Italy's textile industry is widely regarded as the most important in Europe. Yet even with export sales topping US$12 billion a year, the Italian industry is no longer in the unassailable position it once enjoyed writes Sonia Roberts.

Regularly attendees of European, or indeed Asiatic, textile trade fairs cannot fail to appreciate the contribution made by Italian weavers and knitters. For whatever the venue it is usual for Italian exhibitors to outnumber others often on a two-to-one basis.

Nor is it only in terms of numbers that the Italians stand out from the crowd. Often it is their collections, which on the basis of design and experimental construction techniques, point the new directions in which the global textile industry must travel.

Little wonder therefore that in official documents, such as the brochure recently distributed to potential textile trade customers by the Italian Institute for Foreign Trade, the Italians unhesitatingly describe their textile industry as "the most important in Europe." This is backed with the fact that a quarter of all textiles and textile products made within the EU now emanate from Italy.

Yet even with export sales topping US$12 billion a year, the Italian industry is no longer in the unassailable position it once enjoyed.

Taking the global view, and working on figures issued by the World Trade Organisation, since 2002 Italy has ranked only third in the exporting league - behind, respectively, China and Hong Kong.

Perhaps even more worrying for Italian producers is the fact that it is not just in volume textiles for the mass production clothing industry that China appears to be forging ahead as potentially the world's major source of textiles.

Sales erosion
The current picture is of a gradual erosion of sales into those sectors where the Italians once reined supreme - such as the high quality, wool-based men's suiting fabrics for which the Prato and Biella are celebrated.

For instance, during the first six months of the current year, for the first time ever Japanese tailors and clothiers bought more worsteds from China than from Italy.

Italian suppliers might take comfort from the fact that during this period they sold substantially more worsteds to the Japanese than in the equivalent period of 2003. But at a time of rising demand for imported worsteds from all sources, the Italian upturn was a mere 8 per cent as against the massive 58 per cent achieved by the Chinese.

These figures, however, still put the Italians way ahead of the British. During the same period, sales of British-made worsteds into the Japanese market dipped by 7 per cent, with no immediate signs of a recovery of demand for UK-made cloth.

The Italian textile industry, of course, does not live by woollen and worsted sales alone. Italian producers are equally active in the field of fine silks, a sector where the Italian flair for tapping into the latest fashion trends has stood them in good stead against price competition from the Far East.

Moreover, bodies like the Como-based Silk Manufacturers Union, with its support of the Experimental Silk Centre, also continue to push their members to be more adventurous in the way they handle the basic raw materials.

Italian silk collections for winter 2005/6 for instance are, in the words of the SMU, "chromatically richer than ever before."

Moving with the times
Cotton specialists are also seeking to move with the times, introducing new finishes and blends with manmade fibres for 2lst century easy-care.

Earlier this year at Italy's Moda In textile event, cotton blends with hemp to create a linen-like slub surface without linen's propensity for creasing were an innovation attracting the attention of international buyers.

These new approaches to the way that cottons are conceived already seem to have secured the immediate future of Italian cotton producers' sales to their French neighbours.

France remains a key customer for all Italian fabric producers, spending in excess of €1.3 billion last year and keeping the Italians ahead of their rivals - perhaps most importantly both China and Germany - in the amount of cloth they sell to the French.

In the case of Germany, however, inter-EU sales constitute a two-way traffic. Thirteen per cent of all non-home produced textiles absorbed by the Italian clothing industry derive from Germany.

Within the EU though there is fierce competition between the French and the Germans to secure Italian business. During the first three months of the current year French textile manufacturers sold €246 million worth of cloth to Italian customers.

They were however barely holding their own in a market acknowledged to be "difficult." French exports to Italy were two per cent less than in the first quarter of 2003, a year when the total value of sales of Italian textile and textile products into France topped €2.50 billion.

Obviously in any assessment of inter-EU sales, as well EU members' sales to the wider world, the comparative strength of the euro against other currencies has to be taken into account. And throughout 2002 and 2003 the strength of the euro weighed heavily on the Italian economy. After having risen by 1.7 per cent during 2001, it increased only by 0.4 per cent during the next two years, while in 2003 the inflation rate rose by 2.7 per cent.

During this time Italian fabric producers were also hit by a lack of confidence within the home market. This curtailed general household spending, and unusually for fashion and style conscious Italy, also produced a cutback in the level of personal spending on clothes and fashion accessories.

Inevitably this situation was reflected in a 2003 cut-back in textile production of some 3.3 per cent throughout all sectors of the industry. Once again, however, Italian producers were not alone in facing these difficulties. During 2003 textile production across the EU also dropped by 3.3 per cent.

Prospects for 2004?
So what of prospects for 2004? Obviously Italian textile producers will not be content to suffer decline alongside their EU neighbours. They have always considered themselves to be a race apart, and the energy and enthusiasm with which they set out their stall at each of the world's major textile trade events suggest they will continue to fight their corner with vigour.

Recent changes in tariff and quota systems have however served to tilt the global market even more in favour of the Chinese. These producers already have the advantage of lower wage structures and are fast catching up with any technical advances in plant and equipment which previously kept the West ahead of the rest of the world.

But if, as seems the likely scenario, the next decade sees the virtual elimination of textile production within Western Europe, it also seems likely that the last EU nation to be erased will be Italy.

By Sonia Roberts.