Clothing, textiles, leather, and footwear (CTLF) sector of South Africa has been a priority sector for the government for almost two decades. However, the CTLF sector has not been able to achieve the reindustrialisation levels envisaged by the government and other stakeholders. It is therefore necessary to explore the possibilities of gaining competitive advantage and also understand the challenges facing the sectoral systems of innovation that impede the development of the CTLF sector in South Africa. Through the triple helix theory of innovation and Porter’s diamond model of competitive advantage, this review paper looks at the CTLF sectors of two BRICS nations, Brazil and South Africa, in an attempt to determine the factors that could jump-start the competitive development of the South African CTLF sector. This paper outlines proposals for improving the sectoral systems of innovation in South Africa’s CTLF industry, which should help it gain competitive advantage. It also makes a scholarly contribution to designing strategies that could be used to enhance collaboration among the BRICS nations.

BRICS, clothing and textiles industry, competitive advantage, regional hubs, sectoral systems of innovation, triple helix.

The global output of the clothing, textiles, leather, and footwear (CTLF) sector increased from USD993.6 billion in 2022 to USD1.7 trillion-dollar in 2024 (Smith, 2024). With the global production growth of 97% (textiles) and 175% (clothing) (Sinha, 2015), the CTLF sector is an important global economic sector (Wang & Norsaadah, 2024). Sinha (2015) indicates that the BRICS association is the largest producer that accounts for over 40% of the global gross domestic product and supplies goods to over 7 billion people. According to Grand View Research (2022), the compounded annual growth rate (CAGR) between 2022 and 2030 is expected to be around 4%. Although the global CTLF sector declined during the COVID-19 pandemic and in BRICS it suffered the same fate, its share in the global economy is significant and its importance for society should not be underestimated.

Over the years, the increasing value that the BRICS countries adds to their products is putting pressure on South Africa to explore its value adding possibilities in order to claim a bigger share of the CTLF BRICS market and other markets (Kocourek, 2015). The recent expansion of BRICS+ and successful operation of the New Development Bank inspires further research into the potential of the member states (Kipgen & Chakrabarti, 2022) and funding opportunities for the CTLF sector (Sinha, 2015). According to Msibi (2024), the BRICS member countries may have access, among other things, to trade opportunities and knowledge-sharing collaborations, which is most important for the South Africa as a BRICS member and its CTLF sector, especially given its proximity to other African countries (Sinha, 2015).

Pressures and opportunities like these inspired this paper’s research into the sectoral systems of innovation (SSI) of South Africa and Brazil as an attempt to assist the South African CTLF sector in gaining competitive advantage. Mbatha and Mastamet-Mason (2023: 161) define sectoral systems of innovation (SSI) as “a means by which a sector seeks to create, acquire, disseminate, and put into practice new knowledge that helps a sector improve its competitive advantage and socio-economic contribution to a country”. Manzini (2015) suggests that researchers conduct studies focusing on SSI to develop evidence-based policy interventions that support a sector’s innovation, competitiveness, and socio-economic development through policy. Such development would add value to the CTLF products and could result in increased competitive advantage and market share in the BRICS group and the rest of the world.

Recent studies that use the triple helix theory demonstrate its robustness (Chux et al., 2017). However, few of them have so far applied this theory to the CTLF industry in the BRICS countries. Tahir and Tahir (2019) support the idea that the BRICS countries need more studies using Michael Porter’s diamond model. There is a large body of knowledge about the BRICS countries (Naudé et al., 2013; Kocourek, 2015; Wang et al., 2018; Lohani, 2020), and specifically South Africa and Brazil (Mesquita & Seabra, 2022), but no studies have been found that focus on comparing the CTLF sector in Brazil and South Africa. This present paper seeks to close these gaps, adding to the broader debates about how to improve BRICS’ effectiveness as a global player. Also, it explores the possibilities of obtaining sustainable competitive advantage and creating the SSI in the South African CTLF sector.

More than a decade ago, there were attempts by the South African CTLF sector to learn from its China’s counterpart: a delegation was sent to China aiming to gain expertise that would assist in gaining competitive advantage (Mbatha & Mastamet-mason, 2023). CTLF sector consulting firms are involved in benchmarking activities, which should help to study the best practices of countries with a strong CTLF sector in BRICS and beyond. (Mbatha & Mastamet-mason, 2021), but little knowledge exists about possible lessons from Brazil’s CTLF sector, despite the relations through BRICS. This gap serves as a crucial motivation for this paper’s focus on Brazil and not other CTLF majors of the BRICS group. The paper reflects on the CTLF sector of Brazil and South Africa in the BRICS context and on the prospects of deepening collaboration as advocated by Msibi (2024). The following research questions are explored in this paper:

• How does the SSI for the South African CTLF sector compare to that of the CTLF sector in Brazil?
• What lessons are there for the CTLF sector in South Africa to learn from the CTLF sector in Brazil?
• Can SSI policy recommendations arise from the comparison between the BRICS nations?

Over the last three decades South Africa’s CTLF sector has been the key to the country’s reindustrialisation (Molala, 2024; Mbatha & Sihlobo, 2024). However, research has not assisted in unlocking South Africa’s competitive advantage potential (Mbatha, 2021) nor helped optimise the SSI for the CTLF sector (Mbatha & Mastamet-mason, 2023). The persisting competitive advantage-related challenges, as well as difficulties in building SSI make this paper highly important for the South African CTLF sector. Through the triple helix theory and Porter’s diamond model, it examines the role that South African and Brazilian sectors, universities and governments play in promoting collaborations and improving South Africa’s competitive edge.

Mbatha (2014) applied the triple helix theory of innovation and Porter’s diamond model to the South African CTLF sector and concluded that collaborations between CTLF sector players should be encouraged to enhance the country’s development efforts. Although the theory and the model were designed decades ago, only recently have they been integrated into CTLF-sector-related studies (Mbatha, 2021; Mbatha & Sihlobo, 2024). In the present paper, the author explores their triangulation in the context of BRICS development.

The authors of the triple helix theory Etzkowitz and Leydesdorff (1998) advocate for a nexus between university, industry, and government to supercharge innovation, economic growth, socio-economic development, and design of competitive advantage strategies (Distefano et al., 2015). According to Mbatha (2022), it means that the government should design policies for South African CTLF sector development, promote research, provide incentives for collaboration, and finance research infrastructure. CLTF sector firms, in their turn, should fund research collaborations, design technology, embrace innovation, have first-hand access to research results, provide guidance to the ongoing research projects, and allow researchers to get access to their infrastructure. Universities are to provide human capital, carry out sector-oriented research activities, and introduce sector-oriented curricula (Mbatha, 2021). As it is not clear, which universities, sectors, and governments of the Global South perform at internationally competitive levels, more research into the issue will be necessary.

The triple helix model used to measure and support innovation has evolved into quadruple and quintuple helix models (Carayannis & Campbell, 2012; da Costa Minerio et al., 2021) but scholars continue to use the triple helix theory and diamond model (Chux et al., 2017). In the South African CTLF sector context, they have been applied since 2021; the research is still at its infancy stage. The studies by Mbatha & Mastamet-mason (2021), Sihlobo & Mbatha (2022) and Mbatha & Mastamet-mason (2023) have shown that this model can generate new knowledge for meeting the SSI challenges of the South African CTLF sector, thus motivating further use of the triple helix in the context of the BRICS economies.

Porter’s diamond model has been widely used to investigate and explain competitiveness of the Global North countries (Tahir & Tahir, 2019). His earlier theory of competitive advantage (Porter, 1990) maintains that when a firm or country operates among globally competitive firms or countries, this environment may have beneficial effect on its competitiveness. The diamond model employs four determinants, namely (i) industry strategy, structure, and rivalry, (ii) demand conditions, (iii) related and supporting industries, and (iv) factor conditions; it shows that chance events and government policies can support or hinder the creation and exploitation of competitive advantages (Porter, 1998).

Das (2011) applied the diamond model to the CTLF sector and identified the factors that may determine competitive advantage. The researcher shows that South Africa has supportive trade- and research-related policies necessary for gaining competitive advantage and creating a SSI. Her study also highlights policy-related factors that impede on competitive advantage and development and SSI, such as resistance to cooperation among producers. Having outlined the factors that prevent South Africa from achieving a positive balance of trade and building an effective sectoral system of innovation, professor Das argues that South Africa has international relations and sophisticated customers necessary to have an innovative economy and a competitive trade balance.

Figure 1. 

Application of the diamond model to the South African CTLF sector (Das, 2011:12)

Building on Das (2011), Mbatha (2014) explored the chance events and government involvment as factors of competitive advantage of the South African CTLF sector. Mbatha found that the Council on Higher Education (CHE) of South Africa is not involved in the development of trade policies and strategies to achieve competitive advantage. This paper recommends that higher education institutions be part of the policy formulating bodies through the CHE (see Figure 2). Its author also argues that, to gain competitive advantage in textile production, South Africa’s textiles industry needs to be rebuilt. Mbatha also calls for reviewing the national compliancy rules to ensure adequate wages and decent working conditions which he views as a means of enlarging the size of the domestic market.

Figure 2. 

Proposed implementation of a competitive advantage strategy for the South African CTLF sector (Mbatha, 2014)

Using Porter’s diamond theory, Mbatha (2014) introduced higher education institutions as a possible source of the sector’s competitive development and detected gaps in the SSI of the South African CTLF sector. Using the triple helix theory as a theoretical framework, Mbatha and Mastamet-mason (2023) found that today the SSI in the South African CTLF sector is fragmented and competitive development is therefore above the industry’s potential. They examined the existing trade policies and proposed university, industry and government collaborations aiming to create a competitive advantage in the South African CTLF sector.

Mbatha and Sihlobo (2024) used the triple helix theory and Porter’s diamond model to explore the role of university, industry, and government research and development linkages in improving competitive advantage in the South African CTLF sector. Figure 3 summarises the researchers’ findings derived from government, university, sector, and consulting firms’ personnel working in CTLF-related roles (Mbatha & Sihlobo, 2024).

Figure 3. 

Role of government, university, sector, and consulting firms’ personnel working in CTLF-related roles (Mbatha & Sihlobo, 2024)

The paper by Mbatha and Sihlobo (2024) shows that neither triple helix theory nor Porter’s diamond model have been taken into account by universities’ CTLF-related programmes or the government’s R&D projects. Its authors argue that integration of the triple helix theory and Porter’s diamond model has the potential to improve the theoretical foundations of the country’s development-oriented policies.

The present study employs the triple helix theory and Porter’s diamond model to better understand the SSI and assess the competitive advantage endeavours of the CTLF sector of the two BRICS nations with a view to designing an effective SSI and fruitful competitive advantage policies in the South African CTLF sector.

Figure 4 indicates that BRICS is home to almost half (42%) of the world’s population. The BRICS countries possess 30% of the world’s land area and therefore own a significant share of the global natural resources used as the CTLF sector manufacturing inputs (Sinha, 2015; Han et al., 2024). BRICS account for slightly more than a quarter (26%) of the world’s gross domestic product and a fifth (20%) of the world’s exports and imports.

Figure 4. 

BRICS economies’ numbers (Han et al., 2024)

Figure 4 shows that South Africa is the smallest in size and contribution among the BRICS member countries. The South African CTLF sector operating in the environment of the BRICS CTLF sectors may be viewed as a sector working among globally competitive sector (other BRICS nations’ sector). Over two decades of its existence, the BRICS association has matured into one of the political and economic powerhouses that inspires further growth of the BRICS member countries (Sinha, 2015). Msibi (2024) argues that the BRICS group’s importance in the global networks is comparable to that of G20 countries.

According to the global data and business intelligence company Statista Research Department (Smith, 2024), the BRICS group is arguably one of the global powerhouses in the CTLF sector, with almost a trillion dollars in revenue in 2024. The BRICS market for CTLF sector products is expected to grow by around 4% to 7% between 2024 and 2028. The demand for environmentally sustainable CTLF sector products supports this growth because the number of environmentally conscious BRICS consumers has been increasing since the COVID-19 pandemic. Sinha (2015) indicates that the BRICS grouping is the largest producer, supplying to over 7 billion people and responsible for over 40% of the global GDP. Given the BRICS countries’ share of the global CTLF sector, valuable lessons may be drawn from the experience of the countries successfully contributing to the global CTLF sector market.

Before and after the COVID-19 pandemic, BRICS CTLF-related studies have mostly focused on import and export operations between the BRICS countries and surrounding regions (Kuzmina, 2024; Wysokinska et al., 2020). These studies are typically based on data relating to trade, foreign direct investment, import and export dates; most of them use quantitative rather than qualitative methods of study. Mokgokong and Mukonza (2023) focused on R&D financing within the BRICS countries to draw policy lessons for the South African government. They point out that while some of the BRCIS countries were doing well in funding their R&D, South Africa was not. Their results corroborate those by Mbatha and Mastamet-mason (2023), showing that the South African SSI in the CTLF industry are fragmented and therefore ineffective. Overall, there is an urgent need for comprehensive study of the BRICS countries’ successful experience in building effective sectoral systems of innovation in CTLF sector as a result of the joint work of the sector, university and government; coupled with clear understanding of South Africa’s competitive advantages, it may prove most beneficial for the country’s development and also strengthen the economic power of the whole BRICS group.

The population of Brazil is 215 million (Makgetla & Zondi, 2024). The CTLF sector in Brazil is two centuries old, which means that many generations have been involved with CTLF production (Delta Máquinas Têxteis, 2024). There are 25,000 CTLF companies in Brazil (ILO, 2022), which formally employ between 1.34 to 1.5 million people and informally around 8 million (Delta Máquinas Têxteis, 2024). According to the Brazilian Association of the Textile and Clothing Industry (ABIT), the CTLF sector in Brazil generated revenue of USD3.5 billion in 2021 (Events, 2023; Delta Máquinas Têxteis, 2024). Statista Research Department (2024a) predicted that in 2024 it would amount to USD32.95 billion. In 2021, with an investment of just under USD1 billion, Brazil’s CTLF sector produced 8.1 billion pieces (Events, 2023; Delta Máquinas Têxteis, 2024). According to the machinery company Suntech Textiles (Events, 2023), the country’s CTLF industry is the second largest employer in the manufacturing sector, ranking fifth in global textiles segment and fourth in clothing segment (Events, 2023; Delta Máquinas Têxteis, 2024). It accounts for 2% of the world’s total GDP (Galatti & Baruque-Ramos, 2019). Given its successful performance, the sector obviously has certain competitive advantages.

Figure 5 shows investment in Brazil’s CRLF sector over the years 2016-2020, which grew from around 56% in 2016 to over 91% in 2020. This compelling investment in CTLF sector machines has been instrumental in developing complete value chains and boosting competitive advantage nationally and internationally (Galatti & Baruque-Ramos, 2019; Events, 2023; Delta Máquinas Têxteis, 2024; Jeunon et al., 2024). It certainly improved Brazil’s position on the international CTLF market .

Figure 5. 

CTLF sector of Brazil investment (Jeunon et al., 2024)

Brazil exported CTLF products to the value of USD1.14 billion. Its CTLF sector is ranked 26th among the global textile exporters (Sinha, 2015; Delta Máquinas Têxteis, 2024) and 11th in revenue generation on men’s and women’s apparel markets (Statista Research Department, 2024b). Brazil prides itself on having complete value chains and ample investment (Events, 2023) even though in 2022, Brazilian textile imports amounted to USD 5.9 billion (Delta Máquinas Têxteis, 2024), i.e. Brazil has a negative CTLF sector trade deficit. To drive down this deficit, the country will need to develop more strategies to improve innovation systems and use its competitive advantages more effectively.

The population of South Africa is around 60 million (Makgetla & Zondi, 2024). South Africa’s CTLF sector is over two centuries old, indicating that generational sector knowledge has been passed down (Mcdowell, 2000). There are 4,500 CTLF firms (DTI, 2020). In 2022, the CTLF sector had 71,000 formal and 15,000 informal employees (Molala, 2024). Its revenue was estimated at USD5.9 billion (Statista, 2024). According to Brandstories (2023) on Independent Online (IOL), more than USD1 billion has been invested over thirty years to modernise the South African CTLF sector and improve its global competitiveness (Sinha, 2015). With this investment, the South African CTLF sector is expected to produce 1.6 billion pieces by 2028 (Statista Research Department, 2024). In 2005, the South African CTLF sector had been the second largest employer in the country. Sixteen years later, in 2021, it was the sixth largest employer (De Beer, 2023), but these figures are still rather modest compared to the glorious days of South African CTLF industry (Mbatha & Mastamet-mason, 2015): since the termination of multi-fibre agreements almost three decades ago, the CTLF sector of South Africa has continued to deal with competitive advantage-related challenges (Paulo, 2020; Mbatha & Mastamet-mason, 2023; Mbatha & Sihlobo, 2024).

To drive exports, South Africa’s trade agreements provide it with a 17.5% duty advantage in the European and United States of America markets (Sinha, 2015). Given this competitive advantage, South Africa exported CTLF products valued at USD1.9 billion in 2022 (Molala, 2024). The African Growth and Opportunity Act (AGOA) played a significant role in CTLF trade: CTLF goods’ export value has increased by 62% since its introduction. Yet, the South African CTLF sector has SSI-related constraints that limit its possibilities, including those connected with exploiting the AGOA (Mbatha and Mastamet-Mason, 2023). The relationship between the degree of innovation in the sector and success of its products on international markets requires further research.

The CTLF product imports grew by 223% from 2001 (ZAR18.7 billion) to 2022 (ZAR60.4 billion) (Molala, 2024). The reviewed literature shows that South Africa has a negative CTLF industry trade deficit, i.e. the country imports more than it exports. Table 1 provides more insights into the source of the South African CTLF industry trade deficit through product description, presenting the top ten CTLF products imported in and exported from South Africa. One can see from this table that the country imports non-knit men’s suits, leather footwear, and non-knit women’s suits and other cloth articles with the average trade deficit of -85%. This deficit demonstrates a competitive advantage opportunity, i.e. possibility of import substitution that requires catching up with competitors, some of which are located in other BRICS member countries. To use this opportunity, South Africa needs to improve its systems of innovation and design strategies aimed at creating competitive advantage.

Value added in manufacturing has been constantly declining from 5% in 1994 to 3% in 2019 to 2% in 2022; the CTLF industry’s gross domestic product contribution has also been shrinking: 0.59% in 1994, 0.25% in 2019, and 0.22% in 2022 (Molala, 2024). These data sets indicate that the CTLF sector in South Africa has been getting smaller for around three decades, which was attributed by Mbatha and Mastamet-mason (2015) to the persisting lack of competitive advantage.

This section explores the CTLF SSI of Brazil and South Africa in order to draw lessons from the experience of the CTLF sector leader among BRICS.

Brazil’s sectoral system of innovation

The CTLF sector of Brazil prides itself on having established a “complete production value chain” (from fibre production to fashion shows) and a “complete textiles value chain” in the Western hemisphere (Events, 2023). Jeunon et al. (2024) support this by stating that the CTLF sector of Brazil is self-sufficient in cotton production and a global leader in home textiles, jeans, and sportswear. According to Events (2023), Brazil successfully established globally competitive CTLF sector regional hubs in the northeast, southeast, and southern regions at Santa Catarina and Brusque (leader in the textile), Gaspar (leaders in children’s fashion), Agreste de Pernambuco (leaders in denim jeans), and Ceará (leaders in CTLF industry production and technological innovation), which significantly contribute to the transformation and modernisation of the CTLF sector of Brazil. Through its systems of innovation, the CTLF sector of Brazil is increasing the use of nanotechnology to improve product functionality and artificial intelligence to boost production efficiency. This is possible thanks to its substantial investment in research and development (Events, 2023; Delta Máquinas Têxteis, 2024) (see Figure 6).

Figure 6. 

CTLF sectoral systems of innovation of Brazil (Jeunon et al. 2024)

General transformation and the use of cutting-edge technologies are credited for the impressive figures of the CTLF sector in Brazil (Events, 2023). According to Delta Máquinas Têxteis (2024), investment in research and development (R&D) led by the University of Sao Paulo has been a crucial factor of its success. The dramatic reduction in the time of travel from Europe to Brazil was also most beneficial (Jeunon et al., 2024).

The University of Sao Paulo began to actively participate in Brazil’s CTLF sector development in 1993. Weiss, Rahechini Junior, and Hwa (1993) penned a paper titled ‘Textile industry: Opportunities for research institutions’, which outlined measures that the Brazilian CTLF sector needed to implement in order to achieve the impressive figures stated above and to boost its national and global economic significance. Three decades later, the role of the University of Sao Paulo is entrenched in the CTLF sector, as evidenced by 2021 activities, including the modernisation and transformation of the industry and the establishment of a complete production textiles value chain (Delta Máquinas Têxteis, 2024).

In 2021, the ILO and the National Service for Industrial Learning (SENAI) of Brazil published a report about “research into the future demand for vocational training in the textile sector in Brazil” (ILO, 2021). Brazil’s innovation actors, such as private sector professional training institutions, the federal government, sectoral associations, labour unions and textile industry, are to ensure that the country’s CTLF sector should meet the challenges it may face in the future. Good practices of future skills acquisition are shared through the South-South platforms that facilitate knowledge transfer among developing countries. For some reason, however, the University of Sao Paulo is not involved in these projects (Weiss et al., 1993; Delta Máquinas Têxteis, 2024).

The South African CTLF sector engagements with the ILO were centred on promoting decent work through productivity and workplace cooperation interventions in the CTLF industry from 2023 to 2025 (ILO, 2023). The key players in these South African ILO projects have been the National Bargaining Council for the Clothing Manufacturing Sector (NBCCMI), business support organisations (BSOs), and the South African clothing manufacturing sector. The absence of training institutions in ILO projects related to the South African CTLF industry is notable, probably leading to persisting skills challenges in the CTLF industry labour force.

The two BRICS countries’ ILOs have very different stakeholders. Perhaps the presence of training institutions, CTLF sector and government as stakeholders is the key ingredient of the Brazilian CTLF sector’s transformation and efficient long-term strategic implementation. South Africa does not have training institutions, as stakeholders.

The lessons drawn from Brazilian experience for the South African CTLF sector, underpinned by the triple helix theory and Porter’s diamond model of competitive advantage, include the following:

• South African CTLF sector needs to develop complete value chains to be globally competitive within regional hubs
• Universities are to produce more sector-relevant research
• The country needs a general agreement on a South African version of SSI
• There is a need for a medium of instruction between the two BRICS countries.

It is important to highlight the South African CTLF sector’s awareness of potential areas that can amplify its SSI and form the core of the competitive advantage. The literature highlights these competitive advantage opportunities as areas of high potential for investment (Jenkin & Hattingh, 2022; Department of Trade and Industry, 2020):

• Sportswear
• Technical clothing
• Outdoor products and accessories
• Sewing threads
• Unprocessed wool
• Mohair
• Spinning, weaving, and finishing of textiles
• Knitted and crocheted fabrics and articles
• Manufacturing of apparel
• Dressing and dying of fur
• Leather seat cover manufacturing for the automotive industry
• Manufacturing of protective clothing for hazardous industrial environments, clothing for the mining and chemical industries
• Manufacturing of school, military, and law enforcement uniforms
• Manufacturing of workwear.

This paper extends the list to include human capital investment, R&D and investment opportunities in tertiary education programmes. These three elements will sustain the CTLF sector’s SSI required to gain the competitive advantage necessary to improve South Africa’s BRICS contribution.

It is obvious that Brazil has been more successful than South Africa in transforming its CTLF sector. Its universities played a crucial role in transforming the CTLF sector through R&D activities. The role of government in supporting long-term strategic objectives with policies and financial resources is evident. The investment in the world-class CTLF machinery firms and globally competitive regional hubs allows Brazil to attain its long-term strategic objectives of the CTLF sector development.

Lessons presented in this paper for the South African CTLF sector were drawn from the literature on the CTLF of Brazil and South Africa using the triple helix theory and Porter’s diamond model as a theoretical framework. This paper highlights the issue of the declining South African CTLF sector’s value chains and emphasises the need for effective use of its competitive advantages, outlining the necessary policies.

This paper draws scholarly attention to the need for research into the development of complete CTLF industry value chains within globally competitive regional hubs, highlighting the importance of exploring BRICS as a possible partner in developing the CTLF sector’s competitive advantage. Further studies are required to understand in what way the BRICS partnership can contribute to the South African CTLF industry development and how the BRICS countries’ experience could benefit the South African CTLF sector.