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Tuesday 15 June 2021
HomeFeatured NewsTunisia: Textile on live embers is preparing for the worst!

Tunisia: Textile on live embers is preparing for the worst!

It is unanimously asserted that three economic sectors run the risk to be contaminated by the international economic crisis, while European countries are  no more hiding recession. These sectors are those of  mechanical and electrical industry, textile and tourism .

For the first, the warning signs are already there and bosses have raised the issue.. For tourism, things are not yet clear, according to professionals who have not yet met different tour operators. For textile industry, Tunisian exports figures are beginning to show some signs (-10% during the 10 months 2008) and professionals are  in any case preparing for the worst. A study day  on issues and challenges of textile and clothing industry will soon be held by FENATX, the textile employers’ federation expected to  review  the impact of this crisis, on the sector . But already, a recent study provides figures at least meaningful about what awaits this sector, highly exporter and job provider.

Forerunner !

According to official sources, the impact of the crisis is already here. As far as ordering parties are concerned , the  French ones for instance, Tunisian suppliers have already noticed a reduction in volume of orders, spacing collections and attempts to revive crumbling sales by more aggressive promotions at  retail outlets .

Among Tunisian suppliers, ready-to-wear sales are down, and the value of French imports is already declining by 1%, the bottom-of-the line chains being the first to suffer.
A recent telephone survey, conducted among 50 leading exporters of textiles & clothing in Tunisia, showed that 10% of respondents experienced a decline of at least 10% of their turnover in exports, 22% of polled persons report a 20% decrease in exports sales and 8% say  that their export turnover is down between 10 and 20%.

Problems already encountered deal with declining orders, delay in payments of bills and even some outsourcing and relocations to Asia of a part of trademark producers who worked with Tunisian exporters.

An important observation emerged from the survey which may foreshadow more serious difficulties that could lead to a profound restructuring of textile and clothing sector in Tunisia: 10 companies said they had already made sales transactions or establishment of other production units, i.e. closing of textile units or production shift to other units.

What should be done? 

 Faced with these initial elements, professionals and employers’ structures are preparing themselves, not only through meetings and conclaves talks, but also and above all, through  proposals. Many ideas will emerge certainly from the scheduled textile professionals’ meeting. But already, some “good” ideas have been worked out by respondents. For example, a call for a special fund for textiles & clothing, entitled to finance the working capital of companies involved in finished product. Also a call  to redesign funds that have outlived their usefulness, as Foprodex Fund (export promotion) and others which have proven themselves as Famex (Fund supporting  access to external markets ), including the extension  of their action sphere and removal of ceilings for the creation of collections, buyouts of trademarks and commercial establishments abroad. These are daring ideas, while affected exporters are already at work  by seeking new customers, greater presence in foreign fairs and, for some, the creation of own collections.

Backup plan

Time is no longer for half-solutions. The State and structures responsible for the export sector  must imagine, and above all, come up with  a backup plan including plans to revive the sector. Upgrading is not enough and we should not be scared of seeing money leave if necessary to avoid more damage. The funds already exist. Perhaps it would be better to redirect their use , as claimed by professionals..

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