The financial crisis: impact on key clothing markets and suppliers

The purpose of this paper is to analyze the impact of the international financial crisis on key clothing markets and their suppliers.

The analysis was undertaken on the basis of trade figures from the International Trade Centre (ITC) and Eurostat over the period 2005‐2009, and in particular over the period July 2007 to July 2009, when the strongest impacts from the crisis can be seen.

The different markets and suppliers have been impacted rather heterogeneously by the crisis. The key regional suppliers to the EU and the USA – Turkey and Mexico – have seen large falls in their clothing exports, as well as their textiles imports and exports. However, the EU has also seen major reductions in its trade. Others have been less strongly affected in the clothing sector. In textiles, trade fell in both directions everywhere, confirming a general tendency for intermediate product trade to be more affected by the crisis than final trade in goods. The research shows that certain sectors have been less strongly affected than others. However, the impacts have been heterogeneous across countries. The figures for the EU were extracted in euros, but also converted to dollars for comparison. The results vary quite considerably depending on the currency used for analysis.

The paper analyzes, for the first time, the most up to date trade data relating to flows over the period of the crisis. Through analysing the impacts of the economic downturn the potential impacts on the industrial landscape after the crisis can be better seen.