THE approval of the takeover bid by creditors of Archer Clothing by Harare-based Paramount Garments, which has saved the textile firm from certain liquidation, is a dose of good news for a city desperate for economic revival.
Archer Clothing is one of Bulawayo’s oldest companies having been established in 1953. Before its demise it had become the largest garment manufacturer in Zimbabwe, employing thousands of people.
The takeover by Paramount was approved by creditors at a meeting at the Bulawayo High Court last week.
Paramount has admitted that there is a “significant amount of investment needed to fully resuscitate Archer, refurbish the properties and capital machinery, human resource issues and working capital in stocks and debtors”. The company was placed under judicial management in 2010 after it failed to raise working capital.
Like hundreds of other companies that have closed down in Bulawayo it faced challenges of obsolete machinery that had become too expensive to maintain.
It was also a victim of intensified electricity cuts and cheap imports that have brought the textiles sector in Zimbabwe to its knees.
Archer’s revival is not only important for Bulawayo’s economy, but the textile industry as a whole, which has been on the decline since around 2000. At its peak, the textile sector used to produce about 135 million garments annually, compared to the current 18,7 million garments.
It employed 35 000 workers, compared to current levels of just under 7 000. However, in 2013 the industry showed some signs of recovery after it added over 800 jobs despite the general slowdown in the general economy. At his inauguration in August last year, President Robert Mugabe promised that his administration would prioritise the revival of industry in Bulawayo, which he said now resembled a scrapyard.
Months after the new government began its work, there is nothing yet to indicate that there is a plan to get Bulawayo’s industry working again. However, it is gratifying to note that private investors still have confidence in the city as demonstrated by Archer and the government would do well to build on this.