Exports do not stop falling, shrinking 12% for January-July/ Textiles and shoes, in a difficult situation

2024-08-20 08:31:00, Ekonomi CNA

Exports do not stop falling, shrinking 12% for January-July/ Textiles and shoes,

Illustrative photo

Exports have continued with the negative performance even during the month of July, influenced by the weak results of the groups of minerals and fuels, food products and textiles and shoes, influenced by the devaluation of the euro and by the drop in prices due to overproduction in Europe for the products agricultural. The deep decline has been cushioned somewhat by the good performance of the construction materials group.

According to INSTAT data, in July 2024 exports of goods reached the value of 33 billion ALL, decreasing by -12.0%, compared to the same period a year ago and by -4.1%, compared to June 2024.

The pace of decline has accelerated again compared to June, when the contraction was 8.9%. In May, the contraction on an annual basis was 12.4%. In April 2024, exports of goods had increased for the first time in many months by 1.8% on an annual basis. In March, exports had shrunk by 21%, in February by -16.1% and in January by 29.2%.

During the month of July 2024, the reduction of exports by -12.0% was influenced by the following groups: "Minerals, fuel and electricity" with -11.3 percentage points, "Textiles and shoes" with -4.0 percentage points, "Food, drinks, tobacco" with -0.7 percentage points, etc. The following groups have had a positive impact: "Construction materials and metals" with +3.0 percentage points, "Chemical and plastic products" with +1.4 percentage points, etc.

For the seventh month, exports have recorded a strong contraction. According to INSTAT, in this seven-month period, exports of goods reached the value of 233 billion ALL, decreasing by -14.5%.

For the 7th month, the Groups that have influenced the annual decrease in exports are: "Minerals, fuel and electricity" with -6.0 percentage points, "Textiles and shoes" with -5.2 percentage points, "Construction materials and metals" with -2.2 percentage points, etc. The group: "Chemical and plastic products" had a positive impact with +0.1 percentage points, etc.

Source: INSTAT

Textiles and footwear in distress

In July, exports of textiles and footwear, the largest exporting group in the country, fell by 13.2%. For the 7th month, textile-shoe exports were 65.3 billion ALL, with a contraction of 17.8% on an annual basis.

The industry continues to suffer the consequences of 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.

For the period January-July 2023, one euro was exchanged for 112 ALL on average, according to the exchange rate of the Bank of Albania, while for the same period of this year it is exchanged for 102 ALL, or almost 10% less.

This situation is forcing many factories to close, according to announcements from the Association of Exporters.

Minerals, fuels fall significantly

"Minerals, fuels, energy" was the second largest group in the country. In July, this group returned to strong contraction by 44.1%. This group is affected by the performance of Bankers Petroleum, the country's largest exporter, and by weather-related electricity trading. For the 7th month, this group recorded exports worth almost 44 billion ALL, with a 27% contraction. In July, exports to Spain, which is Banka Petroleum's main destination, shrank by 53%.

Source: INSTAT

Building materials and metals with strong growth

"Building materials and metals" was the third largest group in the country for 7 months. This group is affected by the performance of Kurum, the steel processor, which is one of the largest exporters in the country. In July this group significantly improved sales, with an increase of 21.3%. however, for the 7th month, the sector is down by 8.4%.

Strong contraction for Food, beverages and tobacco due to falling prices

"Food, drink and tobacco", one of the groups with the best performance in recent years, recorded the most negative performance in July as well, although at a slower pace, falling by 5.6% in July, from the 32% that was the contraction in June . For the 7th month, this group has decreased by 9.4%.

Exporters claim that the contraction is mainly related to falling prices due to overproduction, while exported quantities continue to be high. This year there has been overproduction across the Mediterranean, driven by high prices and favorable weather, leading to high supply in Europe.

Machinery, equipment, spare parts are damaged by euros

Source: INSTAT

"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 July, exports fell by 4.5%, while for the 7th month the contraction is 7.7%.

The deficit deepens

In this seven-month period, exports of goods reached the value of 233 billion ALL, decreasing by -14.5%, while imports of goods reached the value of 526 billion ALL, increasing by 3.2%, compared to a year ago. The trade deficit reached the value of 293 billion ALL, increasing by 23.6%, compared to the same period of 2023.

In July 2024, exports of goods reached the value of ALL 33 billion, decreasing by -12.0%, compared to the same period a year ago and by -4.1%, compared to June 2024. Imports of goods reached the value of 85 billion ALL, increasing by 21.1%, compared to a year ago and 11.5%, compared to June 2024. The trade deficit for this month is 52 billion ALL, increasing by 59, 6%, compared to July 2023 and 24.3%, compared to June 2024.

Exports with Italy and Spain decrease

In the month of July 2024, the countries with which Albania had the biggest decrease in exports, compared to July 2023, are: Italy (9.0%), Spain (53.4%), North Macedonia (8.7% ), etc. While the countries with which exports have had the greatest increase are: Kosovo (9.8%), Greece (0.3%), Germany (0.8%), etc.

Source: INSTAT

During this seven-month period, the countries with which Albania had the biggest decrease in exports, compared to a year ago, are: Italy (14.1%), Greece (21.6%), Germany (11.9%) , etc. While the countries with which exports have had the greatest growth are: Kosovo (0.1%), China (25.7%), etc.

In July 2024, the countries with which Albania had the largest increase in imports are: Italy (5.7%), China (29.6%), Turkey (19.9%), etc. While the countries with which imports have had the biggest decrease are: USA (5.2%), Spain (8.3%), Croatia (13.0%), etc.

During this seven-month period, the countries with which Albania had the largest increase in imports, compared to a year ago, are: Turkey (17.1%), Greece (19.3%), Germany (6.0% ), etc. While the countries with which imports have had the biggest decrease are: Italy (2.9%), China (3.7%), North Macedonia (9.4%), etc.

Trade exchanges with EU countries account for 56.9% of all trade. In July 2024, exports to EU countries account for 71.8% of total exports and imports from EU countries account for 51.1% of total imports. The main trading partners are: Italy (28.1%), China (9.2%), Greece (7.3%) and Turkey (6.3%).

Trade exchanges, for the first seven months of 2024, with EU countries account for 57.9% of all trade. In the period January - July 2024, exports to EU countries account for 71.5% of total exports and imports from EU countries account for 51.9% of total imports. The main trading partners are: Italy (28.6%), Turkey (8.2%), China (7.7%) and Greece (7.3%)./ Monitor.al