stated that “without sound traceability, measuring progress to ESG Goals and commitments is limited. Furthermore, commodity supply and value chain traceability is a two-step process, wherein both digital chains of custody and cutting-edge “fingerprinting” of the origin for verification are required components.”

Aymen Kasem, Division Manager, Trade Development of ITFC added that “Traceability provides the ways and means to overcome non-tariff-related barriers, thereby enhancing trade. ITFC supports aggrotech solutions that enable sustainable farming – especially in the least developed countries.”

Sara Berlese, Program Officer, UNIDO Regional Office in Egypt said, “Traceability is a powerful enabler for more sustainable, transparent, and inclusive cotton-textile value chains in Africa. UNIDO is keen to further support multistakeholder initiatives, focusing on skills development and innovative digital solutions to foster new opportunities for the African cotton textile industry.”

Dalia Tadros, Director of Operations, Industrial Development Group, Representing the Ministry of Public Sector commented, “The Egyptian Cotton Reform Project covers the entire supply chain from farming to complete processing; aims at availing traceable and sustainable inputs for private finished goods producers; thus, creating sustainable value added for the crop that supports the livelihoods of many families and women across the African Continent.”

In his remarks, Babajide Sodipo, Senior Manager, AU/AfCFTA Relations at Afreximbank, commented on how women in the producing nations dominate the African cotton business. He noted that the cotton industry is the source of livelihood and survival of some of the most vulnerable people in society.

UNIDO and ITFC are committed to continuing to support practical and scalable solutions to improve the performance and competitiveness of the Egyptian cotton-textile value chain—one of the country's most iconic industrial productions—while preserving its environmental and social sustainability and inclusivity for future generations.