Germany fears a new wave of bankruptcies in the light industry
The German trade association for textiles, footwear and leather goods (BTE) said the repayment of debt related to government support for businesses during the pandemic is now putting additional pressure on the struggling industry, writes Worldfootwear.com.
BTE estimates that sales at the end of September are on average higher than 2022 sales, but still below pre-pandemic levels.
Adjusted for inflation, sales losses compared to 2019 are in the double-digit range. The association is therefore "convinced that the sales of many textile and footwear stores are not enough to offset high cost increases, for example in the areas of energy, personnel or rent."
As the deadline for repayment of debts on government aid received by businesses in connection with the pandemic approaches, BTE fears a new wave of bankruptcies. The assistance includes loans from the Credit Institute for Reconstruction (KfW), a state development bank jointly owned by the German federal government and the country's regional governments, as well as bridging assistance (ÜBH) intended to compensate for the sharp drop in sales due to lockdowns in 2020 and 2021 .
The German association calls on “political decision-makers to provide clear, fair and understandable solutions to controversial aid issues,” given that fashion, footwear and leather goods businesses “have been by far the biggest victims” of government measures introduced during the period COVID-19 pandemic.
The German trade association for textiles, footwear and leather goods (BTE) said that the repayment of debts associated with government support for enterprises during the pandemic is now having...
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