Italian footwear exports may drop in coming months: TexPro

19 May '21

3 min read

Pic: Shutterstock

Italy, one of the top exporters of footwear in the world, is likely to experience a drop in footwear exports in the next few months. The country exported footwear worth $12,458.23 million in 2019 at a monthly average of $1,038.19 million. It witnessed a significant drop in 2020 due to the pandemic, decreasing by 14.74 per cent to reach $10,621.51 million.

The footwear exports are expected to drop further by 3.71 per cent to $10,227.91 million in 2021, over the exports of 2020, according to Fibre2Fashion’s market analysis tool TexPro.

Close to 101 Italian footwear SMEs closed down in the first three quarters of 2020, resulting in 2,600 job losses. SMEs are the backbone of the Italian footwear industry and sell their goods abroad. Hence, they have been hit hard by the pandemic.

Along with component manufacturers, 231 companies in Italy have closed down and 3,453 employees have lost their jobs. The boom in online retail is also unable to recover the loss in sales of footwear in Italy. In addition to this, a drop in the tourist flows from abroad impacted the traffic and revenues for luxury segments.

The Italian government eased the pandemic restrictions on footwear manufacturing in the beginning of 2021 and split the country’s regions into three zones such as yellow, orange and red. There were restrictions on several aspects such as mobility and shopping but there were no hold-ups in the production chain and in the supply of raw materials.

The easing of the COVID-19 restrictions began on April 26, 2021 but the government of Italy has suspended physical trade fairs till July 1, 2021. These trade fairs play a significant role in promoting the business of SMEs in Italy, and reinstating them from July will be crucial to boost exports. The Italian government has allotted a grant of €400 million to support the trade fair industry. However, the funds will have to be approved by the National Parliament.

In March 2021, the US had announced that the next steps of Digital Services Tax investigations will take place against six trading partners including Italy. Approximately 25 per cent increase on ad valorem import duty on some upper leather footwear would certainly trigger costs for Italian brands’ stakeholders throughout the distribution chain. It would ultimately diminish the footwear exports of Italy to the US, which are more than 15 per cent of the total footwear exports of the country.

Fibre2Fashion News Desk (KD)

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