By Tapiwanashe W Mangwiro.
Harare, Zimbabwe. (News of The South) – The period between 2013-2019 has been difficult for the textile and clothing sectors. This sector saw a number of companies closing, a number of people employed by this sector losing their jobs and the sector itself almost going extinct in 2017 before government intervention through ZAMCO.
The clothing sector in Zimbabwe comprises of registered companies who are members of the Zimbabwe Clothing Council. Zimbabweans own the majority of the companies and there has been an influx of indigenous clothing manufacturers over the past few years. However, only a small number less than 8% manufacture for export despite the growing regional market and inroads in past years into new markets mainly in Europe.
The Zimbabwe clothing worker is highly skilled and able to produce clothing to world standard requirements and importantly at competitive prices. Other areas for investment would be direct investment of management and technical skills or the establishment of joint venture manufacturing and marketing operations. The textile industry has gone through a down period and requires investment in new technology which will enable it to compete with imports into the Southern African region from the Far East.
There are opportunities for investment on a joint venture basis into textile design which will enable the industry to attract customers from a wider market base. Within the industry there is under-utilized capacity, which could be developed with external partners into more, specialised manufacture through an improved marketing strategy.
Moreover, South Africa is losing ground, owing to its growing production costs, which opens an immense prospect for Zimbabwe to seize more market share.
The biggest strength that Zimbabwe has over its competitors is its cheap and vast workforce. The sector minimum wage in Zimbabwe of Z$1 300 is lower than the ZAR2 600 of South Africa. At the official rate of Z$1:ZAR0.8693 a worker in Zimbabwe is earning ZAR1 130.09 which is less ZAR1 469.91 less than their South African counterpart.
Also, there are numerous vocational and polytechnic colleges producing textile graduates in the country every year, further adding to the skilled manpower for the segment. Moreover, favourable government policies, bank facilities for raw material purchase, and if any investment, must be churned out towards strengthening backward linkage supporting industries to create an even more strong case for the sector.
Zimbabwe uses 30 percent of locally grown cotton and 70 percent is exported to textile industries dotted around the world, hence failing to exploit competitive advantage in cotton value chain considering the country’s ability to grow the essential raw material locally.
Being mindful of the fact that some countries like Kenya have a thriving textile industry from cotton imports, Zimbabwe is losing out on 100 percent gains associated with growing and value adding cotton locally. With Zimbabwe wanting to be an upper-middle income country by 2030, they need to adopt and develop the textile industry.
Speaking of uplifting the livelihoods of citizens through textile and garment industry, Bangladesh knows more on this as they have been excelling well and will be an upper-middle economy by 2021.
In 2006 Bangladesh was ranked 6th on the list of top apparel exporting countries with a market share of 2.8% only but in 2019 they were the 2nd only behind China and a market share of 24%.
In 2015 Chairman of Zimbabwe Clothing Manufacturers’ Association (ZCMA), Jeremy Youmans, said that the industry needed about US$5 million for recapitalisation and that was enough to double capacity utilisation of 45% at the time. Their hope was that they would double employment by 2020, but seems like they have regressed even further.
With the association saying that most machinery is up to date, this gives the South Africa the opportunity to produce clothes at a cheaper cost and sell them at even lower prices than the current prevailing prices.
Instead of them continuing to buy from the Far East they will be able to export and gain more revenue. The country is missing out on the Duty-free advantage that countries like Bangladesh enjoy.
Since they have the Least Developed Country (LDC) status that qualifies them for duty-free market access or reduced tariff facilities to many developed and developing nations, globally. Bangladesh enjoys duty-free access to around 52 countries, including countries in the EU, the USA, Australia, Switzerland, Japan, Turkey, Russia, Norway, New Zealand, China, South Korea, Thailand, Malaysia, and India, for the trade of many products.
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