Argentina’s struggling textile industry sank deeper into crisis last year as a sharp contraction in production and a surge in cheap imports battered local manufacturers, industry groups and analysts said, adding to concerns about the broader downturn in the country’s industrial sector.
The Argentine textile sector contracted by about 7.8 % in 2025, according to figures released by the Argentine Textile Industries Federation, marking one of the worst performances among major manufacturing segments and underscoring deepening structural challenges.
Factories are running at roughly one‑third of their installed capacity, a key gauge of industrial activity, and formal employment in the sector has been in steady decline since early 2024, with more than 19,000 jobs lost between December 2023 and November 2025, the federation reported.
Industry representatives blamed a sharp rise in imports of finished garments, many from low‑cost producers such as China, for squeezing domestic production. While imports of textile inputs such as yarns and fabrics fell in early 2026, shipments of finished clothes jumped around 129 % in volume and 91 % in value compared with January 2025, the federation said.
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“When industrial employment declines and, at the same time, imports of finished products increase under conditions inconsistent with the sector’s history and international production realities, the impact on domestic production is inevitable and worrying,” federation president Luis Tendlarz said in a statement.
The sector’s troubles come amid a broader slump in Argentine manufacturing. A recent consultancy analysis found Argentina recorded the second‑worst industrial decline globally over the past two years, with overall manufacturing shrinking nearly 8 % between 2023 and 2025, trailing only Hungary among 56 nations surveyed.
Industry advocates point to President Javier Milei’s trade liberalisation policies, including tariff reductions and loosened import restrictions, as exacerbating competitive pressures on local producers. Critics say the moves have flooded the market with inexpensive foreign goods and undermined domestic output, at a time when consumer demand remains weak.
The crisis has hit firms and workers across Argentina. In the textile belt of Buenos Aires province, dozens of factories have scaled back operations or closed entirely, prompting layoffs and stoking concerns among business owners and labour groups alike.
Milei’s administration has pushed broad economic reforms aimed at revitalising growth and curbing inflation, winning legislation to overhaul labour laws and loosen regulations. But many analysts say structural challenges, including shallow domestic demand and exposure to import competition, continue to weigh on key industries such as textiles.
