Fashion and Clothing Entrepreneurs in East and West Africa Struggle with COVID-19 Economic Impacts

Celestin Ntawirema.

Ysolde Shimwe and Kevine Kagirimpundu started their dream business in 2013 in Kigali, Rwanda. They cater to tourists and expatriates with an eco-friendly shoe store, UZURI K & Y. Like other non-essential businesses during the pandemic, lockdowns and a slowing of tourism during COVID-19 forced their team to look at new ways to reach customers.

“We used to get people passing at our shop for direct purchasing, and people got to interact with the products and the sales ladies, now it has shifted to buying online. Before COVID we only had 3% of revenue coming from the online and today we have 14% revenue coming from the online sales,” said Shimwe, the company’s Creative Director and Co-Founder.

In the Democratic Republic of Congo (DRC), in Bukavu, a young entrepreneur at 27 years old, Yuston Nessy, is a fashion promoter and owner of The One Fashion Week. His company provides a platform for local and international fashion designers to showcase their designs.

“This place is known as the hub of fashion in the Eastern DRC, many people used to come all over the region to shop from us but now, we have none. Just very few people who also pay little,” Nessy said.

While there have been no government imposed lockdowns in Bukavu, there are also no tourists and few international residents who usually support his events. “When you have an event, you organize it and you want people to buy tickets and attend, so we had no experts or tourists in the country who could come to our event. But we did our best to host The One Fashion Week 2020 last year,” she added.

Small and medium businesses contribute to the African’s economy which makes up to 80% of the employment of the continent and those in the fashion industry are contributing to this percentage and they will need to continue to get creative. The fashion sector itself in Africa contributes to the global economy at 1.9% of global trade. The global fashion industry was estimated to be worth $1.3 trillion and estimated to be worth $2 trillion by 2020. In Africa, the entire textile and clothing market is already worth more than $31billion, according to the African Development Bank.

On Thursday 17 June 2021, the WHO announced a third wave is affecting African countries. New lockdowns have already been imposed in 2021 and more are expected as COVID-19 creates a fragile health care system.

The continent of 1.3 billion people has 1.6 % of the population fully vaccinated as of July this year. The continent records more than 6,100,00 cases and 155,564 deaths. Among 54 countries, the Seychelles comes the highest rate of vaccination with vaccinated 69% of its population, according to the World Health Organization (WHO).

The impacts of the COVID-19 on small businesses are expected to continue. Governments face a difficult choice of protecting citizens from illness and death during lockdowns and restrictions given the significant economic impacts of these actions. New covid – Delta variant which is spreading very faster on the continent is pushing governments leaders to lockdown again to decrease the rates of death and infected cases.

Before the pandemic, many African countries had growing economies and investments in infrastructure were supporting this growth. Countries were also developing business platforms to facilitate business and attract international investors. Tourism was also an important investment with many countries counting on this as a steady source of growth, according to World Bank

This has all been at a standstill due to the pandemic. An estimated 24.6 to 30 million jobs could be lost, driving up the total number of people living in extreme poverty to 40 million. The continent’s GDP in 2020 fell by 2.1%, the worst economic performance in half a century. While recovery is possible in 2021. According to the African Development Bank, African governments still need additional gross financing of about $154 billion in 2020/21 to respond to the crisis.

Historically, doing business in Africa has been challenging, particularly for young entrepreneurs, due to lack of access to capital, regulations and fluctuating economies.

Esther Lami, a fashion designer, holding a Master’s degree in International Law and Diplomacy. switched from working for others to being an owner of multiple private companies in Nigeria.

“I have a cleaning business, I have a fashion business and an advertising business, you know in Africa, really you cannot rely on one thing, we are trying to find different resources of income, if one is not working or if one is out the season, another one will pick up,” Lami said.

Before the pandemic, Lami had been attending and selling her fashions in events and exhibitions around the continent. But the pandemic impacted most of her companies.

“You know in Nigeria we used to go for the big deals such as wedding ceremonies every weekend, parties, but no ceremonies anymore. People don’t buy clothes anymore. To be honest, COVID affected everything here,” Lami said.

Layered on those challenges is the increase of the cost to import goods from abroad. The African Development Bank has cited this as a barrier for small businesses.

The supply chain has impacted UZURI K &Y’s in terms of cost and time. Materials used to take 45 days, but now it is taking about 90 days or more. “In terms of the supply chain, we have had a lot of challenges, because at least 95% of our raw materials are imported from everywhere around the globe, starting from Tanzania, Kenya, Asia and Europe,” Shimwe said.

In Ghana, Uwase Fathia, owner of a fashion house, Fathia Creations Ltd, said that finding fabrics and other materials to use in her shops has been difficult and expensive, impacting the cost of her products. And the quality of goods she could find in Ghana was low.

“First, I thank my clients who continued to support me till now. It was not easy to sell during this period for sure, but with my clients, I was making clothes and ship via DHL, and they are happy with my services. I am happy, I am still running my business. Fathia said.

Since the beginning of the pandemic crisis, some international organizations, such as the World Health Organization (WHO), World Bank, European Union and the COVAX initiatives, have provided interventions, especially in the health sector and economic recovery.

“In Rwanda, the EU has been collaborating with the government to prevent the spread of the COVID-19 and providing support to people who were impacted most through humanitarian support, responding to the basic needs of populations through health and broad socio-economic support. This was done through the Ministry of the Local government (MINALOC),” Ambassador Bellomo said.

“As the European Union organ’s activities are concerned, we are supporting in the economic and revenue of countries and regions in coping with the situation,” Ambassador Bellomo said.

The EU is planning to introduce new measures to connect skills on the labor market to continue supporting entrepreneurs in Rwanda and Africa.

“This is something that is important in our agenda in our member states, we are trying to develop team Europe approaches to develop entrepreneurship, we are working with the government of Rwanda in terms of long-term supporting to the entrepreneurs and there is agenda of 2050 which is clear. we will continue to develop and support entrepreneurs not only in Rwanda and also in other countries of Africa,” Ambassador Bellomo said.

The entrepreneurship is clear indeed in the EU’s strategy to continue supporting skills development for young entrepreneurs in Africa to become more creative and more productive, Ambassador Bellomo added.

In response to the COVID-19 crisis, African countries have also introduced programs to support economic recovery for local businesses.

In Kenya, fashion designer Nehema Georgina Obiero, creates and produces women’s wear under her company BrandMe Fashion House LTD. Tax breaks from the Kenyan government were important for her business.

“Our government decided to look at tax measures in order to support the affected individuals and businesses from the negative impact of the COVID-19 outbreak, so, the decrease of the value-added tax rate from 16% to 14% and this really helped some businesses to survive during this period,” Nehema said.

The Rwandan government set a budget of Rwf100 billion in the Economic Recovery Fund (ERF) for local businesses hit by the COVID-19 to apply for the funding. However, the fund to accelerate business recovery in Rwanda has increased this year to Rwf350 billion as announced at the press conference in Kigali by Richard Tusabe, the Minister of State in charge of the National Treasury in the Ministry of Finance and Economic Planning.

While recovery efforts will help, Shimwe encourages young African entrepreneurs to look at e-commerce as an opportunity to reach more clients.

“They need to look at the market as different as it was before, I tell them to use the available opportunities, like open social platforms such as Facebook, Instagram, Twitter and a website to promote their businessto a wide audience.”

Nehema said she believes that the African fashion entrepreneurs have to continue pushing until things become normal again.

“Nothing is easy. My business is going up and down, going up and down again, but I know I have to keep going,” Nehema said.

African entrepreneurs also have to see this period of the COVID-19 as an opportunity for innovation and creativity in what they do to sustain their business.

“There is an opportunity for entrepreneurs who will put innovation and creativity especially in services delivery, the crisis changed many things. The entrepreneurs have to continue to find new ways and opportunities. We see many young entrepreneurs start and doing designing clothes, they have to make sure the quality of their products is good and competitive” Ambassador Bellomo said.

Even if the covid-19 crisis continues for African entrepreneurs, they will need a strong determination to be able to continue their businesses, finding networking and connections will help them to grow their businesses. Some countries are putting some infrastructures to help entrepreneurs and they should be taken this as another opportunity. Ambassador Bellomo added.

There are some African initiatives to help fashion industry continuing to grow such as the Fashionomics Africa which is an initiative of the African Development Bank Group to foster the fashion industry in Africa as a lever to create jobs. According to Fashionomics, the global fashion industry is estimated to be worth USD $1.3 trillion in Africa, it could be worth $15.5 billion in five years as incomes grow.

The writer is Celestin Ntawirema, Freelancer journalists and communication specialist