Skip to content Skip to Search
Skip navigation

Textile companies in Turkey move to Egypt to compete

Turkey textiles Female workers working in a textile factory Alamy/Reuters
Employment in the textiles sector in Turkey has dropped below one million for the first time since the height of the Covid pandemic
  • Industry feels pressure from abroad
  • More than 65,000 jobs lost
  • Ready-to-wear exports down 7%

Producers in Turkey’s once vibrant textiles industry are looking at moving to Egypt and elsewhere to stay afloat in the face of rising costs and fierce international competition.

Company closures and job losses mean employment in the textiles sector has dropped below one million for the first time since the height of the Covid pandemic, data issued by the state social security agency this month showed.

The sector shed 65,000 jobs last year, 80 percent in the apparel segment and the balance in associated raw materials and processing components.

More than 2,000 textile companies, mainly in apparel and ready-to-wear, shut up shop last year, taking total job losses in the sector since 2022 to 250,000. 

“A key factor in textile production decline is the lack of orders from its main EU markets,” Asalettin Arslanoğlu, the Istanbul representative for the DISK labour organisation who specialises in the textile industry, told AGBI. “It is losing its markets as the sector is struggling with high local input costs.”

Cheaper goods from China and other competing Asian nations are also taking away market share. Turkey’s ready-to-wear exports fell 7 percent last year to $18 billion. Exports of leather goods were down 18 percent to $1.5 billion and raw material fell below $10 billion. 

To compete, many Turkish textile firms are moving their operations off-shore, relocating production in countries with lower labour, materials and other input costs, with Egypt as the preferred option. Tunisia is also lobbying hard to attract Turkish investment.

In February, Turkey’s Eroğlu Holding, at one time the owner of the clothing brand Mexx, signed an agreement to set up a $120 million yarn-to-garment factory in Egypt’s Qantara West Industrial Zone, one of the free trade zones established by Cairo to attract foreign direct investment. 

Eroğlu joins more than 200 Turkish textile companies that now have a production presence in Egypt, in part attracted by the lower wages paid to local workers, as well as cheaper cotton and services.

Business closures and a shift offshore are having a wider impact on Turkey, Arslanoğlu said, from farmers growing cotton and small workshops to the top-end fashion products, putting one of the country’s few end-to-end sectors at risk.

Turkey was the world’s sixth biggest cotton producer in 2023. 

“It is one of the rare industries where all elements of production are domestic, from the growing of the raw material to the production of yarn, weaving through to ready-to-wear, spreading its gains across different economic income levels throughout Turkey,” Arslanoğlu said.

Register now: It’s easy and free

AGBI registered members can access even more of our unique analysis and perspective on business and economics in the Middle East.

Why sign uP

  • Exclusive weekly email from our editor-in-chief
  • Personalised weekly emails for your preferred industry sectors
  • Read and download our insight packed white papers
  • Access to our mobile app
  • Prioritised access to live events

I’ll register later