Romania''s EU integration, threshold for textile industry

Maria Grapini, 51, has been running the Pasmatex business since 1995, when she took over the Timisoara-based textile plant from the state. She had been the manager of 13 Septembrie plant, the current Pasmatex, until it was privatised.

The company has devised a development plan for the next 5 years, to start with investments in a new plant.

Restructuring moves related to the hired personnel are also very important, says Grapini.

The company, which has about 700 employees, laid off around 160 people last year, with another 100 people to be made redundant by the end of 2007.

Pasmatex will invest around four million euros to relocate the plant it owns in Timisoara.

Grapini says she expects to raise as much as 15 million euros from the sale of the current plant, plus the associated land.

The plant is located right in the centre of Timisoara city.

The representatives of the company handling this move said they had already been contacted by around 10 companies interested in the acquisition and that the operation might be finalised in four to six months. The company produces Triumph lingerie, but also has its own brands, such as Dreambabe, Mary Style, Marion or Grappini.

“Year 2007 will be a threshold for our company, but not the only one. This will be the first threshold, in the wake of which we must adapt and assimilate European Union rules,” says Maria Grapini, chairman of Pasmatex managing board and the company”s majority stakeholder.

A significant part of the players in the textile industry consider EU integration will generate an outflow of labour force to other European states.

At the same time, amid the free circulation of freight, the domestic market is likely to be flooded by foreign products, a move that might generate losses for domestic producers or even bring them to bankruptcy.

“The problem will be more ”delicate” after 2007. It is then that we will see whether we can stand up to the conditions imposed by the EU,” says Grapini. According to her, Romania will enter the European Union with a handicap as regards work procedures, employee mentality, the level of investments, the living standard or the level of salaries.

“Romania will be much less prepared than Hungary, for instance, at the moment it enters the EU. There is a gap as regards the purchasing power and the level of salaries, too,” she explains.

The textile industry was last year seriously harmed by the flood of Chinese products, with some companies seeing their profit shrink several times or even getting into the red.

Moreover, foreign exchange rate fluctuations pushed several players to partially or entirely give up exports, for which contracts are calculated in euros, and focus on the domestic market instead. andreea.groenendijk@zf.ro