Production costs for textiles increase due to higher utility prices

Gheorghe Caescu, General Manager of Iasitex, one of the main players on the domestic textile market, said that prices are somewhat stable in Asia, and it will become harder to compete with their products. Caescu believes that investments must be made in technology to decrease costs.

Maria Grapini, General Manager of Pasmatex Timisoara, feels that small and medium-sized companies (SME) will be the most affected by this new cost increase. Some 99 percent of European Union companies are SMEs, while in Romania SMEs make up 95 percent of total companies. According to Grapini, the ratio of utilities in costs is some 4.5 percent.

The work force shortage has led companies to move to other countries for subcontractors. The Romanian textile market is expected to decrease by 10 percent this year. Of the 830,000 textile industry workers in 1990, only 390,000 are still active, with some 20,000 available jobs vacant.