Home / Knowledge / News / Apparel/Garments / Nicaragua positioned to excel in apparel production
Nicaragua positioned to excel in apparel production
Jul '11
Official Investment Promotion Agency of Nicaragua (PRONicaragua) says that Nicaragua is once again attracting the attention of international apparel producers as a key factor has caught their eye: the country's cost competitiveness. Nicaragua was found to be the single most competitive option for sourcing numerous apparel products, not just in this hemisphere, but also compared to China, Vietnam and Bangladesh, according to the study titled “Benchmarking the Competitiveness of Nicaragua's Apparel Industry”, conducted by the prestigious consulting firm O'Rourke Group Partners. Here are the main reasons underlying the country's success in the industry:

Free trade agreements (FTA) such as the DR-CAFTA and its complementary trade benefits, in force since 2006, have allowed Nicaragua duty-free access to the U.S. market and therefore helped position the country as a major global cost competitor in several product categories. It is due to this advantage that by 2010, Nicaragua ranked as the 12th largest worldwide apparel supplier to the U.S. in volume, thus becoming an important player in the global textile and apparel industry.

Furthermore, cost competitiveness on a global basis has shifted significantly since 2010, due to unprecedented increases in the price of raw cotton fiber, which in turn have narrowed price gaps between Asia and countries in the Western Hemisphere. When comparing basic denim jeans production costs (LDP), China experienced a 27 percent increase between June 2010 and February 2011, while Nicaragua increased only by 15 percent during the same period. Although China's production costs for basic denim jeans in June 2010 were 3 percent lower than production costs in Nicaragua, by February 2011 Nicaragua's costs were 6 percent lower than China.

In turn, Nicaragua's government recently announced the beginning of a cotton production pilot project in the second semester of 2011, which will significantly foster the sustainable development of Nicaragua's textile sector by supplying local raw materials. The project will also contribute to the vertical integration of the industry and the strengthening of the country's value chain.

Particularly, having the most competitive labor costs in Central America constitutes a key decision factor for companies looking to establish labor-intensive operations. The country's 2.8 million labor force is known to be flexible, with excellent working habits, a fast learning curve and low absenteeism and attrition rates. Also, Asian competitors such as Vietnam and Bangladesh, have not only increased labor costs but still present low labor productivity, which in turn “negates or narrows the gap in overall apparel competitiveness compared to Nicaragua”, according to the study. On the other hand, Chinese labor costs increases ranged from 18 percent to 24 percent during 2010.

Nicaragua also has an excellent track record in providing speed-to-market garment sampling and production supply, which is a determinant in decreasing overall production costs. Nicaragua's lead time, including regional fabric acquisition, averages from 52 to 60 days, but can be as short as 42 days or even two weeks when fabric is on-site.

Must ReadView All

(L-R) Mr Shao Bojin, Chairman of Jihua Group and Mr Rohit Aggarwal, President of Huntsman Textile

Textiles | On 28th Oct 2016

Huntsman gets into strategic partnership with Jihua Group

Huntsman Textile Effects, the leading provider of high quality dyes...

Marzoli FT6D roving frames in Sintex’s Unit 2. Coutresy: Marzoli

Textiles | On 28th Oct 2016

Marzoli roving frames erected at Sintex textile division

A total of 48 Marzoli roving frames were erected in units I, II and...

Courtesy: Polartec

Textiles | On 28th Oct 2016

Polartec innovates most breathable waterproof fabric

Polartec, the premium provider of innovative textile solutions, has...

Interviews View All

Shawn Honeycutt
Bolger & O'Hearn

‘The Indian market is interesting and rather persistent in seeking new...

Nitin Soni
Dolphin Jingwei Machines

Taxation policies need to be made simpler

Awen Delaval

'Natural fibres are appreciated for traditional authenticity'

Iago Castro Asensio
RCfil Distribuciones S.L.

Iago Castro Asensio, International Business Manager of RCfil...

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Suresh Patel
Sidwin Fabric

Sidwin Fabric is a manufacturer and exporter of polypropylene textiles and ...

Tony Ward
Tony Ward

"You have to truly understand what your client wants, know her needs, what ...

Karan Arora
Karan Arora

Bridal couture created with rich Indian heritage, exquisite craftsmanship...

Igor Chapurin

"Now we can see the Russian trend in international fashion. And Russian...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


Letter To Editor

(Max. 8000 char.)

Search Companies

October 2016

October 2016

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Browse Our Archives


Advanced Search