Textile Exports in Nicaragua Export Processing Zone Will Continue to Grow by 10%

Because Nicaragua has abundant labor and low wages, policing is relatively good compared to other Central American countries. The Nicaraguan government also adopts an incentive policy for foreign investment. Nicaragua's main manufacturing industries are food, beverages, non-metal products, oil refining, chemicals, wood, textiles, garments, etc. The main manufacturing industries are mostly concentrated in processing export zones.

Nicaragua has obtained the permission granted by the WTO to develop national standards on a low basis, so it still maintains the conditions of the original incentive foreign investment and processing export zones.

According to the World Trade Organization (WTO) on January 1, 2003, only countries with national income of less than US$ 1,000 can provide preferential tax concessions for foreign investors, Nicaragua is also one of them;

The Fourth WTO Ministerial Meeting of the Doha Ministers based on special and differential treatment provisions for low-level development countries also allowed Nicaragua to maintain the existence of export processing zones after 2008, while other neighboring countries with higher incomes in Central America must Modifying the export processing area ordinance and conducting transformation so as to avoid export subsidies will help Nicaragua continue to attract foreign investment.

The Nicaraguan government's incentives to invest in the development of industrial zones include favorable conditions for income tax relief, tax-free imports of raw materials, machinery, equipment, spare parts, vehicles, samples, molds, and accessories, transfer of real estate, capital gains, tax exemptions, and establishment and transfer of company tax exemptions. Exemption from direct taxes, consumption taxes and local taxes, export tax-free.

The Nicaraguan Export Processing Zone was initially established. There are only a few Taiwanese companies manufacturing garments in the region. As a result of President Chamorro’s promulgation of an executive order to facilitate foreign investment in November 1991, Taiwanese companies have invested in the Nigerian Processing Zone. . With the recovery of the international economy, manufacturers in the processing zones have shown signs of returning and expanding factories.

Since 2010, Istmo Textil en Masaya, the Brazilian shoe manufacturer, has been mass-produced in Nicaragua, and Demotech's production of medical sutures has shown signs of recovery in Nicaragua's processing zone manufacturing industry. In 2010, the Processing Zone employs 89,927 people, surpassing the record of the total employed staff of 88,629 in January 2008.

According to the report of the Nicaraguan Textile and Apparel Industry Association, the total value of textile exports from processing areas in Nicaragua in 2010 surpassed the high of US$ 934 million in 2008, setting a new record, reaching US$ 1,108 million; Exports grew by 14% annually.

According to the export volume analysis, exports of 362 million square meters of textiles in 2010 were 17.7% higher than in 2009. Major export items include cotton tops, jackets, overcoats, shirts and trousers.

As the global market demand has picked up slightly, some Nicaraguan processing area textile manufacturers have expanded their production scale and increased their number of employees by 3,000. It is estimated that in 2011, the textile industry in the Processing Zone will maintain a sustainable growth of 10% to reach US$1.1 billion, and the number of employees will increase from the current 65,000 to 70,000.