Egypt — The New Frontier?
Part 1: The Past and Present
By Tom Dossenbach
By now, it should be evident to everyone in our industry that we are going through a period of rapid globalization and that furniture and other woodworking manufacturers all over the world are scrambling for their share of the world market. This market exists today in developed countries all over the globe with the United States comprising the largest segment.
In addition, there are new markets surfacing with the emergence of a middle class in developing countries. In fact, according to Ambassador Brady Anderson, Administrator of the U.S. Agency for International Development, a full 40% of American exports go to developing countries. While these countries are currently purchasing products to build their infrastructures, they will be demanding furniture and other wood products for their own consumption during the coming decades. Who will supply these established and emerging markets is a big question that will affect us all.
When we think of furniture exporters today, we think of China, Taiwan, Malaysia, Indonesia and many other countries. Little attention is paid to the Middle East or Egypt in particular. Does Egypt have the ability to become a global player in the furniture manufacturing industry? Could it be the new frontier for furniture manufacturing?
A little over two years ago, I conducted a study of the Furniture Manufacturing Sector in Egypt for the Egyptian Exporters Assn. to assess the opportunities for globalization of that industry. This included the identification of any constraints that would prevent the sector from capitalizing on those opportunities and to formulate a strategy to accelerate globalization efforts. During various assignments in Egypt, I have visited over 60 manufacturers in various woodworking sectors, have met with government officials and industry leaders, and have conducted seminars and workshops for the industry both in Cairo and here in the States.
I thought readers might find a review of this seemingly unlikely candidate for globalization an interesting study. This month I will cover the history and current state of the furniture industry in Egypt. Next month, I will provide a look at the future of the sector, its challenges, and how all of this may play into formulating your company’s globalization strategies.
The Egyptian furniture industry traces its beginning to the earliest recorded history. Early Dynastic antiquities show complicated joinery used in woodworking, such as bed frames dating to 3000 B.C. What must be one of the first elegant ergonomic chairs (the seat) was found in the tomb of Tutankamen and is now on display in the Egyptian Museum in Cairo. There are paintings found in ancient tombs depicting Egyptian workers sanding a wood table top with sand and stones dating to 2500 B.C.
|The future of the Egyptian woodworking industry depends on young people learning the skills of their forefathers as this boy is doing during his summer break from school.|
The industry has developed much over the centuries, during which time there was a strong Roman and then French and English influence in styling. Over the passage of time, several highly developed woodworking skills have evolved and have been incorporated into the manufacture of furniture and millwork for the domestic market. These skills have been handed down from generation to generation — and even today — young children are learning these skills from their fathers and brothers.
It is common to find factories that are the results of the efforts of three or four generations of family furniture craftsmen. However, teenage children of Egyptian furniture manufacturers are looking for new opportunities and — unfortunately — there is an alarming trend of them leaving the heritage of their forefathers for high-tech jobs in Cairo and in other countries. As in North America, there is a perception by young people that furniture manufacturing does not offer a good future for those aspiring to share the wealth of the 21st Century.
Egypt (about the combined size of Arizona, Utah, Colorado and New Mexico) is desert except for the fertile Nile delta which has been irrigated with water from the Nile River and cultivated for centuries for the production of food for the country’s current 68 million citizens. Since there have been no forests in Egypt, furniture and other wood products — with just a few exceptions —- have always been made from imported lumber — from Lebanon thousands of years ago and from Eastern European countries today.
The Present Manufacturing Base
Furniture manufacturing is found in almost all of the industrial centers in Egypt. Cairo, the capital city of 16 million people, is the center of fashion in Egypt and is the furniture design center of the country. Many upscale manufacturers of residential furniture and most office furniture manufacturers and architectural millwork companies are located in and around the capital city.
The furniture capital of Egypt, however, is Damietta, which is located near Port Said at the juncture of the Suez Canal and the Mediterranean Sea. It has over 39,000 registered manufacturing locations with many small family operations at home.
While there are a few new chair and occasional case goods plants in Damietta, most of the manufacturers are very small doing various work for the larger companies. These cottage industries’ specialties include carving, chair frames and upholstering. It is estimated that there are more than 500,000 people in this region dependent on the continued vitality of the furniture industry in Damietta.
In contrast to the small cottage industries is the largest Egyptian furniture manufacturer — Mobica. This is a progressive company with almost 2,000 workers that not only manufactures household and office furniture, but also car seats for BMW and Mercedes in Egypt.
The modern port city of Alexandria also has a great deal of industry including furniture. This is where most of the lumber and other imported materials enter the country and where most exports leave the country. Alexandria has a new industrial city under construction about 40 miles west into the desert and just five miles from the Mediterranean Sea. (A closer look at this city will be included next month). There are two other new industrial cities which have furniture manufacturing facilities: 6th of October City located between Cairo and Alexandria and 10th of Ramadon City located between Cairo and Port Said.
All of the furniture and millwork manufacturing in Egypt is located within the triangle formed by Alexandria, Cairo and Port Said.
The artisan skills, developed over thousands of years, form the foundation of the Egyptian woodworking sector today on which successful export strategies can be built.
The first and most prominent of these skills is carving. As in many other developing countries, there are thousands of skilled carvers in Egypt. However, the strength of the Egyptian carver lies in his ability to copy and reproduce intricate carvings with great skill and consistency. Egyptian carvers are among the best in the world.
It is common practice to rough out the carvings on a multiple-spindle carver and let skilled carvers do the intricate work — thus, utilizing artisans for creating the details only and reducing the labor content. Labor wages in Egypt vary widely but generally range from U.S. $4.35 per day for an apprentice to $15.00 per day for a highly-skilled craftsman — such as a master carver. Most of these carvers are paid by piecework.
Another skill that is highly developed in some companies is the art of creating beautiful marquetry using different veneer species as well as mother of pearl, brass and gold inlays. Much of the furniture for domestic consumption has far too much of this for Western tastes, but is very attractive when done in moderation. The higher-end manufacturers, such as Royal Dream, have skilled workers and produce exquisite furniture.
|This master carver is working on a bed post at Azmi in a new industrial city near Alexandria — New Borg El Arab.|
One of the most interesting arts is that of Mashrabeya (Mash – rah – bea – ya). This ancient skill of joining very small turnings together to form intricate panels has all but disappeared in the Middle East. It was often used as screens in windows and doorways of homes to allow the women to view out while remaining hidden from view from the outside. The conventional shutter has replaced this application. One company — NADIM — still trains workers in the manufacture of Mashrabeya and “interlocking” wood and manufactures exquisite screens, tables, and architectural millwork — such as doors — incorporating these ancient woodworking techniques.
Egypt is known for its French reproductions, but its furniture firms can make anything that can be communicated to them in print — even if it is just a photograph or sketch. This ranges from antiques dating back thousands of years to a sketch from an American designer of a product for the U.S. market. The combination of these assets provides the opportunity for the them to supply the needs of various global markets.
The current assets to support globalization in Egypt are not limited to human skills. Recent years have seen capital investments in new buildings and equipment in the furniture industry as well as companies producing millwork, including doors and windows.
The sector is a study in contrast as mentioned above. There is no better example than that of a family cottage factory compared to the 2 million square feet of manufacturing space at Mobica.
So, wherein lies the export potential for the sector? Do both small and large manufacturers have globalization potential? What must they do to be successful?
We will answer these questions in next month’s installment of this column — Egypt, The New Frontier? Part 2: The Future.
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