Annals of the University of Oradea: Fascicle of Textiles, Leatherwork (May 2017)
COMPARATIVE ADVANTAGE OF CLOTHING SECTOR IN THE EU-28 MARKET
Abstract
The study presented here is aimed at analyzing the comparative advantages in the European clothing sector with the focus on Balkan states. The dynamics of change over a 15‐year period following economic reforms are revealed. For all Balkan countries export plays an important role in promoting economic growth and development and the clothing industries play a significant role and continue to contribute to the economic prosperity in this countries. The evolution of the RCA index for garment industry is decreasing for all countries in the Balkans. The evolution of the Lafay index is also decreasing in the most Balkan countries (except Greece, Montenegro and Slovenia) but still the values for Lafay index is positive what indicating that in these countries the sale of garments contribute positively to balance the trade balance of countries analyzed. Negative value of the Lafay index may be due to the fact that the garment industry is one of the key industries in the economy of that country and also because the earnings from garment industry in these countries is high. When the producers of the Balkan countries will create products with higher added value in garment industry the competitiveness of these countries will decrease. Also rising wages in this industry, as a result of trade union pressure or government policy, will lead to decreasing competitiveness of these products on the EU market and implicitly to the decrease of exports of garments from these countries.
