- African Growth and Opportunity Act
TRALAC - Trade Law Centre
You are here: Home/News/Article/Swaziland: 1450 jobs to be lost at textile factory

Swaziland: 1450 jobs to be lost at textile factory

Swaziland: 1450 jobs to be lost at textile factory
Workers at the Tex Ray factory
Published date:
Wednesday, 22 October 2014

The Tex Ray factory is set to retrench all its 1 450 workers by November 5, 2014 and close down following the country’s loss of AGOA.

This is contained in a letter of notice that was written by the factory Manager Lisa Chang to the Swaziland Manufacturing and Allied Workers Union (SMAWU) and Labour Commissioner Khabonina Dlamini.

The letter, which is dated October 8, 2014 and titled; ‘Re: Notice of intention to retrench in terms of Section 40 of the Employment Act 1980, read together with clause 11.6 of the recognition and procedural agreement’, was sent to the union yesterday.

The letter said following the removal of the country from beneficiaries of the Africa Growth Opportunity Act (AGOA) with effect from January 2015, the company was unfortunately the bearer of the negative effects from such exclusion.

AGOA offers preferential access to the United States market for goods from about 40 Sub-Saharan nations that meet the required political and economical standards.

The removal of the country as a beneficiary under the Act means that the country will no longer have the preferential access to the markets and this would be effective from January 1, 2015. It is worth mentioning that AGOA contributed in fighting unemployment in the country as over 17 000 people were employed in the textile firms countrywide. 

“We advise that consequent to the country’s exclusion from being a recipient of benefits envisaged in AGOA, with effect from January 2015, the company is unfortunately the bearer of the negative effects from such exclusion.

“The company exports 100 per cent of its products to the United States of America market and due to the country’s exclusion, we have been unable to secure any further orders from our clients,” reads part of the letter, which this publication has in its possession. The letter went on to state that in the absence of any orders this placed the company in a difficult position particularly because it has also been unable to secure alternative customers. It said in light of this, the company has found itself without any other alternative remedy but to implement a retrenchment exercise that would affect all the 1 450 employees.

“It is further unfortunate that all employees, including expatriates, shall be affected. We currently have 1 450 employees engaged on a permanent basis. In light of the fact that Swaziland will stop benefiting from the Act with effect from January 1, 2015, our customers have requested that we make the last shipment on or before November 15, 2014 so that the products can arrive in the USA before the deadline of the beginning of next year,” reads part of the letter.

The company mentioned that it anticipated that the retrenchments would come into effect on or after November 5, 2014.
Tex Ray Administrator Jim Wang confirmed the matter. He said after the country was removed from AGOA, and the company’s headquarters in Taipei failed to persuade the USA to continue buying their products from Swaziland despite the fact that it was removed from the Act, they were left with no choice but to retrench all the workers.

“We are retrenching all the workers but that does not mean the company is leaving the country. The company will be closed for a short while because we will be trying to increase the market in Southern Africa. Maybe at the beginning of next year, we will start hiring the workers again in stages depending on the market,” he said.

The administrator has assured the workers that they would get their terminal benefits to sustain them while the company tries to find an alternative market for its products.

Read related news articles

Time for Eswatini's entrepreneurs to seize AGOA opportunities

The time has come for young emaSwati entrepreneurs to seize opportunities to manufacture basic every day consumer products for export to the US under the African Growth and Opportunity Act (AGOA). The main drive is to get emaSwati to manufacture products locally, sell locally, regionally and internationally using the various initiatives made available by government.  Eswatini’s economy is at a crossroads. While the country boasts a...

13 February 2024

Eswatini exports 26 thousand tons of sugar to the US

About 26 535 tonnes of sugar is shipped yearly to the Unites States of America through the African Growth and Opportunity Act (AGOA). Eswatini Sugar Association (ESA) Logistics Manager, Sibusiso Hlandze said the local sugar was exported  to a terminal in Maputo, Mozambique. He said the terminal,called the Sociedade Terminal De Acucar De Maputo (STAM), played a significant role in the country's sugar industry. It is owned by four sugar...

22 August 2023

Eswatini's AGOA exports at over $8m

The country’s performance in AGOA was highlighted by Tammy Dlamini, who is the Senior Country Representative (Eswatini and Angola) for the USAID Africa Trade and Investment Southern Africa Buy-in Activity.  In his presentation it was noted that the country’s exports to the United States (US) in 2022 was over E1.4 billion, while in 2021 it was E669 164 496 and E387 702 611.40 in 2021. Dlamini said the US was a big market worth...

17 July 2023

Swaziland: Is 2018 the year for its textile workers?

Can the year 2018 be a turning point for textile workers’ prolonged poverty? The workers in the textile industry said as they got into the new year and edged closer to this year’s negotiations which are scheduled to start next Wednesday, they would be demanding that government should adhere to TUCOSWA’s call for a basic minimum wage, which would see them as part of the least paid workforce, getting at least E3 000 per month. This means...

25 January 2018

Swaziland: "We should learn from AGOA loss"

Two years ago, I wrote on this very column how disappointing government was in the handling of the African Growth and Opportunity Act (AGOA) issue.  I remember vividly describing it as a catastrophe so dreadful to be likened to Tsunami proportions. Last week, United States (US) President Donald Trump gave a green light to the restoration of the country’s eligibility for AGOA, which in all honesty is massive relieve for the country and...

31 December 2017

US restores trade benefits to Gambia, Swaziland

U.S. President Donald Trump on Friday restored trade benefits to Gambia and Swaziland under the African Growth and Opportunity Act (AGOA), the U.S. Trade Representative’s Office said. [See text of Proclamation here] The AGOA trade program provides sub-Saharan countries duty-free access to the United States on condition they meet certain statutory eligibility requirements, including eliminating barriers to U.S. trade and investment and...

23 December 2017

Presidential Proclamation to take certain actions under the AGOA and for other purposes

In Proclamation 9223 of December 23, 2014, President Obama determined that the Republic of The Gambia (“The Gambia”) was not making continual progress in meeting the requirements described in section 506A(a)(1) of the Trade Act of 1974, as amended (the “Trade Act”) (19 U.S.C. 2466a(a)), as added by section 111(a) of the African Growth and Opportunity Act (the “AGOA”). Thus, pursuant to section 506A(a)(3) of the Trade Act (19 U.S.C....

23 December 2017

Eligibility reviews: Press statement in support of Swaziland’s eligibility status for AGOA

The Amalgamated Trade Union of Swaziland (ATUSWA) representing 9 000 workers in the textile and apparel industry, the Trade Union Congress of Swaziland (TUCOSWA) representing 40 000 workers and 16 affiliated unions, and the IndustriALL Global Union representing 50 million workers in 140 countries met in Manzini, Swaziland on the 29th of August 2017 to discuss the status of the United States Trade Act – the African Growth and Opportunity Act...

04 September 2017

Swazi king signs public order, terrorism amendment bills

His Majesty King Mswati III has given assent to the Public Order Bill and the Suppression of Terrorism amendment Act. The King endorsed the two Acts last week Tuesday. This comes as good news as this means that Swaziland is a step closer to regaining its African Growth and Opportunity Act (AGOA) status. Swaziland was removed from AGOA in January 2015.  

15 August 2017

US urges Swaziland to review terrorism law as precondition for AGOA readmission

The United States has asked Swaziland to redefine ‘Terrorism Act’ before it could be reconsidered for the African Growth Opportunity Agreement (AGOA). This was stated by Prime Minister Banarbas Dlamini when giving feedback to Senate Portfolio Committee in Parliament during the debate of the Suppression of Terrorism Amendment Bill No. 10 of 2010 on Wednesday. The premier said during the discussion of the bill with the Americans and the...

05 July 2017

Swaziland: 'One month to AGOA review cycle'

Swaziland has one month to work on the remaining AGOA benchmarks as this year’s AGOA review cycle will begin in June until September. AGOA is the African Growth and Opportunity Act, a United States Trade Act enacted on May 18, 2000 as Public Law 106 of the 200th Congress.  The legislation significantly enhances market access to the US for qualifying Sub-Saharan African (SSA) countries. While working on the remaining benchmarks, which...

01 May 2016

You are here: Home/News/Article/Swaziland: 1450 jobs to be lost at textile factory