Revival of the clothing and textile sector

Speech by Alderman James Vos, Mayoral Committee for Economic Opportunities and Asset Management

Good afternoon ladies and gentlemen.

It is truly an honour for me to be in the company of individuals who contribute to the creative economies of Cape Town.

As a City, we are continuously looking to invest and support sectors that stimulate demand and make business sense.

My portfolio that includes Economic Opportunities, has the potential to ensure that we continue to be the go-to city on the African continent and globally for business and trade in this important sector.

I am excited to confirm that our commitment to revive the clothing sector in Cape Town ranks high on my list of priorities.

Why the clothing sector?
The clothing and textiles industry continues to be a significant employer in the Cape Town economy, employing over 23 600 individuals, which makes this the second largest employer within the manufacturing sector.

The clothing and textiles industry is also a significant contributor to Cape Town’s exports with clothing and textile products totalling R4,4 billion in 2017.

Given the challenging economic climate, this is a figure we should all be proud of.

What does the future hold for the sector?
I would like to reassure you that we are committed to growing this industry. My department will provide resources to assist with stimulating this sector.

You may wonder how we intend to do this?

Firstly, by hosting regular sessions with key role players in the industry to collaborate on growth opportunities, while at the same time identifying blockages with industries to find ways to resolve it.

In addition, my department also provides funding to the following Special Purpose Vehicles within this sector:

• Cape Town Fashion Council
• Western Cape Clothing and Textile Service Centre (CLOTEX)
• Craft and Design Institute (CDI)
• Cape Clothing and Textile Cluster

Funding is used to for programmes that include training, upskilling and cross-skilling, internship training and placement, product development, business development, sector coordination and promotion, value chain linkages and alignment, and performance benchmarking programmes.

Kudos to the CCTC
The City is committed to the CCTC’s clustering approach, which favours shared learnings and shared resources to help drive growth and increased competitiveness for firms in the Clothing and Textile sector.

The proof of this approach is well supported by CCTC’s 2018 Annual Report that summarises performance improvements.

We are pleased to report a 34% sales growth above inflation and 35% growth in employment for CCTC member firms over the last four years.

These results are even more impressive when compared to the overall Clothing and Textile industry in South Africa which has been stagnant at best since about 2012.

In addition to the CCTC’ efforts and our focus on SPVs, I am eager to announce that next year the City will commission research to measure and analyse the economic contribution of Cape Town’s Clothing and Textile sector.

The study will map the sector’s value chain and identify potential opportunities and inherent constraints for the local industry.

The research will be used to direct future City initiatives within the sector. In doing this, we can then make informed decisions about this sector.  This will also allow us to look at market trends and be in the position to anticipate changes in the market and have an adequate proactive response.

There is not much to fix, we just need to collaborate and use our combined expertise.
The City’s financial support for the clothing and textile industry has bagged a number of successes during the last financial year.
Just over 150 SMME’s were offered assistance with over 300 students receiving training and assisted with employment.
Gearing up for the future
The industry is currently experiencing an emerging global trend known as “fast fashion” that favours the speed at which goods can be brought to market and this is preferred over cheap goods.

This trend coupled with the rise of the ethically-minded consumer has created new opportunities in the clothing and textiles industry in South Africa. Cape Town, with its strong retailer presence, is perhaps the best placed domestic city to adapt to these trends and to lead the revival of this important industry.

The importance of this industry is key in two other aspects, namely, its impact on employment and exports. It is also the most labour-intensive sector outside of tourism and the primary sector, meaning that the job return on investment tends to be higher than in other sectors.

The industry is currently exploring a number of opportunities such as the bringing back apparel sourcing locally, away from China that will create opportunities for the domestic industry to reclaim its prominence. The growing value of quick response in the context of “fast fashion” is leading retailers to favour sourcing options form local suppliers.

The opportunity also exists to build better relationships between local manufacturers, big retailers and designers.

In closing, last year the City of Cape Town allocated funding towards the Cluster Firm Performance Benchmarking Program.

Based on Cape Clothing and Textile Cluster’s excellent performance, it gives me pleasure to announce our intention to allocate increased funding in the new financial year.

I look forward to working closely with all stakeholders in this cluster to revive this once bustling industry.

Published by:
City of Cape Town, Media Office