South African clothing retailers reduce reliance on Chinese imports

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The South African flag is increasingly adorning the clothing labels of major retail chains across the country. It is an effort to strengthen the country’s garment and textile sector.

More than half of the textiles sold by South African retailers are imported from abroad, according to the government, and nearly 60% of those imports come from China.

Retailers who sign a government blueprint to support local businesses say there are more benefits than just job creation.

Hazel Pillay, Managing Director of retailer Pick n Pay Clothing, said: “Being able to have the product made locally means you can actually respond more effectively to customer needs, which is really what every retailer wants – moving towards faster response .”

Pick n Pay Clothing is among retailers such as Woolworth’s, Mr. Price and Truworth’s that are increasing their local product sourcing from 28% in 2019 to 40% today. The change is now gaining momentum in the wake of global trade disruptions due to the coronavirus pandemic, as well as record unemployment.

Katekani Moreku, a young designer recruited to help with the effort,” said, “It got me a lot of attention and gave me a lot of publicity. In the times we live in, where the unemployment rate is very high, I think it will have a very important impact that will create more jobs for all generations.

Moreku estimates that his collaboration with Pick n Pay in 2020 created around 1,000 jobs, from manufacturing to digital marketing.

This is what the South African government wants, with a target of 121,000 new jobs in textiles by 2030.

More investment needed

But retailers, including Pick n Pay’s Pillay, say it will require investment in skills training and support for entrepreneurs.

“Before the 2000s, yes, skills were readily available,” Pillay said. “And like [production] moved to China, investment in skills development, investment in machinery all disappeared. But I think if we look at where the local business is in 10 years, we’re definitely going to see a revival of some of these types of locally made products.

This growth is necessary as the retailer aims for 60% of all textile products to be sourced locally within the next five years.

But economists warn that setting quotas and targets alone will not be enough to rebuild the industry.

Dawie Roodt, chief economist at financial services firm Efficient Group,” said, “What you need to do if you want to get more investment in textiles and more localization in textiles, or any industry by the way is for the government to become a lot like, for example, making sure the infrastructure is working properly, making sure it’s safe to invest in South Africa and things like that.

Regular power cuts and decaying railways prevent local manufacturers from producing and transporting goods.

And there are other practical obstacles to reducing the $3 billion trade imbalance between China and South Africa.

“Keep in mind they have economies of scale,” Roodt said. “South Africa compared to China is a relatively small country, so I don’t think it will be possible for us to really compete in a big way.

But for budding designers, even a little boost in local industry gives hope for future success.

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