As one of the most economically developed countries in Africa, South Africa’s textile and garment industry is one of its very important industrial sectors. The textile industry chain is relatively complete and the industrial foundation is relatively good. Currently, South Africa is the world’s largest producer and supplier of mohair, accounting for about 54% of the world’s output. In addition, South Africa is also a major producer of man-made fibers such as nylon and polyester fibers.
Due to its extensive industrial base and fruitful economic development speed, as well as its outstanding advantages in geographical location, economic environment, trade policy and other aspects, South Africa is considered one of the most promising emerging markets in the world and has become an important country in our country. trading and investment partners. As the second largest economy in Africa, South Africa has complete hardware infrastructure and stock trading markets, and has diversified consumer needs. Africa, which has a middle class of one-sixth of its nearly 1.3 billion people, is seen as the next huge growth point after China and India, and traders can also access other markets in sub-Saharan Africa through South Africa.
South Africa Textile Industry Overview
At present, South Africa’s domestic textile and apparel production capacity is insufficient, and about 56% of textiles and apparel are purchased from major international markets. Although South Africa is rich in domestic wool raw material resources, its deep processing capacity is insufficient. The fabric processing, printing, dyeing and finishing links are relatively weak. The development of the knitting and technical textiles industry is also relatively slow. There is a lack of capacity cooperation with my country’s textile industry in related subdivisions. Huge industrial complementarity.
This textile complementarity and opportunity has allowed China-Africa textile trade to grow in recent years. The main export markets for South Africa’s textiles and clothing are China, Africa and countries in the European Union. According to South African customs statistics, in 2021, my country will be South Africa’s largest export market for textiles and clothing, with textile exports worth approximately R3.853 billion. From the perspective of export product categories, wool textiles are the most important export products of the South African textile industry. In 2021, South Africa imported approximately R23.743 billion in textiles from my country, and approximately R11.712 billion in toys and sportswear.
Multiple unfavorable factors affect the development of South Africa’s textile industry
The COVID-19 pandemic has had a significant negative impact on South Africa’s economy and trade. In its recent Global Economic Outlook report, the International Monetary Fund (IMF) predicts that the South African economy will grow by 1.9% and 1.4% in 2022 and 2023 respectively, with average inflation rates of 5.7% and 4.6% respectively. However, the international credit rating agency Moody’s predicted in a report in early May that South Africa’s inflation rate would rise to 8% this year due to the impact of the Russia-Ukraine conflict and rising U.S. interest rates.
Recently, South Africa is entering the peak of the fifth wave of the COVID-19 epidemic. Coupled with the frequent occurrence of extreme weather and climate disasters, its business and investment environment has also deteriorated, which has dealt a serious blow to South Africa’s economic recovery. In addition, the current social security situation in South Africa is not yet stable, labor relations remain tense, and strikes occur frequently, posing greater challenges to companies investing in South Africa. At the same time, labor wages and water and electricity prices in South Africa are rising year by year, which directly affects the cost competitiveness of South Africa’s manufacturing industry.
Faced with the current development pressure of the textile and apparel industry, the latest industrial development plan released by the South African Department of Trade and Industry stated that it will increase the domestic market cycle, enhance the demand and supply capacity of the domestic market, and recommends that the proportion of domestic procurement of textiles and apparel be increased. Increase from 44% to 65%, while reducing the proportion of overseas procurement to 35%. In the future, Chinese textile and apparel products will face a more intense competitive environment when entering the South African market.
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