ABSTRACT
The worldwide globalization process has brought important challenges to European economies, particularly in traditional manufacturing, of which the textileclothing industry is a prime example. The complexity of the changes forced upon European countries is, to a great extent, due to their heterogeneity, which increased substantially following the enlargements of May 2004 and January 2007.1 Moreover, industries themselves are heterogeneous, being composed of several specialized subsectors that differ with respect to product characteristics, market conditions, employment and value added, structural characteristics, degree of specialization and territorially based relationships (Jones, 2002). The degree of country and industry heterogeneity will become clear when characterizing the current situation of traditional manufacturing in Europe and then focusing on the textile-clothing industry in the Comunidad Valenciana (NUTSII ES52 region in Spain). The choice of industry and geographical area is motivated by four particular features: the historical tendency of the textileclothing industry to agglomerate in space; the importance of the textile-clothing industry in the regional economy of the Comunidad Valenciana; the level of specialization of the Comunidad Valenciana in the home-textiles subsector; the recent developments in the industry, such as worldwide trade liberalization. These features make it a good case study of future opportunities. In fact, it has already been asked whether the textile-clothing industry in Europe is evolving or facing extinction (Jones and Hayes, 2004). Other contributions examine the role of firm characteristics, specialization patterns, or geographical agglomeration in the survival possibilities of the European textile-clothing industry (Stenng, 2001; Taplin, 2006). Further research suggests key strategies such as specialization and diversification towards high value added subsectors in order to survive (Buxey, 2005). The need to restructure the Portuguese textile-clothing industry was analysed by Cristovam (2006). In Portugal, most textile-clothing firms have continued to compete based on low costs both at home and abroad, producing under subcontracting and focusing on the lower-quality end of the market. Given the presence of very low cost producers in countries such as China, this strategy cannot succeed and also perpetuates low wages in the industry. Only a few firms have realized this and started to specialize in higher value added subsectors, focusing
on design, quality and service, outsourcing the labour-intensive tasks to lowercost countries. To most firms, the international outsourcing option is not feasible due to their small size (they had an average size of 11 employees in 2003). Given the very different levels of competitiveness of the firms and their large number, trade associations have found it very difficult to agree on a consensual long-term strategy. Moreover, skill upgrading is a remote option as schooling levels are, on average, very low. In the case of Spain, the Association of Spanish Textile Firms (ACTE) has recently been promoting the study of the influence of the territory and specialization of production on textile firms, suggesting that a district organization with specialization in high value added subsectors may be a solution. Given the high levels of geographical concentration of the textile industry in Europe, reorganization within the industry may be the most feasible option. In this context, this chapter analyses the current difficulties of the textileclothing industry in Europe and points towards an understanding of the implications of specializing on the textile-clothing subsector that is prevalent in the territory where a firm is located. The first part of the chapter studies the main characteristics of the industry, looking at the evolution of demand and specialization patterns. The second part of the chapter analyses the importance of the industry in the EU and, bearing in mind the study that will be presented in the following two chapters, focuses on the case of Spain. Along the same lines, the third part of the chapter examines the presence of the industry in the Comunidad Valenciana from the point of view of the territory and the specialization patterns. Finally, the main conclusions are summarized.
