The cost of labor is critical for textile companies which migrate from Honduras to El Salvador and Nicaragua, where wages are lower.
Daniel Facussé, president of the Honduran Manufacturers Association (AHM), states that 16 textile companies have moved their operations from Honduras to Nicaragua and El Salvador since the end of 2008.
For the Businessman, the main reason is the difference in wages between Honduras and its neighbors.
Generates business opportunities by linking supply and demand of goods and services between Central America and the rest of the world.
Organization that operates in Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama
Phone: (506) 225 4786
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.
"Recently, CAMTEX noted that the increase in the price of key raw materials and inputs for production could not be completely absorbed by the companies.
The Investment Promotion Agency announced for early next year the arrival of a textile and plastic companies.
Without going into details, Mariano Olazabal, director of Proesa, said the textile company would invest about $ 12 million and the plastic company would make an investment of about $ 25 million.
"Those are the two most important investments expected in the coming months, although there are also expansions expected in some of the companies already operating in the country," writes Laprensagrafica.com.
The company begins its operations in Central America by opening its manufacturing plant.
The factory will employ about 175 people in production and processing of multi-filament polyester, nylon textured yarns and related raw materials.
"Industry sources indicated that the manufacturing plant, Unifi Central America Ltd., will have eight texturing and 27 winding machines increasing the company´s capacity in the hemisphere," writes José Luis Henríquez on his article in Elsalvador.com.
Textile businessmen does not dare to raise expectations for next year.
If there is an increase it would be minimal, said Edwin Zamora, president of the Chamber of the Textile, Clothing and Free Zones of El Salvador (CAMTEX).
The executive added that it all depends on the evolution of the U.S. economy.
"He even mentioned that the costs of raw materials, especially cotton, are of secondary concern," reported Laprensagrafica.com.
In times of low cotton production, the Latin American textile industry protests against restrictions imposed on exports from India.
The price of cotton has risen more than 70% so far this year, as a result of lower production, a situation that profoundly affects the textile industry.
India, a major producer of cotton and textile products, imposed in April restrictions on cotton exports, which contributed to increase the price for textile producers from other countries.
The record price achieved for cotton would increase operating costs for enterprises in 2011.
The contract for December delivery closed at $ 1.2463 a pound on Friday, versus $ 1.1971 the previous week, according to Dean Garcia, director of the Nicaraguan Association of Textile Industry. In the last three months the price has increased by 56%.
"For Nicaragua's textile sector it could mean 'stagnation' of sales, so we should be analyzing strategies to confront the situation," Laprensa.com.ni reported.
Exports are dominated by coffee, underwear and sugar, while the country mainly imports hydrocarbons.
El Mundo published a profile of Salvadoran trade, highlighting the top 10 export and import items between January and August 2010, quantifying how much was negotiated with Central America and the rest of the world.
During that period, the country bought $ 987 million in oil, $ 253 million in production equipment, $ 224 million in medicines, $ 217 million in cash and $ 156 million in plastics.
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.
Laprensagrafica.com reports, "Moreover, the industry says they hope to achieve an agreement with the Government to amend the Free Zones Law, but without altering the benefits which encouraged them to invest in the country, as the Organization World Trade Organization (WTO) stated that it should be removed by December 31st, 2015.”
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 "...
Between June 2009 and July 2010, at least 13 projects in the textile industry were suspended because of insecurity problems and lack of competitiveness.
Companies from the Chamber of Textiles Industry, Confection and Free Zones (CAMTEX) reported uncertainty in legal areas and economy problems as additional reasons to suspend said projects.
"As for security, some $2.26 million have been spent in security measures and lost investment.
Three Salvadoran companies took part in the Sourcing at Magic event held from 16 to 19 August in Las Vegas.
The textile manufacturers that attended were Industrias Argueta, Confecciones Samia and Dany S.A., according to a report from the country's export association, Exporta El Salvador.
"Given that Sourcing at Magic is a world class event for the entire apparel and footwear supply chain, exclusive designers and brands were represented.
The proposal presented by the Textile Industry Chamber did not receive support from the Ministry for Employment.
The plan promoted by the industry is for a change in working hours from a three and half day week to eight hours daily.
"Patricia de Figueroa, the Chamber's executive director, stated that the plan did not receive the backing required from the Ministry for Employment, which described it as unconstitutional," reports Elsalvador.com.