Italian clothing designers are being forced to buckle down as the country and the rest of Europe try to cope with the emergence of China as a fashion powerhouse, writes Daniela Petroff
Italian designers, used to living in the lap of luxury as the prime arbiters of international 0fashion, are tightening their belts as they face a challenge to their dominance mounted by a Chinese and Asian clothing industry bursting at the seams.
But the growth of Asia's economic strength may also be creating business opportunities. While Italian companies are faltering under the onslaught of Asian products, demand is rising in the East for the luxury end of the industry for which Italy is renowned.
"We have to think positive, and keep our eyes and ears open," says designer Miuccia Prada backstage after her menswear show for summer 2006 in Milan last month. The cheerful stars and hearts that decorated her shirts, bags and even shoes spoke of willful optimism.
On another Milan catwalk, perky young male models sported studded jeans worn so low that the flowered boxer shorts they revealed became an instant fashion item.
"We just have to do what we do best, even better," says Stefano Gabbana, creator of the new dropped waistline. The Dolce & Gabbana duo became a hot label in the 1990s, making underwear as outerwear their trademark look.
Like many of their Milan colleagues, Dolce and Gabbana have set up shop in China. They have two second-line D&G stores and a flagship store in Hong Kong and another store in Hangzhou, Zhejiang Province, on the Chinese mainland.
"For the leaders of Italian fashion, especially ready-to-wear, going to China accesses a new and very promising market," says Mario Boselli, president of the Italian Fashion Chamber.
However, he adds, small Italian companies are now feeling the brunt of the fast-growing Asian clothing industry.
Italian officials say China's decision earlier this month to revalue its currency may give them some breathing room.
The clothing and textile industry is one of Italy's leading assets. It is made up of some 68,000 businesses, mostly small and concentrated in the country's north and 60 percent of revenues within the sector come from exports.
However, the sector has been struggling in recent years, losing more than US$6.3 billion in turnover since 2001, according to Sistema Moda Italia. The downturn has led to the closing of some companies and the lay-off of some 90,000 workers.
Last may brought more bad news for the industry. According to Italy's national statistics office, production of clothing and textiles fell by 7 percent while shoe production dropped by 10 percent, confirming recent reports that footwear from China is treading at a rapid rate on what used to be a flagship of Italian style.
Italy's fashion industry also is being influenced by the flood of Chinese products into all of Europe.
European union figures showed an increase of 187 percent on "made-in-China" T-shirts in the first four months of this year. On the fabric end, imports of flax yarn increased by 58 percent in that period.
"Italian fashion is strong because its stylists draw on an outstanding offer of textiles," Boselli says, noting that a decrease in homespun fabrics could compromise the whole industry.
European producers gained some respite in June when the European Union and China agreed to stagger increases in Chinese textile exports over the next three years. However all limits are to be lifted in 2008.