In all of these European countries the share of production devoted to exports has risen,
with this increase being particularly strong for Spain and Portugal. In 1994, Spain
exported more than 80 per cent of total production, whilst at the beginning of the 1980s
only 20 per cent of production was exported. Italy has seen some variability in the
amount of production exported but was already a major exporter of footwear in the early
1970s. Nevertheless, a substantial proportion of Italian footwear output is exported.
Moving to the remaining countries, the common picture is one of a concurrent increase
in import penetration and export intensity.
To consider more carefully how the increase in import penetration may have affected
the nature of production of EU footwear we proceed to consider the geographical
composition of EU imports, and in particular, how the share of low-wage countries has
changed. Figure 3 illustrates the trend in the share of EU12 imports of total footwear
from the NICs (4 Asian tigers), RoA (rest of Asian countries), CEEE (Central Eastern
European Economies) and RoW (rest of the World trade). The data show a clear
increase in the penetration of imports from less-developed, low-wage regions in the
period after the mid-1980s, which coincides with the rapid increase in the volume of EU
imports of footwear identified in the figure above. This occurred firstly at the expense
of the OECD countries and has subsequently been associated with a decline in the share
of the NICs themselves. This reflects in part the relocation of activity in Asia away from
the NICs towards countries such as the Philippines and Thailand but, in particular,
China.
Until 1985, trade with OECD countries accounted for around 30 to 35 per cent of total
extra-EU12 imports. This share has subsequently been reduced considerably to less than
10 per cent. Such changes in the composition of imports may reflect, at least partially,
another aspect of the globalisation process whereby firms in OECD countries have
relocated their production to low-wage regions. Sales by OECD firms of finished
products in the EU market which are produced in low-wage locations overseas will be
recorded as imports from the developing country where production took place.