Manufacturing & garment industry

Manufacturing & garment industry

Unlike in other sectors of the Albanian economy, the global financial crisis has produced a positive impact on the clothing industry in Albania.  Supported by 20 years of experience in production (albeit partial) for important companies in Western Europe, Albanian manufacturing companies have improved their processes as they have transitioned from manufacturers with ordered material to genuine manufacturers.  Furthermore, there is a greater number of factories able to offer finalized products (i.e., products that they have produced start to finish) than there were only two years ago.

Entrepreneurs from the largest factories are purchasing raw material from abroad and proceeding to complete the production processes, where upon trademark sportswear manufacturers then export to countries like Italy, Germany, the Netherlands, and France.  Also, several international organizations have supported the clothing sector.  The USAID program, “Rritje Albania” [Competitive Enterprise Development], is assisting Albanian entrepreneurs with increasing the quality of production, increasing their production capacities, improving enterprise management, and finding new markets.  At the same time, the German Program for Technical Collaboration (GTZ) is assisting with enhancing labor processes.  In this sector, the goal is to coordinate these projects, which is also what the directors of Albanian clothing and fashion companies seek.

The history of the clothing industry in Albania is tremendously strong as it was among the main sectors of the Albanian economy until the 1990s.  Operating under the conditions of a centralized economy, the industry not only oversaw the entire chain of production from the raw materials (e.g., raw fibers) to the conclusion of the final products (e.g., fabrics, clothing, and rugs), but even produced locally a considerable amount of the raw material.  The sector met over 70 percent of the demands of the domestic market and it was also important in terms of exports.

Following the economic transformations of the early 1990’s, state factories were privatized and both the function of the textile industry and the ideology of production changed substantially.  Albania no longer produces raw materials and the factories no longer produce fabric, but factories have been producing clothing with ordered material, which is then exported (in technical language: production under the regime of active processing), during the past 20 years.  Through this regime, hundreds of factories continue to produce clothes for well-known brands in Western European markets.

Since the end of 2008, the effects of the global financial crisis have reduced the demand for clothes in European markets, which, considering that over 90 percent of Albania’s exported clothing goes to these countries, was reflected in a slight decrease in demand in the Albanian market.

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