South Africa has spent three decades debating whether it can still be an industrial manufacturing country. The share of manufacturing in GDP has fallen from roughly 22% in the mid-1990s to about 13% today. Each attempt to reverse the decline runs into the same questions.
It is not whether the country has the capital, the skills or the industrial base but whether the state can hold a consistent line under its own policy. Clothing manufacturing is the clearest available case study, and what it demonstrates holds true across the rest of the sectors of industry.
Clothing has been written off repeatedly. The Multifibre Arrangement, which had governed global textile trade since the 1970s, was phased out in 2005 and exposed domestic producers to direct competition from low-cost Asian exporters. The conventional view was that South Africa could no longer produce clothing competitively.
The past five years say otherwise. For example, at The Foschini Group’s Prestige Clothing facility in Caledon, a R75m investment has compressed garment assembly times from about 15 days to about four days. That is globally competitive on any retailer’s metric. The wider figures track the same proposition.
Local procurement by major retailers has risen by 51% since 2019 under the retail sector’s national industrial masterplan, and local manufacturers have placed 371-million additional units on South African shelves. That is competitive growth.
However, the gains have been won against a regulatory floor that has not held every participant to the same standard. A department of employment & labour inspection of 70 factories in Newcastle in November 2022 returned a compliance rate of 8% and issued R148m in enforcement notices. A joint operation four years later, in February this year, produced another round of notices, arrests for immigration offences, workers earning R350 to R750 a week against a statutory minimum materially higher, and workers sharing overcrowded dormitory accommodation with buckets serving as toilets. The conditions, recorded four years apart, tell the same story. This is not a failure of labour law but a failure to apply labour law.
The customs side of the industry tells a parallel story. South African Revenue Service (Sars) data records import undervaluation on clothing consignments rising from R5.2bn in 2014 to R8.52bn in 2018. The dedicated audit team Sars established for the sector in 2019 has recovered R59m over the two most recent financial years, a fraction of what the historic leakage has cost the fiscus and the compliant producer.
In early 2024 the International Trade Administration Commission published a report of unusual institutional candour. Reviewing the persistent abuse of a textile import rebate, the commission acknowledged that despite safeguards designed jointly with Sars and the industry, the loophole continued to be exploited and the agencies best placed to close it could not do so alone. The problem is not the absence of rules but the absence of co-ordinated enforcement.
No re-industrialisation strategy, in any sector, survives the incoherent application of its own rules. New legislation is not what South African manufacturing is short of. What it is short of is co-ordination between the agencies that administer the legislation that exists.
Shared inspection schedules across labour, tax, immigration and industry inspectorates so no operator can arbitrage between them. A clear protocol separating labour reporting from immigration enforcement so undocumented workers are not deterred from reporting wage theft. A public audit of state compliance with local-content rules that already have the force of law. And published compliance data so retailers can source and procure against evidence rather than against assurances.
None of this requires new law. It requires executive discipline. The proof that this is achievable is not conjecture. In Newcastle, the same precinct that produced February’s enforcement footage, vertically integrated clothing manufacturers have operated for decades on fully compliant statutory wages and within the industry’s collective bargaining arrangements.
The firm I manage, Allwear, has operated at the same location since the 1970s and our factory operations uphold world-class manufacturing practices that guarantee safety, and sustainable and environmentally friendly work practices. We pass our audits by the department of labour, received the highest ranking on our health and safety programme, and are in possession of quality business capability verification certification issued by Defcon Protech, a Sanas-accredited authority.
The proposition that South African industrial sites cannot host compliant manufacturing at scale is refuted by the fact that they do, and have done so for many decades. The same pattern of capable, rule-abiding manufacturing exists elsewhere in the industrial base, in parts of the automotive value chain and in metals engineering.
The international comparison is instructive. Bangladesh was forced by the Rana Plaza factory collapse of 2013 into a compliance architecture that buyers and workers could trust. Sector exports grew by about 79% between 2015 and 2022, from $19bn to $34bn. Ethiopia took the opposite path, building a low-wage strategy on the absence of a statutory minimum, and watched international buyers move on as factory attrition passed half the workforce annually. The durable competitive advantage, in both cases, turned out to be consistency of rules and not their absence.
That lesson has wider application than clothing. South Africa sits closer to the Bangladeshi case than to the Ethiopian one. The architecture for disciplined re-industrialisation is already in place. The work that remains is administrative, not ideological, and it is within the capacity of the state.
Clothing is only one illustration. The argument applies across the manufacturing base. A country with a comparable industrial plan, comparable capital and comparable skills should not be outperformed in the execution of its own industrial strategy by its own inconsistency.
Compliance is not government’s problem alone, and treating it as such is a lazy assumption. The regulatory framework sets the floor for every participant in the value chain to uphold their end of the obligations. Unions must act as the watchdogs they were constituted to be. Retailers must conduct genuine due diligence on the procurement chain behind the garments on their shelves. Industry associations must report rather than accommodate members who undercut collective bargaining arrangements. Compliance is a shared discipline, and it fails the moment any link in the chain decides it is someone else’s responsibility.
What is required at government level is modest in form and serious in effect. A standing mechanism that obliges the agencies already holding the relevant mandates to co-ordinate their enforcement. Public reporting of sectoral compliance. Ministerial ownership of policy hygiene as an instrument of industrial strategy rather than as administrative housekeeping. None of it is expensive. All of it is overdue.
- Tau is MD of South African schoolwear, Drimac and fashion garment manufacturer Allwear.
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