Industry in difficulty / Sales fell 16.6% in the third quarter, shoe and wood factories the most affected

2024-01-08 07:13:00, Ekonomi CNA

Industry in difficulty / Sales fell 16.6% in the third quarter, shoe and wood

The industrial sector has entered a long crisis cycle with a decline in production and sales, mainly due to the problems created by the fall of the euro combined with other factors such as the increase in production costs, the increase in the minimum wage and shortages in the labor force. .

Data from INSTAT generated from short-term statistics showed that sales in value in the industry sector recorded an annual decrease of 16.6% in the third quarter of 2023.

The largest decline was for the paper industry with 41% less sales in the third quarter of 2023 compared to the same period in 2022. In second place comes the shoe manufacturing industry, in which sales in value marked annual contraction of 35.3 percent in the third quarter of 2023.

In addition to the negative impact of the exchange rate, shoe factories were also affected by the drop in demand for shoes from the Italian market. The inflation crisis after the war in Ukraine affected household budgets, which in these cases reduced the demand for shoes. Fashion factories explain that when consumption is hit by crises, in the clothing group, the biggest drop in sales is for shoes and intimates.

Industry in difficulty / Sales fell 16.6% in the third quarter, shoe and wood

The industry of wood and its products faced a similar decline in sales. Although the construction and new housing sector has experienced growth, which would bring a higher demand for furniture, wood factories are in crisis. Representatives of the sector claim that the new apartments are not being furnished, causing the demand to deteriorate both within the country and abroad.

The extractive industry also suffered a decrease in sales value by about 33 percent in the reference period, mainly due to the drop in the prices of raw materials in the international markets and the negative effects created by the exchange rate.

Apart from sales, all other indicators in the industry have declined. Employment fell by 2% and the outlook remains dark for 2024 as well. This is the first time that industry representatives cannot provide forecasts for recovery.

Shifting the economy from production to import will bring long-term negative consequences to the country, says the Chairman of the Association of Exporters, Alban Zusi, who also operates in the agro-processing sector for export.

He says that the bankruptcy of the production units gives chain consequences from education, taxes, employment, destroys the supporting industries and destroys the 20 years of work that the country has done in creating "Made in Albania" products./ Monitor