Carpatex cuts investments

Brasov-based fabric manufacturer Carpatex has announced a reduction in its investments due to the depreciation of the euro, a phenomenon which led to a 7% drop in production. Investment by the company has remained at a level of one million euros a year since 1995, when the company was privatised. This year”s investments have been cut back to 300,000 euros, which will be repeated next year as well. “At the moment we mainly need to invest in addressing our environmental issues, because this is the only way we will be able to cope on the market after EU accession,” said Maria Olaru, Carpatex”s financial manager. Representatives of the company announced first-half turnover of 3.7 million euros, down 5% on the same time in 2004. “The deregulation of the world textile trade immediately after January 1 of this year allowed China to monopolise the international market. For Romanian textile companies, this meant a reduction in the number of orders and, implicitly, a limitation of exports. Cheap Asian labour is attracting the major companies that outsource manufacturing like a magnet,” the Carpatex manager said, adding that this particular company had never done under contract work, despite exportng 70% of its output. ZF