Israeli fashion industry could collapse from pandemic losses

Shopkeepers warn that if the government does not take serious steps to save them from the coronavirus-induced crisis, the whole national fashion industry could go down.

al-monitor Mannequins are seen at the entrance to a clothing store, Jaffa, Tel Aviv, Israel, Oct. 09, 2013. in Jaffa, a suburb of Tel Aviv, Israel. Photo by Lior Mizrahi/Getty Images.

Nov 11, 2020

Shopkeepers across Israel were happy on Nov. 8. After several weeks of waiting, the government eased coronavirus restrictions, enabling them to reopen. Still, the government decided that stores could let in up to only four customers at a time. As a result, people queued for many hours waiting to enter shops.

The first ones to benefit from the easing of restrictions were the big international fashion chains, but the smaller shops were also delighted. Shops selling Israeli-made fashion items were hit hard by the coronavirus-induced crisis. In fact, already before this last crisis, Israel's fashion industry was struggling. Many of the fashion entrepreneurs warn now that the whole industry could drown.

Nitzan Meir is an independent entrepreneur who sells Israeli fashion accessories. He has also been involved for several years with the Movement to Encourage Israeli Fashion. Right now, he is selling hand-made original face masks.

Israeli fashion manufacturers and merchants have engaged in the battle since 2015, when two laws were introduced. "The first one was the cancellation of the value-added tax for online purchases under $75 for all non-Israeli shopping sites. The second legislation scraped up protection taxes on textile products imported from China. These two laws created an absurd situation, where the Israeli government gave preference to Chinese producers over Israeli fashion designers who were working with Palestinian tailor shops," Meir told Al-Monitor.

Israeli fashion designers and shopkeepers got even angrier after the first coronavirus lockdown in March. "The Movement to Encourage Israeli Fashion was astonished to learn about Prime Minister Benjamin Netanyahu’s decision to offer the big fashion chains bonuses of 6 billion shekels [$1.8 billion] over the closure of shopping malls. Needless to say that the government did not consider it important to include Israeli fashion producers, designers, creators and all the small fashion and clothing shops in this bonus program," the organization tweeted April 27.

Meir explained that the pandemic-induced economic crisis increased the difficulties that the fashion industry has been facing for years. The second wave of the pandemic, with the second lockdown, only made things worse. "After the second lockdown, the government decided to reopen schools, synagogues, the aviation industry and food chains, but not street shops. And so, we were forced to increase our campaign efforts. It was a hard blow for Israeli-made fashion, which is usually sold in such shops in town centers," he added.

The campaign, according to Meir, was a desperate one, with thousands of shopkeepers taking to the streets of Tel Aviv, burning tires and setting on fire their own merchandise. Shopkeepers carried signs blaming the government for enabling supermarket chains to sell clothes, shoes and toys, while the small shops were ordered to keep their doors shut. People were crying. When that happened, the media paid attention, and so did Netanyahu. The prime minister then decided to reopen the shops partially, even though the Health Ministry was against that.

With all these obstacles, some of the Israeli fashion designers simply gave up on shops. And so, entrepreneur Tal Brown came up with the idea of creating a central platform for Israeli fashion designers to sell their creations online.

"We started developing MOXIE during the first coronavirus outbreak, when many Israeli brands, designers and artists found themselves cut off from their customers, unable to expose their production. In the past few months, several designers were forced to close their studios for long periods. Often their studios or their shops were their only platform for selling. As of Nov. 8, street shops are allowed to accept customers, but still under heavy restrictions," Brown told Al-Monitor.

She explained that while each designer can launch an online shopping site, the multitude of shopping options makes success difficult. "The sum of uniting talented designers from different categories under one roof is so much bigger than the addition of all these components. Everyone gains here. Everyone benefits from working together. The customers can focus on one site only, and that’s the principle we are based on. In fact, the mass of clients each designer brings along helps reinforce the exposure of the other designers," she added.

While this solution obviously does not resolve the problem of the street shops, Israeli fashion designers hope that it will generate greater public awareness and desire to buy Israeli-made fashion items.

"Street shops are the heart of urban life. While the world is going online, people should not forget that without us city centers will be dead. It is in the urban space that people meet; it is there that art and creation develop. When people came out of the lockdown, all they wanted was to walk the streets again, sit in the parks again, have a coffee at a cafe terrace again and shop again around the corner. Encouraging local production is not only a question of ethics or sustainability, it is a question of the way we chose to live," Tel Aviv shopkeeper Danny told Al-Monitor.

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