(Published in MTimes 05 07 2019)
The Export Oriented Enterprises (EOE) consist of enterprises previously operating with an EPZ Certificate as well as enterprises manufacturing goods for exports and holding a registration certificate issued by the ex-Board of Investment.
In 2018, we had 21 less enterprises than in 2015 employing 3,735 fewer workers. All the main economic indicators show a downward trend. This is confirmed for the first quarter of 2019.From March 2018 to March 2019, total employment in EOE decreased by 2,439 (-4.8%) from 51,138 to 48,699. Job losses occurred mainly in enterprises engaged in the manufacture of “Wearing apparel” with a decrease of 2,649 jobs.
Net exports, i.e. exports minus imports, amounted to R 3,887 million in the first quarter of 2019 and its ratio to total exports worked out to 38.1% compared to 40.0% in the corresponding quarter of 2018.
The decrease in industry growth since 2015 ( -3.1%,-5.1%, 0.3 % and -4.5%) can be attributed to declining overseas orders , to labour as well as other costs rising too fast(recall the introduction of the minimum wage in January 2018). Increasing labour costs have, to some extent, undermined the international competitive advantage of the textile industry. Budget 2019-20 does not provide enough of support to the industry that would have paved the way to a clearer vision of where is the industry heading and ensure enough of investment in innovation to re-dynamise the sector.
