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WWD Special Report issue 09/19/2014

PRATO, Italy — Less than a year after the Dec. 1, 2013, factory fire that killed seven Chinese workers here, the city is more determined than ever to bring its illegal operations out of the shadows, and to promote collaboration between Italians and Chinese in the textile and fashion sectors.

This story first appeared in the September 19, 2014 issue of WWD. Subscribe Today.

In March, police arrested five people in connection with the Teresa Moda fire in the city, located about 14 miles north of Florence: the Italian owners of the factory building, and the fashion firm’s three Chinese managers. The media storm following the tragedy put the city government and the region of Tuscany under intense scrutiny — and that has led to a long-overdue boost in staff at the Prato courthouse, said chief prosecutor Piero Tony, noting 12 administrators and some 50 warehouse inspectors have been hired this year.

Tony, who has been in Prato since 2006 and recently announced his retirement, said that for many years, the city had underestimated its own growth and therefore neglected to increase government personnel to keep up with the pace. From 1950 to 2014, the local population increased from about 73,000 to 190,000, according to the city’s statistics bureau. The province of Prato, meanwhile, now has close to 250,000 residents.

Warehouse inspections and arrests “multiply the number of cases open, and we were already on our knees,” he said, noting that of Prato’s 3,600 textile and garment factories, about 2,500 were Chinese-run. He compared illegal warehouses to ghost towns hiding hundreds of workers: With the windows and doors shut, many look vacant from the outside.

Just which fashion labels from which countries are manufacturing in these factories is difficult to ascertain, but Tony said police investigations had revealed that a few big-name brands are involved. “There are Italian brands that are above suspicion, major brands that have turned [to the Chinese in Prato] to make for two cents what they sell for two million,” he said.

Matteo Biffoni, Prato’s recently elected mayor, replaced center-right Roberto Cenni this year and has promised to make safety in the textile and garment industries a priority.

“On the one hand, we plan to intensify inspections,” Biffoni said. “But the facts have shown that inspections aren’t enough: You need to intervene across various fronts.”

For instance, it’s equally important to crack down on illegal cloth imports, he said, and to cut off the cash flow streaming from under-the-table operations back to China.

Where Biffoni differs the most from his predecessor is in his emphasis on education as a weapon against crime. “We need to make sure that respecting the law becomes ingrained in our culture,” Biffoni said. “Schools are the biggest tool, but we also need to work with trade associations, with business owners themselves.”

Two major waves of immigration have left their mark in Prato’s recent history. In the mid-20th century, a large number of poor southern Italians emigrated north in search of work, and in the Eighties and Nineties, when globalization began straining Italian textile mills, thousands of Chinese set up shop in Prato’s abandoned warehouses.

Precise estimates of the number of Chinese residents currently in Prato are hard to come by. Still, officials say the Chinese represent more than 20 percent of the city’s citizens — and as many as a third are children. Biffoni said that’s a key statistic, as many of these kids were born in Italy and feel Italian. He would like the national government to make it easier for the children of legal immigrants to obtain Italian citizenship, perhaps after completing a certain number of years of school.

“The important thing is not to make the mistake that has been made elsewhere, of making people feel excluded from their own country,” he said.

Textiles and fashion are so tightly woven into Prato that visitors need not speak to city officials to come into contact with the industries — or with the city’s multiculturalism.

Romano Mannucci, a taxi driver, said his family used to run a textile plant, but sold it in 1996. Angiolo Barni, the chef at Enoteca Barni, a popular restaurant built around his ancestors’ wood-fired brick oven, said he has catered many Chinese weddings over the years.

Meanwhile, at Ravioli Liu in the heart of Prato’s Chinatown, numerous Italian patrons could be seen among the Chinese regulars. Hong Xuemin, the owner, said she opened the place in 2011 after moving to Prato from Shenyang. Down the street on Via Fabio Filzi, two teenage girls had finished school for the day: One was born in Italy, the other in northern China, and both said their parents worked in fashion. Their names were Elena and Sofia.

Built in 1969, the San Giovanni Battista di Maliseti church, a short distance from central Prato, is a reference point for many immigrants in need, and counts about 150 Chinese Catholics among its faithful, said parish priest Santino Brunetti. He chafed at the negative depiction of the Chinese in the Italian media.

“There are Chinese exploiting Chinese, but there are also a lot of Italians exploiting the Chinese,” he said, suggesting that many Italian fashion brands were guilty of producing in illegal warehouses. “We can’t insist on legality if we aren’t legal ourselves. People say the Chinese send too much money abroad… What about all the Italian money sitting in Switzerland? There is great hypocrisy at play.”

Brunetti compared the current prejudice against Chinese immigrants to that experienced by southern Italians who moved north in the Sixties. Many were disparagingly called “terroni” (“people of the land”) and stereotyped as unreliable by their Tuscan and Lombard counterparts.

“That’s why school is so important. It puts different cultures together and makes them feel equal. The same process took place with the southern Italians; in the long run, everything became normal,” he said.

Instead of automatically shutting down illegal warehouses, Brunetti said he would like inspectors to actively help those running them make the transition to legality.

“Good politics educate, they don’t repress; repression leads to revolt or revenge. Education is much slower, but it’s effective,” he said.

That’s an idea Andrea Cavicchi, president of Prato’s industrial union (UIP), a trade group with more than 60 percent of its members in the textile sector, has already taken to heart. Cavicchi said that since last December’s fire, there had been much greater dialogue between the city’s Italian and Chinese companies — so much so, the UIP now has two Chinese businesses on the roster, and is working with the region of Tuscany on plans to help textile and garment companies meet legal operating standards.

To do this, “we also need to find housing for all the undocumented immigrants, and temporary residence permits tied to real jobs. It’s going to be very difficult, which is why we need both national and European support,” he said, adding that trade associations such as the National Confederation of Artisans and Small to Medium Businesses, which now has about 70 Chinese member companies, also played an important role.

Prato isn’t going it alone, either. Leading trade organizations in Lucca and Pistoia, two important manufacturing cities east of Prato, have banded together with the UIP in a new organization that, starting in 2016, will represent all of them.

According to the UIP, Prato currently employs more than 34,700 people in its textile and apparel industries. Data from ISTAT, the Italian statistics agency, showed that in 2013 the city’s unemployment rate was 5.7 percent, compared to 12.2 percent for Italy as a whole.

If the Italians and Chinese “can truly integrate [their] two quasi-parallel districts, if we can structure a supply chain that goes from thread production to cloth to garments, we will have the world’s greatest district,” Cavicchi said.