Africa-Press – Eswatini. The observed trend in the closure of textile firms in the country is alarming.
This is an issue that requires expedient action from the government, working together with the private sector. The country cannot afford further increases in the unemployment rate. The textile sector is the third biggest employer of labour in the country, after government and the agricultural sector. This is an alarming trend that one needs to weigh on and plead for expedient government action.
A case for the sector
Recent statistics show that there are approximately 20 textile firms in the kingdom, focusing on either cut make and trim or fully factored. The sector employed 19 000 emaSwati as at 2019, composed of 80 per cent women and 20 per cent men. The spread in the employment shows the gendered facets of the sector. Saving the sector is tantamount to saving jobs for women, indifference on the issue is a direct disregard of the gender equality and equity. Furthermore, the sector has massive potential for employment creation.
Remedial measures
There is need to assist the sector reach its full potential, as there is still some room for improvements. The sector still needs to support employment creation in the country and the government working together with private sector, through concerted efforts, must save the sector. The cost structure of the industry can be improved through some assistance subsidies. Most of the structures housing the firms are owned by government; hence the government can indulge the industry with some rental concessions. Also, the government can take leaf from Lesotho and offer some tax concessions to the industry to ensure that the industry stays afloat and continues to provide jobs for the population.
Structural reforms
The sector also requires some internal reforms to ensure that the industry stays competitive domestically and internationally. The model of cottage factories can also be adopted and decentralise the production process. This sector has the potential to become a conduit for women empowerment. Cottage factories and a decentralised execution would place economic power in the hands of households and women. The sector has the potential to support the apparel industry that is most run by women, consider home sewing. The impetus is on the industry to find ways of staying cost-effective and cost-efficient.
Diversification
The industry needs to diversify beyond the South African market and the US market. The preferential treatment within AGOA is a good starting point, however, as a country we need to ensure that we build sustainable jobs beyond preferential access to markets. There is need to restructure our foreign direct investment (FDI) package as a country to ensure that we attract sustainable industries and firms. We also need to include emaSwati in the production process. The country must ensure that our SMEs also come into the fray; domestic companies tend to thrive to want more home grown growth.
The country must ensure that FDI is able to transfer skills to the domestic producers. The industry has had its days of success and the success has been extracted to other countries and locals have not gathered much of the benefits. The industry needs to diversify into other sectors, such as retail and supplying into regional and domestic markets in the region. We need to improve the fashion and design landscape in the country; this is one of the industries that we are neglecting in the country. The creative arts are not fully supported in the country and we need to change that, there is an entire industry to be built in the country. Regarding the issue of cost effectiveness, one cannot end the thought without looking at the minimum wage issue.
The minimum wage
A thorny issue that the country grapples with is that of a minimum wage within the textiles sector. One might argue that the industry is not worth saving since the wages paid in this sector are relatively low. The textiles sector is a labour intensive industry, as such a rapid increase in costs may result in more layoffs within the sector. Given the current economic climate, the country cannot afford any further increases in the unemployment rate. There is need to empower the women and men working within the sector to take charge of the production and be able to own their own cottage firms. As a country it is important that we start thinking about value chains and not supply chains. It is important to ensure that we build value for emaSwati, not only as participants providing labour but also as businesspeople and entrepreneurs.
Sources of growth
The country needs to sustain sources of growth and uncover new sources of growth. The textiles sector presents both a case that needs to be sustained in a bid to protect jobs and continue growing the economy. Through metamorphosis the sector can be a new source of growth, through diversification and through unlocking the value chain. It is incumbent on the government and the private sector to work together in saving the sector and have it unlock new lines of growth. Sustainability of sources of growth is critical and we need to ensure that locals take charge.
Source: times
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