Page 62 - New Cloth Market November 2022 Digital Edition

INTERNATIONAL BUSINESS PAGES

The COVID-19 pandemic affected the la's exports and they registered a sig- the investments made in these Free
industry. Two companies in the indus- nificant decrease of 9.6% for chapter Trade Zones, which were estimated to
try closed and 2,000 jobs were lost. 61 and 38.6% for chapter 62. be between 300 to 400 million USD in
Some companies were able to adapt 2019.
There are two textile companies that
and change their production to focus
are established in Free Trade Zones, The textile and apparel industry pro-
on uniforms and personal protective
both of them foreign (Cone Denim-US jected a 7% growth for 2021, after the
equipment in order to meet the demand
and Alpha Textil-Taiwan). Their produc- impacts of the COVID- 19 pandemic
from the US. The strategy employed
tion is used for self-consumption and and the Eta-Iota hurricanes, which af-
by the marketers was to maintain zero
commercialization. The establishment fected the figures for 2020. This growth
inventory and place orders with suppli-
of Cone-Denim encouraged cotton pro- was projected by companies under the
ers in accordance with demand.
duction in the country, until the com- Free Trade Zone regime. According to
According to ANITEC data, it is expect- pany suspended operations indefinite- ANITEC, the companies expect the
ed that 500 jobs will be recovered with ly in 2009. The plant that was closed sector to continue recovering to pre-
the operation of a new knitting textile down had been opened a year earlier pandemic export levels and to safe-
plant, in addition to the investment of at an investment of US$100 million. guard their commercial relationship
a new plant in Chinandega, which is The company claimed that the shut- with their main export destination: the
expected to hire 2,000 workers within down was due to a drop in sales and US.
two years (in 2023 according to pro- requested the Nicaraguan authorities
jections). to sanction its closure for a period of Haiti
14 months. The action resulted in the The textile industry has played a sig-
Comparative Data Nicaragua – Gua-
dismissal of 850 workers. nificant role in employment generation
temala
and the industrial development of the
According to World Bank data, Nicara- The suspension lasted more than 14 country. According to the Association
gua's exports amounted to US$6 bil- months. Conen-Denim reopened the des Industries d'Haiti (ADIH in French),
lion, while Guatemala's exports factory in early 2014 with an invest- 59,060 jobs in the apparel and textile
amounted to US$11.6 billion, twice ment of 35 million USD and under the manufacturing have been reported for
those of Nicaragua's. Furthermore, name Pride Denim Mills, after Grupo the year 2021. 35% of industrial asso-
Guatemala's economic indicators are Karim’s of Honduras acquired it. To re- ciations are in the apparel and textile
more favorable; in the year 2020, its sume production, 600 employees were sector. In 2020, exports from this in-
GDP will be approximately 500% high- hired with a goal of producing 28 mil- dustry accounted for 80% of the coun-
er than that of Nicaragua. lion yards of denim fabric per year. try's total exports. The socio-econom-
Grupo Karim's has operations in Mex-
Foreign direct investment income for ic context of Haiti shows indicators that
ico, Guatemala, El Salvador, the Do-
Guatemala amounted to US$853 mil- place it below many countries in the
minican Republic, the US, and Nicara-
lion in 2020, as compared to US$182.3 region, with a high impact caused by
gua. Pride Denim Mills is still operat-
million for Nicaragua. Guatemala's poverty and unemployment. In this
ing in Nicaragua, according to Panjiva
GDP per capita grew by 61.38% in context, this industry, and its capacity
2022 records.
2020, while Nicaragua's growth was to generate employment takes on spe-
26.69%. The difference in this indica- The apparel and textile sector in Nica- cial relevance for the country.
tor between the two countries is sig- ragua has been impacted by the coun-
nificant, with Guatemala's GDP per try's economic and political situation, Comparative Data Haiti - Guatemala
capita amounting to US$4,603.3 and which has forced the closure of small According to World Bank data, Haiti's
Nicaragua's to US$1,905.2. and medium-sized companies in the exports amounted to US$1.0 billion,
sector.
Nicaragua's exports of articles of ap- and Guatemala's exports amounted to
parel (Chapter 61 and 62) account for According to the Cámara de Industri- US$11.6 billion. We can see that, com-
approximately 26.1% and textiles for as de Nicaragua (Chamber of Indus- pared to Haiti, Guatemala's exports are
0.26% of the country's total exports, tries of Nicaragua–CADIN in Spanish– significantly higher. On the other hand,
according to 2020 data. The main des- 2019),”...30% of the small and medi- Guatemala's economic indicators are
tination markets for chapters 61 and um textile firms in the apparel textile more favorable, its GDP was five times
62 are the US, with a share of over industry that are still in operation, are higher than Haiti's in 2020, and Haiti's
90%, followed by Canada and Mexico. producing at 25% of their capacity.” foreign direct investment income is the
Nicaragua's exports under Chapter 61 They state that there is a better out- lowest in the region. Guatemala's GDP
in 2020 registered a decrease of look for the companies in the sector per capita experienced a growth of
19.7%, while the decline in exports that operate in Free Trade Zones in the 61.38% in 2020, compared to 2010 and
under Chapter 62 was 27.6%. Likewise, country and acknowledge that one of amounted to US$4,603.34, while Hai-
the pandemic also affected Guatema- the drivers of growth in the sector are ti's growth in the same period was

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