This trend has been especially evident since 1988, as social security and labor taxes have risen sharply, forcing some companies out of the formal economy. Large garment companies have invested in this sector, since the factors influencing its outlook have become more positive. These larger companies have set a high priority on modernization, productivity enhancement, and product line expansion to attract new buyers. Mergers and alliances have become common denominators among these companies. Big shipments of synthetic fabric and low cost garment imports have arrived from China, Hong Kong, South Korea, and Taiwan since 1994.
Sources claim that garment imports have caused the greatest damage to the textile industry.
The problems facing Brazil's textile sector have influenced domestic production of textile fibers. Recently, producers have not maintained the 1.1 - 1.2 million metric ton levels evident in the eighties and early nineties. Total domestic production of textile fiber decreased almost 25 percent from 1991 to 1993 - the lowest production level in the last fifteen years. Domestic cotton production maintained a similar trend, while the production of artificial and synthetic fibers has been growing in relative importance. Artificial and synthetic fibers constituted almost 40 percent of total domestic production in 1995, while their share was close to 30 percent in 1991.