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As of 1990, '''manufacturing in Chad''' was dominated by [[agribusiness]], and [[Cotontchad]] in particular.<ref name=":0">{{Cite encyclopedia|last=Coats|first=Peter D.|title=Manufacturing|url=https://www.loc.gov/resource/frdcstdy.chadcountrystudy00coll|encyclopedia=Chad: A Country Study|date=1990|publisher=[[Federal Research Division]], [[Library of Congress]]|editor-last=Collelo|editor-first=Thomas|year=|isbn=0-16-024770-5|edition=2nd|location=Washington, D.C.|pages=|postscript=. {{PD-notice}}}}</ref> Next in importance were the National Sugar Company of Chad (Société Nationale Sucrière du Tchad—SONASUT), the Chadian Textile Company (Société Tchadienne de Textile—STT), the Logone Breweries (Brasseries du Logone—BdL), and the Cigarette Factory of Chad (Manufacture des Cigarettes du Tchad—MCT).<ref name=":0" /> Observers estimated that these five industries generated some 20 percent of GDP.<ref name=":0" /> Of lesser importance were the Farcha Slaughterhouse (Abattoir Frigorifique de Farcha), the Industrial Agricultural Equipment Company (Société Industrielle de Matériel Agricole du Tchad—SIMAT), and Soft Drinks of Chad (Boissons Gazeuses du Tchad—BGT).<ref name=":0" />

Before the warfare of the 1979-82 period, Chad's industrial sector included between 80 and 100 small and medium enterprises, in addition to the major manufacturing industries.<ref name=":0" /> Most of these processed agricultural products, or competed in the import/export trade.<ref name=":0" /> About half were local subsidiaries of foreign-owned firms or were Chadian firms with significant foreign capital.<ref name=":0" /> The foreign-owned distributorships sold agricultural equipment, construction materials, and petroleum products.<ref name=":0" />

==Chadian Civil War==
During the civil war in Chad (1979-1982), the facilities and equipment of many industries were badly damaged.<ref name=":0" /> Most industrial operations either ceased or were reduced greatly, and almost all foreign investors withdrew from the country.<ref name=":0" /> Those operations that did continue on a reduced scale were limited to the [[Soudanian region]], which was not involved directly in large-scale fighting.<ref name=":0" /> By 1983, with the re-establishment of political stability on a national scale, the five major industrial concerns resumed full operations, and the less significant ones, such as SIMAT and the BGT, were rebuilt.<ref name=":0" />

==Post-war==
Since 1983 the return of foreign investment has been slow because of the high costs of rebuilding and a continuing perception of political uncertainty.<ref name=":0" /> Of the approximately twenty enterprises that had reopened by the late 1980s, most were import-export enterprises that lacked a formal relationship with the banking sector.<ref name=":0" /> Most Chadian-owned enterprises had managed to re-establish themselves.<ref name=":0" /> Yet by 1986, small enterprises that had assembled bicycles, motorcycles, and radios remained closed.

The lack of access to credit was another impediment to business expansion in Chad.<ref name=":0" /> Despite the reopening in 1983 of the [[Bank of Central African States]] and of two commercial banks, the International Bank for Africa in Chad (Banque Internationale pour l'Afrique au Tchad—BIAT) and the Chadian Credit and Deposit Bank (Banque Tchadienne de Crédit et de Dépôt—BTCD), the high proportion of available credit going to Chad's major industries limited credit available to smaller enterprises.<ref name=":0" /> Moreover, the banks invoked strict criteria for loan eligibility because of the high risk of lending in Chad.<ref name=":0" /> Few owners of small businesses knew sufficient accounting and technical skills to meet bank information requirements for loans.<ref name=":0" />

==Ownership==
With the exception of the two bottling companies (the BGT and the BdL), which were privately owned, all the other important industries were either [[parastatal]]s with majority government ownership or mixed companies with important government participation.<ref name=":0" /> For the most part, private participation was limited to [[France|French]] investors; investment by private Chadian interests was extremely rare.<ref name=":0" /> French companies were also important shareholders in the larger Chadian companies, such as Cotontchad.<ref name=":0" /> Except for Cotontchad, whose top management was Chadian, all the other major industries were run by expatriate directors, accountants, and mid-level managers who, for the most part, were French.<ref name=":0" />

==Industrial output==
Industrial output grew rapidly in 1983 and 1984, as industries resumed operations that had been interrupted by war.<ref name=":0" /> By 1984 and 1985, prewar levels of output had been either reached or exceeded.<ref name=":0" /> Growth slowed for all industries after 1985, however, because of the dramatic downturn of world cotton prices, and output in 1986 began to decline.<ref name=":0" />

Cotton fiber production by Cotontchad, which directly reflected production of raw cotton, fell sharply in 1985.<ref name=":0" /> This decline was stabilized in 1986-87 by emergency support from international donors.<ref name=":0" /> These donors prescribed retrenchment programs to prevent the total collapse of the cotton industry.<ref name=":0" /> The restrictions imposed on the production of ginned cotton fiber, however, reduced by half the number of ginning mills, with raw cotton production limited to about 100,000 tons.<ref name=":0" /> Production of edible oils by Cotontchad was also affected by the program of cost savings.<ref name=":0" />

Other industries were affected directly by the fall of cotton prices.<ref name=":0" /> STT textile production slowed, as did the production of agricultural equipment by SIMAT, which made plowing equipment for use in cotton planting.<ref name=":0" /> Furthermore, the drop in revenues to farmers in the soudanian zone for their cotton and peanut production affected their ability to buy equipment.<ref name=":0" /> Lost revenues to farmers, along with the reduction in the numbers of workers needed in ginning operations, took a toll on cash earnings and therefore on buying power.<ref name=":0" /> By 1986 the ripple effect of these lost revenues in the cotton sector was widespread.<ref name=":0" /> The downturn in production in all industries left Chad with considerable unused capacity, ranging from 15 to 50 percent.<ref name=":0" />

==Impediments to industry==
A number of other factors resulted in the slump in Chadian industry.<ref name=":0" /> Commercial sale of goods was low in a largely cash poor or nonmonetary economy.<ref name=":0" /> The decline in the cotton sector, which had provided the largest infusion of cash into the economy, further reduced consumer demand.<ref name=":0" /> Another impediment to industry was the high local cost of production compared with the cost of production in neighboring countries.<ref name=":0" /> Factors that raised local production costs included high transportation costs, overdependence on imports, and restricted economies of scale for small operations.<ref name=":0" /> Imported inputs were equivalent to about 30 percent of industrial turnover for Cotontchad, the BdL, and the STT and to about 60 percent for the MCT.<ref name=":0" /> Local substitutes for inputs were often more expensive than imported equivalents.<ref name=":0" /> Imports were often marketed to subsidize local production by a given industry.<ref name=":0" /> An example was SONASUT's importing refined sugar at less than local production costs, selling it locally, and using the proceeds to subsidize sugarcane production on SONASUT plantations.<ref name=":0" /> Interlocking relationships of production among companies also kept production costs high.<ref name=":0" /> For example, the BGT used SONASUT's refined sugar in its production of soft drinks, according to a convention with the government to use local inputs, even though imported refined sugar was cheaper.<ref name=":0" />

==References==
{{reflist}}

{{Economy of Chad}}

{{DEFAULTSORT:Manufacturing In Chad}}
[[Category:Manufacturing by country|Chad]]
[[Category:Economy of Chad]]

Manufacturing in Chad - Revision history

imported>LucasBrown at 03:25, 15 July 2024