Guatemala: Textile Industry Suffers Damages

The transfer of three Korean operations operating in the country and an uncertainty in fiscal terms for the new period, have kept the sector in suspense.

Thursday, January 7, 2016

Historically Guatemala has been one of the most competitive countries in the textile industry, but the legislative backlog in extending incentives to maquila companies and free zones regimes, and the departure of three Korean companies in the country in the last year, have placed the sector in a state of uncertainty.

Added to this is the stagnation of projects such as the Investment and Employment Act, and the Emerging Act for the Conservation of Employment, both still in the legislative power.

Alejandro Ceballos, vice president of the Garment and Textiles Commission (Vestex), told Prensa Libre that Korean companies moved their operations in 2015 to countries such as Nicaragua, Haiti and Costa Rica.

And although the sector at the moment has no immediate closures planned because of this lack of regulations, an expectation persists relating to the priority Congress will give to pending projects when it resumes work.



More on this topic

Textile Industry: $20 Million Investment Announced

November 2020

In Guatemala, a Korean business group plans to invest in the start-up of a fabric factory in the municipality of Villa Nueva.

The fabrics that will be manufactured in the new industrial plant will be specialized and will supply other factories in the region, informed authorities and businessmen of the sector.

Guatemala: Call to Boycot Income Tax

January 2016

With the hope of getting exemptions reinstated, maquila sector union representatives are calling on a thousand companies to avoid the payment of the income tax until the exemptions are reactivated.

The Superintendency of Tax Administration (SAT) confirmed in early January that both administrators and users of free zones and maquilas (by decree 65-89 and 29-89 respectively) must pay income tax (ISR) for the fiscal year 2016.

Guatemala: Textile Companies Urge Investment and Employment Law

March 2015

The guild is once again insisting on the urgency of the government passing the law which grants tax incentives to the maquila industry so that they can remain competitive in the global market.

Once the Investment and Employment Decree 4644 is approved, there would come into effect "...

Yarn Factory "Selim" Closes in Guatemala

November 2009

"Selim Guatemala S.A." was one of the few producers of colored yarn in the country.

The company moved its Guatemalan operations to Singapore, which employed 100 people.

Alejandro Ceballos, president of Vestex, the Apparel and Textile Commission, told local newspaper 'El Periódico': "...the company had been looking for financing for a long time, but finally decided to relocate to Singapore".

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