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Albanian tailor sells to Harrods

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Harrods sells Mr Xibri's shirts.

Leading shops sell Intertex fashions

(The following article is reprinted with permission from BBC News at bbcnews.com, detailing how micro-credits from ProCredit Bank Albania, an institution founded and supported by the EBRD, helped launch an Albanian tailor into the international big league.)

By Kieran Cooke
Tirana, Albania

When Arben Xibri was a young, trainee tailor, he sewed suits for the top leadership of Albania's Communist Party.

Now Mr Xibri is running his own textile business, making shirts for some of the leading Italian and British brand names and selling his goods to leading European department stores, including Harrods in London.

"I am very proud to be able to put a "Made in Albania" label on my shirts" says Mr Xibri.

"The leading fashion houses recognize that clothes made here are high quality. It's a big, big change from the old days. In communist times the only people who were allowed to wear smart shirts and suits were the party leaders."

Mr Xibri employs 100 young women at his Intertex company factory in a suburb of Tirana known as the Old Refrigerator District.

It was an area of state warehouses in the communist era, but is now a bustling, if rather run down, industrial estate.

"We produce about 5,000 shirts a week" says Mr Xibri.

"From an early age all Albanian girls learn to sew. They are very skilled. Like other countries in Europe we are facing stiff competition from China but so far we are ahead on quality and can compete on price. Also we are able to deliver our goods to shops in Rome or London in a matter of days. Shirts from China take six weeks to reach the marketplace."

Long road

For Mr Xibri it has been a long, tough road from apprentice tailor under the communists - a regime which kept Albania virtually cut off from much of the outside world for more than 40 years - to factory owner.

When the communist leadership was swept from office 1991 Mr Xibri, like hundreds of thousands of his fellow Albanians, escaped abroad, working at a clothing factory in Vincenza in Italy.

He won a EU fabric design competition and used the prize money to send himself to one of Italy's top textile institutes.

In 1994 Mr Xibri returned to Albania: together with an Italian partner he invested in a small factory premises, using savings of $15,000 to buy second-hand German and Italian textile machinery.

"The business grew quickly. At first we were making T-shirts and low cost goods but three years ago I bought new machinery, including special washing machines for processing the shirts, and we have moved upmarket."

Problems for business

There are still considerable problems operating a business in Albania.

Banks are generally conservative and unwilling to lend to relatively small, young enterprises like Mr Xibri's.

ProCredit Bank, an international bank which specialises in small loans to businesses in developing countries, lent him 16,000 euros (£10,000). (The EBRD is a founder and shareholder of ProCredit Bank.)

Because textiles is seen as a cyclical, high risk business and due to ongoing political uncertainties in Albania, interest rates are high.

Mr Xibri's loan is for 24 months - at an annual interest rate of 24 per cent.

Besides high interest rates, small businesses face other difficulties.

Much of Albania's infrastructure is in a dilapidated state. There are frequent power blackouts.

Under communism, there was no such thing as private property. Businesses face ongoing problems over ownership of premises.

Also, while Mr Xibri has a skilled workforce, his factory is essentially an assembly operation. All materials for the shirts, from the cotton to thread to buttons, has to be imported.

"Albania scores high on quality" says a buyer for one of Italy's leading brand names.

"Its textile workshops are also flexible, able to make up small orders to meet the demands of an increasingly fussy buying public. China can compete on cost but it deals more in bulk.

"What Albania doesn't have is any textile manufacturing capability. For Italy it's a low-cost assembly area. That might be good for us but in the long term Albania needs to build up its own industry if it's going to climb the economic ladder."

Industrial future

At present, there is little industrial development.

Most factories date from the communist era and many have been abandoned.

Widespread corruption, an absence of the rule of law and a bewildering array of business taxes deter all but the most adventurous investors.

"We emerged from the communist era so far behind," says Ardian Fullani, the Governor of Albania's central bank.

"Things are changing but it takes time. Creating hope and confidence in the future is the most vital task. But Albanians are very resourceful and they are used to fighting their way through difficulties."

Despite all the problems of running his business, Mr Xibri has no regrets about returning from Italy.

Though he won't disclose any figures, he says he is making money, and he's optimistic.

"We have very good designers and textile specialists in Albania. My aim is to focus on quality and style. Before too long I want to establish my own special brand to compete with the big Italian, French and British names.

"More and more people will realize that the 'Made in Albania' label is a mark of excellence."

1 August 2005