Nicaragua Textile Exports To The United States Will Face A Negative Impact.

The United States gives Nicaragua textile operators preferential treatment of TPL Tariff Preference Level annually, which will expire at the end of 2014. Although the United States Congress is still in the pending trial for extending the TPL case, it is analyzed that the case is bound to not be considered before December 31st, due to the fact that there are too many issues and major issues in the US.

Nicaragua businessmen and related associations are worried that the textile industry will face a negative impact.

according to

(Anitec) executive director Dean Garcia pointed out that the Nicaragua textile duty free export quota (TPL) could not be successfully extended at the end of 2014, and the textile factories that had invested in factories in Nicaragua in 2015 would not be able to enjoy cheap raw materials imported from other countries. The sale of manufactured products in Nicaragua to the United States would result in the loss of labour in the textile industry of 10 thousand to 15 thousand processing areas.

Agri (Jose Adan Aguerri), chairman of the Supreme Council of private enterprises (COSEP), advocated that the textile industry, workers and government units should jointly study countermeasures to minimize the impact of the textile industry.

The Council pointed out that at present, the total number of employees in the processing export area is 108000, of which 71000 of the workers in the textile and garment factories are 71000. In the future, the allowance for textiles exemption from the US quota (TPL) will be estimated to cause 10 thousand to 15 thousand workers in the processing area textile industry to lose their jobs.

The Association believes that if the United States Congress can make a decision on the TPL case in the next 6 to 12 months, the unemployed population will be reinstated by 2016.

At present, 30% of the textile producers who make international famous brand garments in Nicaragua have TPL discount. If some garments are purchased from Costa Rica, which belongs to the United States and the Central American and Dominica free trade agreement (CAFTA) member countries, the duty-free export to the United States will not be affected.

However, whether the textile operators who invest in Nicaragua can still maintain their operations, remain in Nicaragua or move to other factories after the expiration of the TPL, which will expire at the end of 2014, will be an important factor that will affect Nicaragua's future economic development.