PORTO, Portugal – Portugal’s textile industry is closely monitoring the developments in the future of the European Union, including Brexit, as its heavily relying on the European market, Paulo Vaz, Director General of ATP, the Textile and Clothing Association of Portugal, told New Europe in Porto on 15 March.

A European “identity crisis” could affect Portugal’s textile industry, as Europe is its main customer, Vaz said, noting that international sales are almost 80%. “We have to follow these clients in a very attentive way.

“Of course, Portugal is quite engaged in this European project. We think there is probably no future for Europe outside of Europe. It will be dramatic disaster if for some reason this European project starts to collapse. Surely, I don’t believe that for instance the UK is going to exit. I don’t believe it. At the end of the day they will remain. But, it could be quite interesting and also quite pedagogical that all these problems we face now could help European leaders to rethink Europe and re-launch the European project and I think Portuguese in a general way they are very engaged in this,” Vaz said speaking on the sidelines of Portugal Fashion at the Alfândega do Porto (old customs house).

The Brexit referendum in 2016 has already taken its toll on Portuguese fashion sales to the UK, losing 12% of the volume.

Despite the economic crisis, for the past 10 years the Portuguese textile industry has grown. Textile is responsible for more than 130,000 jobs in Portugal.

“Fashion from Portugal” programme, which ran through 2016 and 2017 was co-financed by European Structural and Investment Funds (FEEI), by POCI (Internationalization Competitiveness Operational Program) on Portugal 2020 and Compete 2020, has helped the Portuguese textile and clothing industry become more solid, after going through an adjusting period with re-structuration and modernisation.

According to Vaz, turnover of the whole industry is €7.6 billion. “We exported last year 5.3 billion euro. It means we represent 10% of the exports of goods of the country – not services just goods. But our turnover is almost 3% of the GDP,” he said. “We export more in a month than the whole wine industry during a year,” he quipped.

Spain is the main market, he said. “We have a very integrated economy with Spain … But after that countries like France or Italy or Germany, even the UK are very important,” he added. The US market also has great potential, he said.

Environmental awareness and energy saving

Ana Silva, head of sustainability at Tintex, which focuses on sustainable, natural-based textiles, told New Europe that sustainability helped the industry pull out of the crisis.

“We had a very profound crisis in Portugal that affected a lot the textile industry and I think the textile industry of Portugal was one of the successful cases coming out of the crisis. In my opinion it is because we started to adapt and to search for new markets,” Silva said. “We started to be recognized for not only for the production of textiles but production of textiles with quality and also with sustainability so the environmental awareness and social awareness is very connected to the textile industry,” she said.

“In Portugal we have very strict laws regarding environmental issues,” Silva added, explaining that Tintex had the service of dyeing and finishing fabrics for its customers’ products. “We’re huge consumers of energy. In Portugal we have a law to implement a law that in six or eight years you have targets to reduce your consumption,” Silva said.

International brands are looking at Portugal as a textile producer she said. “The fact that we have a cluster makes a lot of sense to produce locally because they can do everything here,” she said.

According to Vaz, 50 kilometers around Porto brands can find textiles, clothing, home textiles, knitwear, shoes, leather, jewelries, and furniture. “All this area is concentrated in Porto like the head of these industries. It is a very interesting fashion cluster and one of the biggest nowadays in Europe,” he said.

The turning point for Portugal’s textile and clothing industry was during the economic and financial crisis, Vaz said. “In 2011, of course, companies suffered because the financial environment was not so easy, especially when the companies need money to invest, to work and to export but it was not the worst part of the scenario. The worst was in 2009, because at the moment there was a crisis of consumption all over the world. Portugal was not the one, it was a global crisis and it was a consumption crisis,” he said, noting that from that moment forward Portuguese small and medium size companies focused more on diversifying their export markets, management organization and participating in international exhibitions.

ATP has helped companies boost innovation and research by working closely with universities and technological centers. “Also in terms of internalization, using our international programmes to go abroad, with our training centres to improve the qualifications of people and also nowadays we’re insisting more and more in terms of sustainability because we believe that it could be one of the fast-growing for the future,” Vaz said.

The Director General of ATP argued that the EU should follow Portugal’s example. “What we can say to Brussels is look to Portugal what we have done with the fashion industry. We took care of this industry. We proved to world that a developed country in Europe can make reindustrialization in a very effective way because we don’t only talk about reindustrialization, we’re doing reindustrialization based on traditional industries that are precisely the industries where we’re much more comfortable because we have tradition, we have knowhow, we have a lot of knowledge of these industries and we’re not doing the same that we have done in the past. But we’re doing in a very innovative way, introducing fashion, introducing design, introducing technological innovation, introducing the new values of society that is sustainability and we can offer to the world this new industry that is an international case study,” Vaz said.