China Promises Not To Hurt SA Anymore 2
I wonder if anyone in government is feeling a little bit embarassed that they had to kindly ask China to stop kicking our behind in the textile industry. China has now promised to limit it’s textile exports to South Africa.
To me this is a stop gap measure that probably won’t do much to help our industry. While this agreement limits imports into South Africa it does not help local textile producers who wish to export to other countries and who will have to compete against China in foreign markets. Industry and unions say this provides a chance for SA to upgrade it’s textile factories and provide better training for it’s workers, except that China is probably doing the exact same thing.
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I heard Ebrahim Patel, SACTWU general secretary, being very intelligent on Cape Talk yesterday. He argued that the deal with China isn’t an end in itself, but merely an opportunity allowing South Africa to decide what to do to revitalise the industry.
He pointed out that SA textile industry is never going to be able to compete with China by reducing wages to labour. We shouldn’t try. Rather, the deal represents a opportunity where the competition is reduced over the next three years, after which we have to have a completely different industry, competing not in a value market but rather in a fashion market.
He was saying that the union wants to publish an industry restructuring document along with the China treaty.
Smart and realistic.
To completely makeover an industry is quite risky. Any mistakes and we risk ruining whatever industry is left.
That being said I also don’t see any other option for the textile industry but as I mentioned we better hope we’re way ahead of China on this front (producing for fashion rather than price) or the whole excercise could come to nothing.