The Central Bank of Swaziland informed the closure of 18 textile companies since July 2004 with work force being almost halved.
Fifteen thousand garment industry jobs were lost in one year. We still have a massive unemployment problem, but conditions are on the way to improvement, a source from Finance Ministry said.
Earlier, Swaziland's clothing and textile industry had increased its exports and created thousands of jobs under the African Growth and Opportunities Act (AGOA).
Since the ending of the textile and clothing quotas begining January 2005, created an avenue for more cost-effective producers, such as China and India and pushing out Swazi garment makers.
World Trade Organisation ended International Multi-Fibre Agreement which gave an opportunity to China to export textiles and garments to Western markets and United States in particular, informed Bheki Dlamini, CEO of the Swaziland Investment Promotion Authority (SIPA).
The textile industry suffered blows one after another. It was hit initially due to delay in approval of AGOA II. By the time AGOA II approval came through, China had entered the world market causing a 50 percent decline in prices. This was the second blow, observed Robert Maxwell, head of the Swaziland Exporters Association.
The repercussion of this was to survive, and factories cut costs and laid off workers.
Unable to attract clientele from the garment trade, a transport and freight clearing company shut down, other service providers suffered enormous losses.
Maxwell predicted that they can now be optimistic as the situation is improving. Streamlined apparel companies are recovering. His company makes sports wear for Russell Athletics in the US and is fully booked till mid 2007 and that there is no dearth for orders.
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