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Export drama deepens in 2024/ 23% drop for January-February, crisis in textiles and shoes

2024-03-19 07:28:00, Ekonomi CNA

Export drama deepens in 2024/ 23% drop for January-February, crisis in textiles

2024 has started negatively for the majority of Albanian exporters, who are being affected both by the unfavorable conjuncture of international demand and prices on the stock exchanges, as well as by the significant devaluation of the common currency.

Textiles and shoes are continuing to decline for months in a row and factory closures have already begun. Except for "food, beverages and tobacco", and "chemical and plastic products", which recorded a modest increase, all other groups were also in decline.

INSTAT announced that in February 2024 exports of goods reached the value of 32 billion ALL, decreasing by -16.1%, compared to the same period a year ago. In January, exports fell by 29%.

In February, according to INSTAT, During the month of February 2024, in the decrease of exports of -16.1%, the groups: "Minerals, fuels, electricity" with -7.7 percentage points, "Textiles and shoes" with -4.5 percentage points, Construction materials and metals" with -2.3 percentage points, etc. While the groups: "Chemical and plastic products" with +0.4 percentage points and "Food, drinks, tobacco" with +0.1 percentage points have had a positive impact.

Export drama deepens in 2024/ 23% drop for January-February, crisis in textiles

In this two-month period, exports of goods reached the value of 62 billion ALL, decreasing by -23.0%. The groups that have had a negative impact on the annual decrease in exports for two months are: "Minerals, fuel and electricity" with -13.9 percentage points, "Textiles and shoes" with -4.8 percentage points, "Construction materials and metals" with -3.1 percentage points, etc. While the groups: "Chemical and plastic products" with +0.4 percentage points and "Food, drinks, tobacco" with +0.1 percentage points have had a positive impact.

Textiles and shoes do not raise their heads, they have started closing factories

In February, textile and footwear exports, the largest export group in the country (with 30% of the total), fell by 15.7%. For two months, the contraction is 17.6%.

For months, the industry has been going through a difficult period influenced by many factors, such as the increase in costs that has caused partners to move to the Middle East, reducing orders, and especially the devaluation of the euro, which reduces their income when converted to lek. Currently, one euro is exchanged for less than 104 ALL, from 116 ALL in February 2023.

Export drama deepens in 2024/ 23% drop for January-February, crisis in textiles

This situation is forcing many factories to close, according to announcements from the Association of Exporters. The biggest bankruptcies occurred in districts and factories that employed fewer than 120 workers, worked mainly on subcontracts, had lower profit rates and were unable to cope with the crisis.

Construction materials and metals continue to contract

"Construction materials and metals" became the second largest group in the country for two months, with 19.4% of the total. This group is affected by the performance of Kurum, the steel processor, which is one of the largest exporters in the country. In February this group fell by 11.8%, while for the 2nd month the contraction is 17.1%. The sector is suffering from weak regional demand and shrinking prices.

Minerals, fuels, energy with strong decline

"Minerals, fuels, energy" moved to the third largest group in the country, with 18.8% of the total, as a result of the strong contraction in the first months of the year. In February the group reduced sales by 33%, while for the 2nd month the drop is 49%, influenced by the negative performance in January. The group's performance is dependent on sales of Bankers Petroleum, the country's largest exporter, and weather-related electricity trading.

Export drama deepens in 2024/ 23% drop for January-February, crisis in textiles

Eating, drinking and smoking, can hardly be sustained

"Food, drink and tobacco", one of the groups with the best performance in recent years, is showing a modest increase. In February, its exports increased by only 1.5%, while for the second month the expansion was 1.35%. Despite the potential, the sector is being affected by rising costs, which are making it less competitive in the region, as well as by weather conditions.

Machinery, equipment, spare parts are damaged by euros

"Machinery, equipment, spare parts" was another group that showed good performance in recent years, as a result of the entry of factories that assembled parts for the automotive industry. But this group is also suffering from the devaluation of the euro, rising costs and labor shortages. In February, exports fell by 11.9%, while for the 2nd month the contraction is 10.1%.

The trade deficit deepens significantly

While exports continue to decline, imports have returned to growth, significantly deepening the trade deficit. According to INSTAT, in this two-month period, exports of goods reached the value of 62 billion ALL, decreasing by -23.0%, while imports of goods reached the value of 134 billion ALL, increasing by 5.0%, compared to a year ago. . The trade deficit reached the value of 72 billion ALL, increasing by 52.6%, compared to the same period of 2023.

Exports with Kosovo increase, but decrease with Italy, Turkey and China

In February 2024, the country with which Albania had the largest increase in exports, compared to February 2023, is: Kosovo (21.2%). While the countries with which exports have had the biggest decrease are: Italy (-16.2%), Greece (-41.6%) and Germany (-5.1%).

Export drama deepens in 2024/ 23% drop for January-February, crisis in textiles

During this two-month period, the countries with which Albania had the largest decrease in exports, compared to a year ago, are: Italy (-12.1%), Turkey (-9.3%) and China (-29, 2%).

In February 2024, the countries with which Albania had the largest increase in imports are: Turkey (61.4%), Germany (12.5%) and Greece (29.6%). While the countries with which imports have had the biggest decrease are: Italy (-8.9%), China (-27.9%) and Macedonia (-16.6%).

During this two-month period, the countries with which Albania had the largest increase in imports, compared to a year ago, are: Turkey (30.4%), Greece (32.%) and Germany (12.6%) . While the countries with which imports have had the biggest decrease are: Italy (-4.1%), China (-15.3%) and Macedonia (-11.8%).

Trade exchanges with EU countries account for 57.7% of all trade. In February 2024, exports to EU countries account for 74.0% of total exports and imports from EU countries account for 50.7% of total imports. The main trade partners are: Italy (28.1%), Turkey (12.0%), Germany (7.3%) and Greece (7.2%).

Trade exchanges, for the first two months of 2024, with EU countries account for 58.1% of all trade. In the period January - February 2024, exports to EU countries account for 75.8% of total exports and imports from EU countries account for 49.9% of total imports. The main trade partners are: Italy (28.8%), Turkey (10.0%), Greece (7.4%) and Germany (7.2%)./ Monitor.al