Profil Textile Garment

TEXTILE & GARMENTS INDUSTRY PROFILE A. Definition of Industry 1. Description The history of the Albanian textile and garment industry lies in an almost 40 year’s period of state owned enterprises, which operated under the centralized socialist economy. The previous industry production was derived through a large domestic valuedadded chain that used to produce from fiber until final product. Industry mainly supplied the domestic market, while exports were managed by a single government agency. After 1990, most of the enterprises went through a privatization process. A significant part of these enterprises didn’t change their destination, they kept producing textiles and garments but their activity was now concentrated on production under outward processing regime of clothes which comprise the majority of the Albania’s exports. The industry inputs are mainly supplied by imports, using the cheap labor advantage. The garment firms have no special technological processes, no marketing strategies and poor vertical integration, consequently leaving abroad most of the value added in this sector. This industry plays an important role in the country’s economy as shown in Table 1. Table 1: Key Indicators for Textile/Garment Industry General data Production (in mln Leke) 1999 Share in manufac t. industry 8% 2000 Share in manufac t. Industry 10% 25% 10% 7.6% 2001 Share in manufac t. Industry 2002 Share in manufact . industry 11% 30% 11% 7%

3,235

4,24 5 9,12 9 347 616

4,93 5 8,86 5 298 477

9% 6673 27% 8% 4% 1212 9 407 558

No. of 8,626 24% employees No. of 327 9% firms Investment 19% rate (in 690 mln Leke) Source: INSTAT , 1999-2002

Garment industry production has been increased progressively, as a result of attractiveness of cheap labor found by foreign investors for their Outward Processing Productions. This is reflected also in the increasing number of employees (almost all

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women), number of firms (often joint-ventures) and an investment level