South Africa’s largest trade union federation, the Congress of South African Trade Unions (COSATU), has backed calls to ban online shopping platforms Shein and Temu over concerns that their growing presence is hurting local businesses and threatening jobs in the clothing and textile industry.
The decision was taken at COSATU’s 15th National Congress following a recommendation by the Southern African Clothing and Textile Workers’ Union (SACTWU), which argues that the platforms’ low-priced imported products make it difficult for local manufacturers and retailers to compete.
The campaign comes amid growing concerns about the impact of cross-border e-commerce on South Africa’s domestic retail and manufacturing sectors.
Shein entered the South African market in 2020, while Temu launched in the country in 2024. Both platforms have attracted shoppers with low prices, a wide range of products and aggressive online marketing.
A study commissioned by the Localisation Support Fund estimated that the two platforms generated combined sales of about R7.3bn, equivalent to $444.1m, in South Africa in 2024.
The study found that Shein and Temu accounted for 3.6 per cent of the country’s retail clothing, textile, footwear and leather market, as well as 37 per cent of online sales in the sector.
The findings have intensified concerns among local businesses, which say overseas platforms are gaining market share while domestic manufacturers struggle with competition from cheaper imported goods.
According to the study, the growth of offshore online retailers was associated with an estimated R960m, or $58.4m, in lost local manufacturing sales between 2020 and 2024.
It also estimated that 2,818 manufacturing jobs and 5,282 retail jobs that might otherwise have been created were displaced during the period.
The report warned that the impact could worsen, projecting that more than 34,000 jobs across the clothing and textile manufacturing and retail sectors could be displaced by 2030 under its worst-case scenario.
The figure is a projection and does not represent the number of jobs already lost.
COSATU and SACTWU believe restricting the platforms could help protect local industries, support domestic production and preserve employment.
However, the National Clothing Retail Federation of South Africa has warned against an outright ban, arguing that the government should address the wider regulatory and competitive challenges facing the retail industry.
The federation’s executive director, Michael Lawrence, told CapeTalk that banning the platforms would be a one-sided response to a problem with several causes.
He called on the government to examine how offshore retailers operate in South Africa and whether they comply with the same rules as local businesses.
Lawrence also warned that a ban could reduce competition in the retail market, although he acknowledged concerns about the effect of offshore platforms on employment.
Tax compliance has emerged as another point of contention in the debate.
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In August 2024, the South African Revenue Service announced that value-added tax would apply to imported goods valued below R500, following concerns that some e-commerce imports benefited from tax arrangements that gave overseas sellers an advantage over domestic retailers.
Before the change, certain low-value imports received more favourable tax treatment, raising concerns about an uneven playing field for local businesses.
Lawrence said questions remained about whether the changes had fully addressed the problem. He told CapeTalk that some invoices he had seen raised concerns about whether the correct taxes and duties were being paid, while acknowledging that the documents might not reflect the final amounts charged.
Beyond the effect on businesses, a ban could also affect consumers who rely on Shein and Temu for affordable clothing and other products.
The platforms offer a broad selection of goods and home delivery, allowing shoppers to avoid some of the transport costs associated with visiting physical stores.
Lawrence said consumers should be free to decide where to spend their money and argued that households should not bear the cost of problems that could be addressed through government policy and stronger enforcement.
He also raised concerns about consumer protection, saying customers could face greater difficulties enforcing their rights when purchasing from overseas sellers than when dealing with local retailers.
South Africa’s online shopping market has continued to expand, with the Localisation Support Fund study estimating that e-commerce penetration rose from 2.4 per cent in 2015 to 9.9 per cent in 2024. The figure remained below the reported global average of 35.6 per cent.
COSATU’s decision has strengthened calls for government action, but no ban has been announced. Authorities face competing demands to protect local jobs, ensure fair competition and preserve consumers’ access to affordable products.
The government’s eventual response could shape the future of cross-border online shopping and the regulation of international e-commerce platforms in South Africa.
About the Author
Cecilia Attah is a tech analyst with a degree from Benue State University. She covers tech news and startups at TechRegard with a focus on how technology is transforming Africa and shaping the global landscape.
