Times Of Swaziland: TEXTILE SECTOR POTENTIAL NOT FULLY REACHED

TEXTILE SECTOR POTENTIAL NOT FULLY REACHED
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Nhlanganiso Mkhonta on 20/02/2024 08:22:00


MBABANE - A sector whose potential has not been fully reached in Eswatini is the
textile sector.
The textile sector is importing more than 50 per cent of the raw and
semi-finished materials used in the production processes.  So, strengthening
local value chains and increasing production may enable Eswatini to benefit to a
greater extent from the textile sector, with a positive impact in terms of
employment and value- added. Under the second objective, which is boosting value
addition in resource-based sectors to ensure inclusive industrialisation,
Eswatini’s manufacturing sector is characterised by low value-added production
with limited backward and forward linkages. Statistical evidence shows that the
country exports mostly raw and semi-finished products with little or no value
addition. On average, in 10 value chains, the share of raw materials and
semi-finished products in total exports represented more than 55 per cent in
2020.
The most important trading sectors for Eswatini are export products with low
value addition in terms of the level of transformation (wood, leather, metal,
chemicals, mineral, fish, sugar, spices and cereals, oilseeds and fats,
beverages and spirits).    Therefore, boosting value addition in the country’s
resource-based sectors can significantly enhance inclusive industrialisation
through improved wages locally. The third objective which is enhancing economic
resilience by diversifying production and export markets comes after it has been
noted that Eswatini currently faces the challenge of producing a limited number
of products in the manufacturing sector. For instance, the top three products in
2021 contributed over 56 per cent, as a percentage of total manufactured
exports. These top three products each contribute 32, 14 and 10 per cent,
respectively.
The other products that follow these top three contribute less than 9 per cent
in total manufactures, which is negligible and problematic.  This poses a risk
for the Eswatini economy as it remains vulnerable to shocks, thus the need to
pursue a product diversification strategy to enhance economic resilience in the
country. Impediments to achieve this objective include conflicting policies
within government, lack of Research and Development (R&D), poor market
intelligence, weak regulations, and insufficient information on trade
agreements.