Garment footwear exports grow by 8%

TIRANA, July 30 – After a shrink in 2012, garment and footwear products the traditional top Albanian exports until 2011, have recovered during the first half of this year thanks to stable demand by top trade partner Italy, which is the destination of the overwhelming majority of 88 percent of these products. Germany remains the second top destination with a 4.7 percent share followed by Greece with a 3.5 percent share, according to the state Institute of Statistics.
INSTAT data show exports of garment and footwear products grew by 8 percent to around 34 billion lek (Euro 237 million) in the first six months of this year, overcoming the slight decline in 2012.
Affected by sluggish demand by crisis-hit EU partners, garment and footwear products, the traditional top Albanian exports, were for the first time in the past 20 years of the country’s transition to a market economy overtaken by exports of “minerals, fuels and electricity.” Overwhelmingly dependant on demand from crisis-hit hit top trade partner Italy, the destination of 50 percent of total Albanian exports and 85 percent of garment and footwear products, the fa谮 industry expected 2013 to be more difficult in terms of manufacturing and employment.
Representatives of the National Chamber of Garment Producers expect demand for Albanian textile products to further deteriorate in 2013 as Italy remains in recession and problems with payments of bills in time escalate.
Data show some 470 textile companies operate in Albania currently employing around 60,000 people compared to 100,000 just before the onset of the global financial crisis. The garment and footwear industry now accounts for 30 percent of total exports, having dropped to the second most important group of exports.
Under the new fiscal package approved by Parliament, the 20 percent VAT on imported machinery and equipment has been lifted only for investments of Lek 50 mln (Euro 351,000) or more.
Diversification of markets, considering that the majority 80 percent of these products go to Italy and the remaining share mainly to Germany and Greece is another concern for textile producers.
Several manufacturing factories in southern Albania exporting to Greece closed down or suspended work. INSTAT data show exports of this group grew by 13 percent year-on-year in 2010.