JOHANNESBURG—South Africa has introduced a 45 percent tax on all clothing imports, with the measure aimed specifically at “exploitative” online marketplaces based in China.
Labor unions say the tariff will protect the local clothing manufacturing industry and save thousands of jobs.
But many South Africans are unhappy with the measure, which has kicked in just before Christmas.
Siphithi Sibeko, spokesperson for the South African Revenue Service, told The Epoch Times the hefty surcharge is a “targeted response” to two Chinese “fast fashion” online marketplaces that have been described as China’s answers to Amazon.
Shein and Temu, which launched in South Africa in 2020 and 2024 respectively, export products from China directly to consumers around the world, using loopholes to escape tariffs.
Their clothes have been extremely popular worldwide, including in South Africa, because they’re much cheaper than locally-produced apparel.
“I bought jeans on Temu for 325 rands ($18). In the shops here in Johannesburg those jeans will sell for almost one-thousand rands ($55),” said Mavis Nxumalo, waiting in line for a taxi in the city center.
“I am one of many people who cannot afford the clothing made here in South Africa,” she told The Epoch Times.
“It’s easy for the government to say, ‘Buy local,’ like you see them saying on TV. They are rich; we are not. That’s why I am against this tax that now makes Temu goods just as expensive as the local goods.”
But the director of South Africa’s National Clothing Retail Federation, Michael Lawrence, welcomed the new clothing tariff.
“It’s always terrible to pay more for something, but we have to look at the bigger picture here. It’s important that we live in a society where there’s equality and fairness,” he told The Epoch Times.
“These online marketplaces have been using their particular and peculiar modality to exploit loopholes and to evade duties. Their behavior also seriously undermines both our manufacturing capacity and our ability to have good, responsible retail trading for consumers.”
Lawrence said customs fraud, linked to shipments from Shein and Temu in particular, “is one of the biggest challenges facing clothing manufacturers. Goods are misclassified or under-invoiced to evade tariffs and then sold at lower prices, undermining local factories.”
He added that there are differences of billions of rands between exports declared in China and imports declared in South Africa.
Lawrence said Shein and Temu had been “abusing” an exemption granted to clothing imports worth less than 500 rands since 2007.
United States Took Similar Actions
The South African action is similar to that taken by the United States.The White House said the plan was intended to stop the “abuse” of an exemption that allowed packages worth less than $800 to enter the United States without facing tariffs and other fees.
In a statement, it said the “de minimis” rule has helped firms such as Shein and Temu, which typically ship directly from the manufacturer to the customer, undercut competitors with lower prices.
Etienne Vlok, policy officer for the Southern African Clothing and Textile Workers Union, said the business model used by some large e-commerce retailers, including Shein and Temu, “belongs to the trash heap.”
“There’s great exploitation of workers in the factories that produce clothing for them. Long hours; low wages. But also the products that are being made are often of very low quality,” he told The Epoch Times.
Shein and Temu have denied these allegations.
South African representatives of both companies declined to comment directly, instead referring The Epoch Times to statements the companies made in response to the taxes imposed on them by the United States in September.
In those statements, Shein and Temu insist that their “competitive prices” come from “supply chain efficiencies and operational expertise,” not from circumventing rules or exploiting tax loopholes.
Temu said its success was due to an “efficient business model that cuts out unnecessary middlemen, allowing us to pass savings directly to our consumers.”
Shein said its success came from its “on-demand business model.”
Part of Nedbank’s assessment reads: “Both companies exploit economies of scale to ship goods by air freight to delivery partners around the world while keeping unit costs low.
“Since they have no overheads to pay on local brick-and-mortar stores or logistics infrastructure, they use their resources to flood the market with ads, especially on social media, where their paid promotions are unavoidable.
“Local competitors simply don’t have the advertising budgets to compete for attention.”
The chairman of South Africa’s Institute of Chartered Entrepreneurs, Tebogo Khaas, said offshore global e-commerce sites that cater to local consumers “threaten the nation’s reindustrialisation.”
“We sympathize with the economic hardships and high prices faced by all South Africans, but it’s important for consumers to understand the negative effects of unfair competition from Shein and Temu on the local manufacturing sector,” he told The Epoch Times.
“The affordability of products from these platforms should not come at the cost of undermining local industries and the jobs they provide.
“These businesses selling into our country do not invest in infrastructure locally, nor do they employ locally—a net loss to South Africa.”
But the protection of local industry and jobs is little consolation for the many South Africans who’ve ordered Christmas gifts from Shein and Temu.
“My prediction is that much of this clothing won’t be claimed at customs, because the buyers will be unable or unwilling to pay an extra duty of almost 50 percent on them,” said Lungile Ntsalaze, an economics professor at the Johannesburg Business School.
