In recent years, the sector in Guatemala has lost nearly 30,000 jobs, because the high costs resulting from having one of the highest minimum wages in the region, makes it more profitable only to export raw materials, rather than making them in the country.
Vestex figures show that in recent years several jobs have been lost in the sector, given that between 2006 and 2018 the industry lost a considerable number of jobs, going from 82,109 to 53,636 places, equivalent to a 35% decrease.
In the first quarter of the year, imports of yarns and textile supplies in Central America totaled $127 million, registering a 10% drop compared to the same period in 2017.
Figures from the Information System on the Textiles and Textile Supplies Market in Central America, compiled by the Business Intelligence Unit at CentralAmericaData: [GRAFICA caption = "Click to interact with graph"]
Companies from Hong Kong and Taiwan could be interested in setting up a synthetic and manufacturing plant in the country.
The information was provided by representatives of the Apparel and Textile Commission (Vestex) at Agexport, who explained that in the case of the company from Taiwan, its interest is in establishing a manufacturing plant and supplying the US market.The other company, from Taiwan, could be interested in installing "... a manufacturing plant for synthetic products, and the countries that they are investigating are Guatemala and Haiti."
In 2016, the value of imported yarns and textile raw materials in the region amounted to $328 million, equivalent to 89 thousand tons, 6% more than the volume purchased in 2015.
Figures from the information system on the Central American Market for Yarns and Textiles materials, compiled by the Business Intelligence Unit at CentralAmericaData: [GRAFICA caption="Clic para interactuar con la gráfica"]
Within the framework of the Apparel Sourcing Show, a delegation of Chinese textile entrepreneurs will be visiting the country in May, to explore business opportunities in the sector.
The Apparel Sourcing Show event will be held from May 23 to 25 at the Grand Tikal Futura Hotel, and will bring together textile companies from the Central American region and from other countries.
A meeting is being convened for the textile and clothing industry on March 16 in El Salvador, where the overall situation in the sector will be discussed.
From a statement issued by Proesa:
El Salvador is preparing for the third edition of the Forum of Textiles and Apparel (FOROTEX) 2016, a space where high-level international speakers present trends and strategies for competing in international markets.
Its participation in the US market has dropped, but the unification of the cluster now encompasses the entire manufacturing process, generating exports worth $1.5 billion.
The integration of the production process, generating greater added value to all parts of the production chain of the textile industry, has enabled the industry to stay afloat and face off competition from producers such as Vietnam and other Southeast Asian countries.
The implementation of lean manufacturing systems reduces from two hours to five minutes the time it takes to make a garment.
This system, introduced in the textile fair Apparel Sourcing Show 2014, in Guatemala, unifies in a set sequence the "value" steps of the manufacturing process, completely eliminating "waste" steps resulting in higher productivity and resource optimization so that the number of operators needed to make a garment is only nine instead of fifty.
Next Friday and Saturday 24th and 25th August a mission of businessmen from the Indian textile industry will be looking for investment opportunities and partnerships with Guatemalan companies.
According to information from the Indian Embassy in Guatemala, the meeting will take place on Friday at the Hall of the Hotel Camino Real Vega, Area 10. Buying and selling negotiation rounds will be held at the event.
Aggressive measures must be taken in marketing and attracting investment in order to exploit the possibilities opened by the DR-CAFTA and changes in the global market.
From Diario de Centro América:
The CAFTA-DR region has opportunities for growth
The clothing and textile sector of the country is ready to compete globally.
Opportunities in the region provided by the Free Trade Agreement between Central America, Dominican Republic and the U.S.
Businessmen say that clothing and textiles have regained the export levels of pre 2008-2009, when sales plummeted by 30%.
The president of the Garment and Textile Committee (Vestex), Carlos Arias, said that in 2008 and 2009 the industry saw sales drop by 30%. This meant that 15,000 people lost their jobs.
"There is a direct link between sales and jobs, and last year we recovered about 30% of the production affected by the crisis, so we believe that a similar recovery can be seen in terms of employment", said Arias to Siglo21. com.gt.
The industry ranks as the number one generator of foreign exchange with $1,130 million exported in 2011, displacing coffee, according to official data.
Guatemalan clothing and textile exports reached $1,130 million between January and November 2011, which slightly exceeds the revenue generated by coffee, which amounted to $1,110 million in the same period, reported the Bank of Guatemala (Banguat).
The lower labor costs offered by China are no longer such, due to the 22% increase in the minimum wage for workers.
There are positive expectations for the maquila and textile sectors in Central America regarding the return of companies who had migrated to China because of the lower labor costs.
With the disappearance of this advantage, Central America is once again among the best options for multinationals, having as an advantage its proximity to the U.S., which reduces transportation costs and delivery times.