Kabelo Tjeketsi
In a bid to revive the faltering textile industry, the government has launched a desperate initiative to breathe new life into the once-thriving sector, now teetering on the brink of collapse.
Minister of Trade, Industry, and Business Development, Mokhethi Shelile, leading the charge to tackle the challenges afflicting the textile sector, sounded the alarm and acknowledged the dire state of the industry.
“The textile industry has been a key player in the economy for many years. However, in recent times, the industry has been facing several challenges, including the COVID-19 pandemic, the global pandemic led to a slowdown in the global economy, and many countries reduced their orders for textiles and other goods from Lesotho,” Shelile said.
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He indicated that this resulted in a decline in revenue for the industry and therefore job losses.
He explained that in addition to the pandemic, the industry has also faced competition from other countries with lower labour costs, such as Bangladesh and Vietnam, and an increasing cost of production.
“These challenges have put pressure on the industry and forced it to adapt and find new ways to remain competitive,” he added.
The situation is dire, with factories closing at an alarming rate and thousands of workers facing uncertain futures.
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Shelile emphasised the urgency of the government’s response.
He shed light on the plight of ACE Apparel, a longstanding fixture in Maputsoe, Leribe, with a history spanning two decades and used to boast a workforce of approximately 1300 employees.
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Tragically, the company’s operations grounded to a halt following the mysterious disappearance of its former owner.
“In light of the distressing circumstances surrounding ACE Apparel’s closure, the Ministry has taken decisive action to address the situation,” Shelile said.
“We have intervened to cease any industry action at ACE Apparel, and I am pleased to report that employees are already mobilising to restore the working environment, signaling a hopeful return to normalcy,” he added.
The minister acknowledged the deep-seated concerns of ACE Apparel’s employees, particularly regarding their payroll, which had been entrusted to the absentee owner.
To alleviate the employees suffering, he said the ministry has facilitated the transfer of the employees’ payroll from absentee owner, a measure aimed at providing much-needed relief to those affected.
The scheme, backed by a M150 million loan, represents a crucial lifeline for textile enterprises navigating turbulent waters
Similar stories of struggle pervade other textile firms like Ever Unison and Bold Clothing, which have faced insurmountable hurdles.
Ever Unison, with its workforce of approximately 1067 employees, fell victim to the harsh realities of economic downturn and operational hurdles.
However, Shelile said there was a glimmer of hope on the horizon as discussions with management have yielded plans for the firm to resume operations by the month’s end.
Similarly, Bold Clothing, based at Ha Thetsane in Maseru and employing 186 individuals, faced insurmountable challenges, including alleged difficulties in securing Value Added Tax (VAT) returns from the Revenue Services Lesotho (RSL), ultimately leading to its closure.
On a brighter note, Shelile revealed promising developments regarding Sun Textile, which once employed around 549 individuals.
He said despite the firm’s closure, a new investor has emerged, signaling a potential resurgence for the company.
He explained that before the reins could be handed over to the new management, it was imperative that the current management settled outstanding terminal benefits to ensure a seamless transition and lay the groundwork for a fresh start.
To address industry-wide challenges, Shelile said the government had launched a multifaceted approach, including targeted interventions to address various industry woes.
He outlined plans to provide financial assistance to struggling firms, facilitate access to raw materials through partnership initiatives, and streamline regulatory processes to enhance competitiveness.
The minister elaborated on collaborative efforts between Standard Bank Lesotho (SLB) and the Lesotho National Development Corporation (LNDC) aimed at bolstering struggling textile companies.
Together, he said, SLB and LNDC have established a ground-breaking facility designed to assist businesses grappling with order fulfillment challenges by facilitating the procurement of raw materials.
He said this initiative was envisioned to elevate Lesotho’s textile industry, ensuring that garments manufactured in the country attain 100 percent value.
“The scheme, backed by a M150 million loan, represents a crucial lifeline for textile enterprises navigating turbulent waters,” he said. He further stressed that the initiative was tailored to address the specific needs of companies facing difficulties in finalising or processing orders, serving as a vital bridge to overcome operational hurdles.
Shelile indicated that applications for assistance had begun to trickle in, and expressed confidence in the scheme’s efficacy.
