PORTO, Portugal — Exports to the U.S., Spain’s fast-fashion empire and a growing request for home textiles should drive Portugal’s textile industry to growth, despite ongoing political unrest, its clothing and textile association ATP said.
The federation reported a 3.5 percent rise in exports of apparel and fabrics between January and August of this year, as Portuguese industry slowly emerges from the financial crisis and the government continues to grapple with its swollen public debt.
Last week, Portugal’s opposition Socialists vowed to topple the center-right minority government with a no confidence motion, after the nation’s president re-appointed Pedro Passos Coelho prime minister. Passos Coelho’s popularity waned after he spearheaded austerity measures that helped the nation emerge from recession.
Portugal’s economy, which shrank more than 6 percent between 2011 and 2013, is expected to grow 1.6 percent this year. The jobless rate remains at a high of about 12 percent.
“What is happening now is brand-new because the hard left could either take over or support the current government. It brings some anxiety and worry but our textile industry has always been adaptable and will continue to focus on growth and innovation as always,” ATP’s general director Paulo Vaz told WWD on the sidelines of Portugal’s fashion week, which unfolded between Lisbon and Porto.
Vaz said revenues of the textile and clothing sector rose nearly 4 percent in the first half. He sees revenue from exports rising to 4.8 billion euros, or $5.3 billion at current exchange, in 2015, just shy of the record mark of 5 billion euros, or $5.5 billion, that the clothing and textile industry achieved in 2001, when it was composed of twice as many companies and had twice the work force.
“We can reach 7 billion euros [$7.7 billion] in [total] revenue for the whole industry in 2015,” Vaz said, noting that the U.S. apparel and home wear industry is emerging as a major driving force. “It is probably one of our major markets. It ranks fifth after Spain, France, Germany and United Kingdom,” he said, adding that revenue generated from the U.S. rose 30 percent last year, and 30 percent in 2013.
Spain and the U.S. remain the markets with greater absolute growth — 85 million euros, $93.6 million, for Spain and 44 million euros, or $48.4 million, for the U.S. — when compared to the same period in 2014, rising 8.6 percent and 29.8 percent, respectively, between January and August.
“We believe we can achieve 600 million euros [$661 million] in exports to the United States. We expect to continue this trend over the next year. By 2020 we can have the U.S. in third position in the ranking,” Vaz said.
U.S. retailers like Macy’s are a main client of Portuguese interior textiles, while firms such as Nike and New Balance are noted customers in Portugal’s “technomoda” world of high-performance fabrics that regulate body temperature and sweat absorption.
Overall, more traditional markets are interested in Portuguese fabrics, due to its proximity and because it is an economical European solution that offers premium quality and craftsmanship similar to that of Italy or France.
One of Portugal’s biggest clients is Spanish behemoth Inditex, whose headquarters in La Coruña is about a 2.5-hour drive from Portugal’s textile heartland. More upscale brands are interested in Portugal for its innovative lace and knitwear.
Couture brands are working with Portuguese companies for the same reason that fast fashion is working with Portugal. The structure is the same, Vaz explained.
“People want a good relationship, short turnaround time and a real partnership with sophisticated suppliers, with whom they can create designs and codevelop new fabrics,” he said.