Following the spread of the virus globally and the suspension of some production in China, several garment companies in the region have reported increases in their orders.
The spread of the epidemic has stopped much of the economic activity of the Asian giant, which is the largest exporter of textiles in the world.
The sector's union says that the strategy focused on producing fabrics and yarns for export is already paying off, and they intend to continue in order to become the region's main supplier.
According to the Chamber of the Textile, Clothing and Free Trade Zone (Camtex), exports of raw materials from El Salvador have grown considerably in the last two years, as between 2016 and 2017 sales increased from $60,000 to $1.2 million.
According to the textile industry union, half of the $2.6 billion exported in 2017 corresponded to pullover sweaters, cotton t-shirts, cotton briefs, synthetic fiber t-shirts and synthetic socks.
The Chamber of Textile, Clothing and Free Trade Zones of El Salvador (Camtex) reported that in 2017 the sector exported $2.617 million worth of clothes, $95 million more than was reported in 2016, which is equivalent to an interannual increase of 3.8%.
The textile guild has stated that 2017 closed with $2.6 billion in exports and an increase of almost 4%, and for this year it plans to achieve similar growth.
The Chamber of the Textile, Clothing and Free Trade Zone (Camtex) exported $2.617 billion during the past year, $95 million more than the value of exports registered in the previous year.
Salvadoran textile companies report that between January and October exports of textiles and clothing grew by 3%, but the maquila sector went down by almost 9% compared to the same period in 2016.
Patricia Figueroa, executive director of the Chamber of the Textile, Clothing and Free Trade Zone (Camtex), explained to Laprensagrafica.com that"... the sub-segment of the maquila 'is where the basic products are, such as T-shirts and underwear, but it is a segment that has to be taken care of because it is more vulnerable to costs and environmental shocks."
To compensate for the loss of market which is expected once the Transpacific Agreement takes effect, the textile industry intends to resume FTA negotiations with the northern country.
A free trade agreement with Canada would allow the exporting textile companies to enter a market with high potential, since according to theexecutive director of Camtex, Patricia Figueroa, the country imports more than $14,000 million a year in textiles products and confection of synthetics such and towels, carpets, curtains and tablecloths. "
There is a growing demand for textiles and clothes manufacturing, but a new Law on Free Zones is needed in order to bring fresh investments to this sector.
The World Trade Organization (WTO) has determined, after two extensions, the country should, in 2015, replace the law that has been in force since 1998, which grants tax benefits such as a total and permanent exemption from taxes, among others.
A change in the incentives for foreign investment is needed in order to remain competitive in respect to other countries in the region.
The modernization of the law on free zones, which countries like Costa Rica reshaped in 2005, for the purpose of improving incentives to attract foreign companies is still in process in El Salvador.
In 2010 the sector reported revenues of $ 1.793 million compared to $ 1.422 million in 2009.
Patricia Figueroa, director of the Chamber of Textile Apparel (CAMTEX), said they hope to continue growing in 2011 despite the increase in prices in raw materials, including cotton.
The textile and apparel sector is expected to close the year with a 25% increase in exports.
Patricia Figueroa, executive director of the Chamber of the Textile, Clothing and Free Zones of El Salvador (CAMTEX), praised the strength of the sector, which despite lack of investments and reduction of staff, has succeeded in increasing exports.
Organized by the Chamber of Textile Industry in El Salvador, the event will be held on October 8th at the Crowne Plaza Hotel.
The first regional textile and clothing forum with discuss challenges facing the region against Asia´s accelerated growth in Asia.
Emilio Herrera, chief executive of the Salvadoran Chamber of Textiles and Apparel (CAMTEX) released some figures in an interview with ElSalvador.com "... from 2000 to 2009 Asia increased 1.5 times its exports, the CAFTA region exported in 2009 only 68.6 percent of what was exported in 2000, China multiplied 4.9 times its exports to the U.S. from 2000 to 2009 and El Salvador last year exported only 82.4 percent of what exported in 2000.”
Such is the desire of Salvadoran textile businessmen, who hope to transform the country into a more attractive destination for foreign investment.
CAMTEX, the Textile and Apparel Chamber, explained they are having talks with the government to draft a new law which complies with WTO requisites (World Trade Organization).
Orders are increasing as the United States, main destination for Salvadoran textile exports, begins to recover.
Patricia Figueroa, executive director of CAMTEX (Textile and Free Zone Chamber of El Salvador), commented that an increase in U.S. orders has allowed company Fruit of the Loom to reactivate its Montecristo facility.
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