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How 'Made in Portugal' is expanding its footprint on global stage

By Isa Soares, CNN
updated 1:36 PM EDT, Fri April 12, 2013
STORY HIGHLIGHTS
  • Despite economic gloom, one Portuguese industry is expanding its export market
  • Shoemaking, one of country's most traditional industries, is mapping out a new future
  • Some are discovering new ways to gain traction, such as adopting Anglo-Saxon names
  • It's a strategy proving its value, with exports in the industry growing 6% a year

Editor's note: Isa Soares is a Marketplace Europe reporter. Follow her on Twitter.

(CNN) -- To better understand Portugal's economic challenges look no further than Guimaraes; its oldest city and the cradle of my nation.

In the 1980s and 1990s, this city was an industry boom town with factories lining the valley. Today many of these are gathering dust while others rust, as the economic crisis and competition from China take their toll.

But despite the doom and gloom, there is one Portuguese industry that's making great strides.

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Shoemaking, one of the most traditional and oldest industries in the country, is mapping out a new future by exporting its way out of the crisis.

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And some are discovering new ways to gain traction overseas.

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We visit a shoemaker where, on one of the factory floors, workers stitch, sew, glue and lace up the company's product. The shoes range from the practical and functional, to outright edgy.

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Stamped on the side of each shoe is a sketch of a fly. This is the company's logo, and its brand name is Fly London. It's entirely "Made in Portugal" -- but distinctively un-Portuguese.

Others such as Nobrand, Camport, Eject, Mack James, and Softwaves have also chosen to have an Anglo-Saxon ring to them, so they can stand out in the very competitive market.

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Alfredo Moreira, the executive director of the Portuguese Footwear and Manufacturers Association, tells me the decision to use Anglo-Saxon names fits perfectly with today's open and globalized economy. He told me "competition is tough," adding, "companies have to think in a very globalized way."

It's a strategy that has helped drive growth, with 97% of output now going to about 130 countries.

To better understand their export market, I visit Fly London's new warehouse. I find boxes upon boxes of Fly London shoes, ready for delivery to Croatia, Denmark, Italy, UK, U.S., Russia and Angola, among many other countries.

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But Fortunato Frederico, managing director of Fly London, tells me selling abroad requires more than just a foreign name. It requires investment in new and advanced technologies, better quality products, spending on international promotion and updated workforce skills.

During my tour of Fly London's factory, Frederico tells me they're installing new technology which will make the ordering process smoother and faster.

Portuguese shoes are now the second most expensive in the world, behind Italian shoes, according to industry group APPICAPS. Marketing drives and innovation has helped grow the industry's exports by 6% every year for the past five years.

For the Portuguese government, which has been pinning its hopes on traditional sectors such as this one, the industry offers a glimmer of hope for a country trying to get out of its debt quagmire.

And with the Portuguese economy expected to shrink by 2.3% this year, industries like this are more than just examples of innovation -- they are the glue holding a fragmented economy together.

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