GENEVA — The global financial crisis and the possibility of a worldwide recession could see the textile and apparel industry in for some rough times, industry executives and experts said.
“Companies are facing a credit crunch and this is putting them in difficult positions,” said Francesco Marchi, director of economic affairs at the European Apparel & Textiles Organization. “The demand is not there.”
Marchi, whose umbrella group represents tens of thousands of textiles and apparel companies across Europe, said this is not only in major markets like the U.S., Japan and Europe, but also other countries such as Russia, South Africa and certain Latin American countries, where consumption is down.
“All elements show we’re going to have a difficult period in the next 18 months, if not 24 months,” Marchi said.
Like other industries, he said, the textile and apparel sector in Europe is also shedding jobs.
Debapriya Bhattacharya, Bangladesh’s ambassador to the World Trade Organization, told a United Nations Conference on Trade & Development forum last week that the financial crisis will have impacts on the trade, currency and investment prospects of poorer nations.
In a similar tone, Supachai Panitchpadki, UNCTAD chief, said the impact on developing nations “will be much deeper than was anticipated.”
Supachai, a former deputy prime minister of Thailand and former head of the WTO, added that, “Trade will suffer,” noting volatile exchange rate movements affecting some developing nations “certainly will not help.”
A report published Oct. 16 by the International Labor Organization said the global slowdown “is affecting low-income groups disproportionately” in rich and emerging nations.
Income inequalities, which “have grown excessively” in the majority of countries, are expected to grow further as a result of the financial crisis, said Raymond Torres, director of the ILO’s International Institute for Labor Studies.
How the slowdown in production will impact on labor “we will see the effects within six months,” he said. But the ILO economist said the crisis will also impact major emerging economies like India and China and noted both were not decoupled from the effects of the U.S. economy. At the same time, he noted that China and India, the two biggest emerging markets, have domestic demand dynamics and can explore new growth potential, and this can help limit some of the impact of the financial crisis.
Torres, who was also lead author of the ILO report “World of Work, 2008,” said the study estimates that in the U.S. the chief executive officers of the largest 15 companies earned 520 times more than the average worker, up from 360 times in 2003. He said that while some income inequality is useful in rewarding people making an effort, talent and innovation, too much of a discrepancy can also be harmful to society and “represents a danger to the social fabric, as well as economic efficiency.”
From overseeing America’s fastest-growing speciality retailers to codifying cool, WWD talked to the women who are leading the way for the future of beauty. Check out our Instagram Stories to see how these women built today and are creating tomorrow. (📸: @hannah_khymych) #wwdbeauty
For @laperlalingerie's spring 2018 show, the brand chose to host their event at @thevenetianmacao. With Chinese megastars @bingbing_fan and @hubing in attendance, La Perla debuted a rock ‘n’ roll-inspired collection. The show marked the start of Sands Macao Fashion Week, which runs from October 19 to 24 — the city’s first such event. Pictured here are models backstage with glimmering eyes. #wwdfashion (📷: Cheuk-Yin To)
Trending for spring 2018: top stitch design. Gone are the days of stitch just for seams — designers are using the once-minimal detail to create strong decorative elements. (📷: Paola Testa; Styled by @andrew_shang) #wwdfashion
@tradesy is turning the concept of a showroom upside down with its new space in Santa Monica. Here, the company plans to hold events, art exhibits and a showcase rare fashion pieces like this Louis Vuitton boxing set. Get all the details on Tradesy’s first showroom on WWD.com. #wwdnews
Spotted last night at the @erdem x @hm launch event: Kate Bosworth, Rashida Jones, Kirsten Dunst and Selma Blair. The party, which took place in LA, also marked the opening of their pop-up shop. “I was interested in creating a collection that wasn’t in any way disposable. It was about pieces you’d create and keep forever, things that have a permanence to it,” designer Erdem Moralioglu said. #wwdeye (📷: Katie Jones)
Renee Zellweger in yellow in 2001 and again in 2017. Chosen as one of the 12 @pantone Leading Spring Colors (and dubbed “Meadowlark”), it only makes sense that the bright hue stands the test of time and is making a resurgence this season, seen already on stars like @blakelively and @gigihadid. (📷: Donato Sardello & @rexfeatures) #wwdfashion #tbt
Dior’s 70th anniversary celebration continues with a new exhibition at the Royal Ontario Museum in Toronto. “Christian Dior,” which is scheduled to run through March 18, takes a look at the founders tenure from 1947 to 1057 and feature 40 designs. Pictured here is an evening gown from the Ailée, fall 1948-49 haute couture collection. #wwdfashion (📷: Brian Boyle)