TRALAC - Trade Law Centre

Swaziland: Textile industry faces upheaval

Monday, 05 January 2009

Source: Swazi Observer (Swaziland)

The gradual decline of the country’s textile industry has now become a cause for concern even with overseas markets.

The local apparel industry has been marred with a string of challenges lately, some of which resulted in millions of Emalangeni lost out last year alone as a result of constant mass protest action by workers.

The Africa Growth Opportunity Act (AGOA) in a newsletter posted in its website states that investors will have even more to worry about as this is only the tip of an iceberg of challenges faced by the sector in the country.

The newsletter listed a number of challenges facing the local textile industry which also include high utility and transport costs as well as strong and consistent wage demands.

“Despite local textile workers demanding, among other things, increases in wages, the International Monetary Fund says wages in the garment sector are already considered high compared to neighbouring countries, with the exception of South Africa,” the newsletter states.

Further information gathered from the AGOA.info website states that beyond 2012, it is expected that the country will face increased competition from other Asian countries including China, India, Bangladesh and Vietnam, countries known to produce textiles at lower costs than Swaziland.

“Additionally, the rising incidence of HIV and AIDS adversely impacts on productivity. Discussions are ongoing on ways to better position the sector to deal with these mounting challenges.”

The newsletter states that in the face of the mounting pressure on the textile sector, the focus has been on restoring exports, attracting new investments and seeking to promote organic cotton.

“Stringent efforts are currently underway by the Swazi authorities to revitalise what’s left of the ailing textile sector by attempting to attract new investment and increase the local production of organic cotton,” states AGOA, adding that, “there is a belief in Swaziland that organic cotton provides a niche market.

“An ongoing organic cotton project is focused on growing cotton on lands currently unsuited for sugar production.”

Meanwhile, the IMF in a report says government’s plan to cultivate up to 4 000 hectares in the south of the country would satisfy the AGOA requirement for sourcing materials from Africa and would also complete a full vertical integration of that sector.

Further, the Fund says opportunities were provided to the sector when the United States of America government agreed to extend duty-free access under AGOA to 2015 instead of allowing access to expire as previously agreed in September 2007.

“Swaziland can, however, only benefit from sourcing fabric from third countries through 2012. Success in this project would serve to revive a particularly disadvantageous section of Swaziland and contribute much in the fight against rural poverty.”



“ Latest AGOA Trade Data currently available on AGOA.info


Click here to view a sector profile of Swaziland's bilateral trade with the United States, disaggregated by total exports and imports, AGOA exports and GSP exports.


Other regularly updated trade statistics on AGOA.info include: (click each link to view)

  • AGOA-Beneficiary Countries’ AGOA and GSP Trade Aggregates

  • AGOA Trade by Industry Sector

  • Apparel Trade under AGOA’s Wearing Apparel Provisions

  • Latest Apparel Quotas under AGOA

  • Bilateral Trade Data for all AGOA-eligible countries individually.