Several groups in the textile and clothing sector in Portugal have announced the closure of production units and the dismissal of hundreds of employees. The associations that represent them are calling for emergency measures, such as layoffs and revitalization plans, so that companies can be genuinely restructured and both manufacturers and workers can be saved.

Companies in difficulty have been multiplying across Portugal for several weeks, with some trying to resume operations through revitalization plans and debt restructuring. However, many others have not reopened since the summer break.

According to Ana Dinis, director general of the Textile and Clothing Association of Portugal (ATP): “To deal with this crisis, the government and the European Union must adopt swift and concrete measures: a simplified layoff to help manage the workforce in periods of falling demand, instruments to support cash flow, and more flexible measures for companies to adjust,” she told ECO.

The expert, who holds a degree in International Relations and International Trade and has worked in the Portuguese textile and clothing industry since 2004, adds that, “firm measures against unfair competition are needed, such as an end to de minimis regimes, the application of specific taxes to ultra-fast fashion, and greater supervision within the European internal market.”

In the opinion of César Araújo, founder and CEO of Calvelex and president of the National Association of the Clothing and Apparel Industries (ANIVEC): “Companies need to restructure. And that’s only possible with the PER,” he told ECO, stressing that, “there has to be a simplified layoff for companies to get orders.”

“This situation can be solved with three measures: long-term debt, restructuring mechanisms with social security, and simplified layoffs,” he added.

“Europe has squandered its market, opened its doors, and we are witnessing the biggest tax fraud of the 21st century. There are more than 100 billion euros without customs control — it’s the biggest tax evasion.”

According to an activity survey for the first half of 2025, carried out by ATP in June, exports from the textile and clothing sector totaled €2.79 billion between January and June 2025 — a drop of 1.3% compared to the same period in 2024, which had already seen a 3.9% decline compared to 2023.

The latest survey reveals that 66% of companies reported a decline in turnover, and 67% recorded a drop in production in the first half of the year, with 65% anticipating a further decline in turnover in the second half.

Nevertheless, in Ana Dinis’ view, the Portuguese sector continues to maintain its capacity for innovation, differentiation, and internationalization.