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Fast-Fashion Brands Could Stop Producing in Turkey

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Inditex Zara

Russia recently banned trade imports of Turkish goods as retaliation for the downing of a Su-24 warplane near the Syrian border in November and now some European retailers are considering shifting their manufacturing from Turkey.

According to Turkish TV station T24, Zara, Mango and H&M may move their production activities to other countries because of concerns that clothing carrying a “Made in Turkey” tag will be rejected by Russian customs officers.

The fast-fashion brands reportedly requested that their Turkish suppliers also remove all country-of-origin evidence of labels from their apparel.

Revenue in Russia, which until recent years had made up only a minor part of these chains’ global businesses, appears to be on the up. Inditex-owned Zara, which entered Russia in 2003, now has 450 stores in the market (compared with around 60 in the U.S.).

H&M, meanwhile, said in September that its year-on-year sales in Russia had risen 15 percent over the first nine months of the year (or a 56 percent increase in ruble terms) and that it had opened 15 new stores during that period.

However, H&M also employs hundreds of manufacturing, processing and fabric and yarn facilities in Turkey. Additionally, more than 30 Turkish brands operate around 7,000 locations in Russia, Today’s Zaman reported, most of which are clothing stores.

Federal Customs Statistics show that Russia imported $3.1 billion worth of goods from Turkey in the first nine months of the year. This is the second time in as many years that Russia has banned the import of a range of goods from a major trade partner. In 2014, the country sanctioned food imports from the E.U., the U.S. and Canada.

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