19 September 2012

Mozambique: Country Hopes to Rebuild Clothing Sector

Maputo — The Mozambican textile and clothing industries are beginning to re-emerge after a near total collapse in the 1990s.

The sector now has about 20 factories but many are operating below capacity, and producing only when they receive orders.

At the end of the 1980s there were 78 textile and clothing factories - but they closed, partly due to the obsolescence of their machinery, and partly because the liberalization of the market meant that Mozambique was inundated by cheap textiles from Asia and second hand clothes from Europe. The collapse of textile and clothing factories threw tens of thousands of workers out of their jobs.

Some of the textile factories, such as Texlom in Matola and Textafrica in Chimoio, had been major employers, providing jobs for thousands of workers. The government was so confident of Mozambique's place as a cotton and textile producer that one of the components of the ten year "Prospective Indicative Plan", intended to make the 1980s the decade in which underdevelopment would be defeated, was a gigantic textile factory in the central town of Mocuba.

Built with East German assistance, this would have been the largest textile plant in southern Africa. But the war of destabilisation, severing the road and rail links between Mocuba and the port of Quelimane, ensured that this factory was never finished.

According to Nuno Maposse, coordinator of the Information and Marketing Services of the government's Investment Promotion Centre (CPI), in recent years the country has received a series of proposals for investments in textile and clothing plants.

In particular, over the past two years, the Office for Accelerated Development Economic Areas (GAZEDA) has received six proposals for such factories in Industrial Free Zones and Special Economic Zones. These are areas where companies produce mostly for export, and enjoy generous tax benefits.

One new factory is under construction in the central province of Sofala - but most of the proposals are still on paper.

One possibility for the export of Mozambican clothing is provided by the Africa Growth and Opportunity Act (AGOA) passed by the United States Congress in 2000, allowing eligible African countries, including Mozambique, to export a range of goods to the US market free of duty and quotas.

However, Mozambican clothing companies have proved unable to make much use of AGOA. Last year, Maposse told AIM, they only exported to the US market goods to the value of 183,000 dollars, while other SADC (Southern African Development Community) member states exported clothing worth over a million dollars. Maposse admitted that the clothing exports under AGOA were still "a derisory amount".

Any factory producing textiles or clothing for the Mozambican domestic market would face formidable competition from the importers of cheap and second hand foreign clothing, some of it legal, but much entering the country illegally.

To discuss these problems, government institutions and operators from the textile and clothing sector will meet in a workshop in Maputo on Thursday.

"At this meeting, we want to discuss the existing problems and propose ways of solving the", said Maposse. "We will also show the opportunities that exist on the national, regional, European and other markets. The challenge is to identify mechanisms to guarantee success for this sector in the future".

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