Turkish textile group Kipas will construct a $15 mln (12.8 mln euro) dying and ready-made garments plant and local peer Taha Group will set up a casual wear factory in Egypt, it was reported on March 31, 2006.

Taha Group’s plant will be built in Egypt’s Mediterranean city of Alexandria, the company said.

The plant, projected to manufacture brands such as Marks&Spencer, will provide 500 jobs. The facility, scheduled to go operational in a year, will export most of its production to Europe. The move was prompted by the increasing production and labour costs in Turkey’s textile sector.

Kipas has also started preparations for starting the project, the company management board vice-chairman Ahmet Oksuz said. After launching construction works, the company plans to organise a one-year training course for local staff, since the shortage of qualified staff in Egypt is seen as a serious obstacle for the company’s operations.

Apart from lower costs, Egypt attracts Turkish investors also with its Qualifying Industrial Zone (QIZ) protocol with the USA, under which goods manufactured in designated areas in Egypt enter duty-free the U.S. customs territories.

Turkey’s losses from exports resulting from the closing of local factories and taking the production abroad have been estimated at $446 mln (393.3 mln euro) so far.

Bulgaria, Jordan and Uzbekistan are among the other destinations preferred by the Turkish textile sector.