Clothing and Textile industry faces global challenges
By Adrian Ephraim
TWENTY years after its founding, the Cape Clothing and Textile Cluster continues to champion a sector that has weathered significant storms – from post-apartheid liberalisation and Chinese competition to COVID-19 disruptions and the recent surge of fast-fashion giants like Shein and Temu.
The industry, employing an estimated 60,000 to 80,000 people and representing around 14% of South Africa’s manufacturing employment, stands at a critical juncture as local manufacturers face mounting competitive pressures.
Shifting from labour costs to productivity
Courtney Grant, Principal Consultant at BMA and Chief Facilitator of both the Cape and KwaZulu-Natal Clothing and Textile Clusters, emphasises that the industry’s narrative around cost competitiveness has evolved significantly. “This is no longer a conversation within the sector of that sort of old and historic mentality of labour’s too expensive,” Grant explains. “We actually don’t have globally expensive labour. What we do have is a productivity issue.”
The productivity challenge, according to Grant, extends beyond individual worker performance to encompass systemic issues. “It’s hard to be productive when load shedding happens and your machines can’t work… It’s hard to be productive when your fabric doesn’t arrive on time because you’ve got port issues,” she notes, highlighting how infrastructure constraints compound the sector’s challenges.
The Master Plan vision
The Retail-Clothing, Textile, Footwear and Leather (R-CTFL) Master Plan, signed in 2019, aims to grow local market share to 65% by 2030. Grant, who serves as programme manager, describes it as “a social compact between retail, national government, labour and manufacturing to grow the local value chain by making it more competitive.”
“We all ultimately want the same thing. We want growth, we want profitable factories, we want to employ people in good compliant jobs,” Grant emphasises.
The emergence of Chinese-owned fast-fashion platforms presents perhaps the sector’s most visible contemporary challenge. Until November 2024, companies like Shein and Temu could sell into South Africa without paying full 45% duties, creating what Grant describes as an uneven playing field.
“I’m deeply concerned about the rise of offshore online retail,” Grant states. “The main concern from industry has been they’re taking significant market share and the playing field isn’t even.” While recent legislative changes have addressed duty avoidance, concerns persist about market access without local sourcing obligations.
Despite challenges, the cluster maintains a strong focus on technological advancement and global best practices. Grant describes extensive learning initiatives, from local factory visits to international trips to Spain’s Inditex headquarters and upcoming visits to China’s largest textile machinery show.
“We call it global best practice exploration. It’s a significant pillar of the work that we do as a cluster,” she explains, noting how automotive industry lean methodologies have been successfully adapted for clothing manufacturing.
While global trends favour sustainable fashion, Grant observes a complex reality in South Africa’s diverse market. The country’s economic disparities create what she terms “two countries in one,” where different consumer segments have vastly different purchasing priorities.
“There is a niche that is going to make sustainability environmental sustainability decisions, but… until a green product is the same price as a non-green product, I don’t know if we’re going to necessarily have people paying more for green,” Grant notes.
Beyond market dynamics, Grant identifies infrastructure as a critical constraint. “Our ports are a significant chokehold in our supply chain,” she explains, emphasising how delayed raw material imports undermine manufacturing efficiency and export potential.
The enabling environment extends to basic services where, Grant notes, the Western Cape’s superior infrastructure creates competitive advantages. “We have a government in the Western Cape who gets the basics right, our roads are good.”
A bold vision for revival
Looking ahead, Grant advocates for fundamental policy reform to incentivise manufacturing investment. Her “magic wand” solution involves restructuring tax policy to reward labour-intensive manufacturing operations that create jobs and add community value.
“Could we not re-look at our tax incentives?” she asks. “If you are investing and running a labour intensive manufacturing operation which creates jobs and adds value… your tax rate should be reduced.”
This approach, Grant argues, could eliminate the need for grants and loans while creating genuine incentives for industrial investment—a critical shift for a sector that currently offers returns equivalent to fixed deposits.
As South Africa’s clothing and textile industry navigates between global pressures and local opportunities, its success will depend not just on individual company competitiveness, but on addressing the systemic challenges that constrain productivity and growth. The cluster’s collaborative approach, combining global learning with local partnership, offers a template for industrial resilience in an increasingly complex global economy.
