The decline in the number of companies in Nicaragua's free trade zones partly explains the loss of nearly 1,700 jobs in the first two months of the year.
Figures from the Central Bank of Nicaragua (BCN) show that between December 2018 and February 2019, the number of workers decreased by 1,697, from 125,550 to 123,853.
The number of companies in free trade zones also fell at the beginning of the year, from 194 in December 2018 to 187 in February 2019.
On January 5th, 2019, an 8.25% increase in the minimum wage for workers in free trade zones came into effect in Nicaragua.
According to the Ministry of Labor, the minimum monthly wage in the free trade zones last year reached $168 during 2018, and with the increase in force since the beginning of the year, the minimum monthly payment will be $182.
The increase in salary is because employers and workers signed a multi-year agreement to increase the minimum wage annually by a percentage of 8.25% in the period 2018-2022.
From October 1 to 3, Guatemala will be hosting a Conference on Free Zones of the Americas, where topics such as the potential and benefits of companies in the sector will be discussed.
From a statement issued by the Association of Free Zones of the Americas:
Guatemala, September 19, 2018.- The Association of Free Zones of the Americas - AZFA - together with the Santo Tomas de Castilla Free Zone, Chamber of Industry, Chamber of Commerce and the Ministry of Economy, presented the twenty-second Conference for Free Zones of the Americas to be held from October 1 to 3 at Hotel Casa Santo Domingo, in Antigua Guatemala.
There is still no legal framework to manage the international cooperation funds that would finance the implementation of the customs union between the two countries.
Even though the Central American Economic Integration Secretariat (SIEC) announced "progress" in the process of the Customs Union between Guatemala and Honduras, Elperiodico.com.gt denounced the obstacles preventing it, "...
Most of the products which Nicaragua exports to the USA will continue to enjoy, for at least 10 years, tariff advantages compared to those products sold within the Transpacific Association Agreement.
From a statement issued by the US Embassy in Managua:
The Director of the Office of Bilateral Trade Affairs, Department of State, Robert D. Manogue, visited Nicaragua for the purpose of holding meetings with government cabinet members in charge of the portfolio of foreign trade and private sector members, with whom he discussed opportunities for Nicaragua to achieve greater economic prosperity.
The governments have confirmed that the process of technical implementation of the customs union will take between five to six months.
The Minister of Economy and Finance Ruben Morales referred to the process of the Customs Union between Guatemala and Honduras as "a gradual and progressive process, since its implementation will take five to six months. This process involves several institutions in the two countries. "
The decree approved by the Guatemalan Congress was the missing step needed to implement the free movement of people and goods between the two Central American countries.
From a statement issued by the Ministry of Trade:
Guatemala, January 22, 2016. The Congress of Guatemala yesterday approved a Protocol Enabling the Deep Integration towards the free movement of people and goods between the Republics of Guatemala and Honduras.
The country wants to take advantage of the tariff preferences it has to export shoes to the United States and the European Union so as to attract foreign investment to the sector and turn it into an export platform.
From a statement by Pro Nicaragua:
All footwear manufactured in Nicaragua has duty free access to the United States, the European Union and other important markets.
From 12 to 14 November representatives from free zones in Latin America will be gathering together in Panama City to discuss issues such as changes in legislation and the role of free zones in the logistics chain.
The topics to be discussed range from innovation and new business in free zones and industries to changes to key legislation for the creation of logistic nodes.
Analysis of the impact of the Trans-Pacific Partnership on the region.
The competition which sectors such as textiles could face is one of the elements raising questions among employers in the region, compared to the real benefits that could be accrued if Central America participates in the Strategic Economic Trans Pacific Partnership (TPP).
The presence of direct competitors, such as countries like Vietnam, in the textile sector, and the possibility of losing dominance in the American market due to trade rules that TPP countries must meet, is unsettling the productive sectors in the region and forcing a reckoning of the pros and cons of a possible entry to the block to be undertaken.
On 22nd and 23rd of August entrepreneurs from 10 American countries related to activity of free zones will be meeting in Panama.
Representatives from Colombia, the Dominican Republic, Guatemala, Uruguay, the USA, Paraguay, Brazil, Ecuador, Argentina and Panama, will be taking part in the event organized by the Association of Users of the Colon Free Zone (AU).
Starting in 2011 the "Better Work" Program has generated improvements in working conditions and competitiveness in free zone companies in Nicaragua.
From a press release issued by the Ministry of Labour in Nicaragua:
For companies in the Nicaraguan free zones the "Better Work", is viewed as a good experience, because its primary objective is to improve working conditions, competitiveness and to analyze the business of free zone companies.
Representatives of the Government of Nicaragua have made assurances that the tax reform will not affect the incentives announced in the FTZs.
The presidential delegate for the Promotion of Investment and Trade Facilitation, Alvaro Baltodano said, "What's in free zones, stays as it is, it will not change."
"'Remaining intact, that is what we are working on in order to see how the tax reform will work, but free zones will remain unchanged, everything that is in a free zone, stays as it is, it will not change", said Baltodano , who participated this morning in a forum with foreign investors", reported Elnuevodiario.com.ni
After strong growth in the early part of the year, textile mills in the free zones of Nicaragua are reducing their workforce due to falling orders from the U.S.
In January and February, customer demand in the U.S. grew by 55%, but has declined in recent months according to the growth of inventories, said representatives of companies in the textile zones.
The Nicaraguan Federation Chamber of Private Free Zones plans to install 15 companies in 6 new industrial parks within the country this year.
The secretary of the Nicaraguan Federation Chamber of Private Free Zones (FCNZFP in Spanish), Mario Zelaya, said the new industrial parks will be located in Niquinohomo, Masaya, Leon and El Viejo (all areas on the Pacific side).
español
3604
