The textile sector drops sales in Spain meanwhile fast-fashion stores resurface
Developing countries’ textile suppliers lost 13 billion dollars in 3 months
Picture taken by Associated Press and published by Euronews
In the month of July 2020, it was reported that the sales from the textile sector where 23% lower compared to the numbers from that same month in 2019. Before the COVID-19 pandemic, this sector had already drop sales at around 19% compared to the year 2007. Now, after the confinement, the textiles factories have suffered big losses, which has affected economically all the employees that work for the production chain. On the other hand, the pandemic accelerated the business digitalization, only benefiting the big companies who produce fast-fashion clothes.
With the drop of sales, Acotex estimated that 20% of the small businesses from this sector shut down, but they calculated that it might escalate to 40%, causing more unemployment with almost 30% of their workers under the risk of losing their jobs. They also estimated that if last year they had an income of 18.000 million euros, this year the income might barely get to 10.000 million. This is a sector that over 100.000 families depend on.
That’s the situation for local small businesses. But for big brands, Spain presented a draft with a recovery plan in October 15 to the EU committee with the proposals from some of the biggest companies in the country. It was reported that up to 1,000 projects could benefit from european funds, 79 of them in Spain, which would require 24,400 million in financing and among which would include, among others, plans from Inditex. The textile giant requested 100 million of these European funds in order to build its new eco-efficient headquarters in Coruña, which will have the latest technologies and will even have studios for the audiovisual production of the online store. The work responds to the objective announced by the president of the group, Pablo Isla, that "80% of the energy" of all the facilities "be renewable" in 2025.
However, although millions of euros have been invested from this company to stick to renewable resources and to compromise with going green, there have been a lot of protests from the workers of these brands all over Europe, from Cadiz and Galicia to Brussels, due to them considering to be under paid and to the fact that a lot of them have lost their jobs while the brand is still opening new branches.
According industrial production data published by the INE, all workshops are working at their minimum due to the fallen of demand. The data also showed that the shoe and leather industries have drop a 31% compared to las year. The general drop of industrial production in Spain was 9,3%, less than half compared to the textile sector. But the textile sector has been shrunken for the last couple of years since the main clothes brands in the country have moved their production factory to countries like Bangladesh or Sri Lanka due to the cheapest salaries they have to pay in comparison to paying minimum wage to workers in Europe.
Acotec (Textile, Accessories and Leather Trade Business Association), published that the sales in store registered a 32% drop during the month of August, which means it suffered a relapse compared to July. In Spain, this was the third most affected sector, only behind the hospitality and leisure industries.
Nov 4, 2020 | ZÚÑIGA Álvaro
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