Business nervous over closing of Nicaragua's maquilas

An announcement about the closing of various plants of the international consortium Nieng Hsing has raised anxieties in Nicaragua's business community about the future of the free trade zone and its 14,000 workers.

Friday, June 27, 2008

Nieng Hsing, which has operated in Nicragua since the 1990s, has already closed five of its plants. The remaining one, Shao Hsing, employs about 3,200 persons. The 1,500 employees dismissed from the other companies have found other work in the zone.
Last year, six other companies ceased operations in the free trade zone, throwing 2,325 employees out of work. Five of the companies were in the clothing and shoe manufacturing business.
However, all the news is not bad. Several new operations have been established in the zone this year, creating 2,756 new jobs.
Officially, the cause of the shutdown is attributed to competition from Asia, but Nieng Hsing also appears to have run afoul of the regulatory environment.

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