THE Association of Small to Medium-sized businesses in the Balearic Islands, Pimeco, gave a warning yesterday that the downturn in business experienced in 2008 and which is ongoing, is threatening the very survival of the industry.

A spokesman for the association said that National Institute of Statistics (INE)figures had confirmed that retail trade fell by 5.9 percent in the region during 2008, a drop which was greater than the national average of 5.6 percent. The same report confirmed that in December last year alone, business plummeted by 5.8 percent in relation to the same period the previous year.

The spokesman furthered that the major year-on-year decrease experienced in December “rubbed salt into the wounds” of the poor trade that retailers had reported since August the same year. “Since that time,” he said “we are 100 million euros of takings worse off.” The credit crunch has badly affected the retail sector, in spite of efforts which the industry has made to modernise its management and improve stock levels. Pressure is also brought to bear by large commercial organisations and by changes in the way wholesale goods are distributed. Pimeco warned the situation will worsen this year.