Interviews
Nicaragua more competitive than China in apparel production
29 Jun '11
2 min read
According to the results of a recent study conducted by Mary O'Rourke, President and Managing Director of the textiles and apparel consulting firm O'Rourke Group Partners, Nicaragua was found to be the single most competitive option for sourcing numerous apparel products, not just in this hemisphere, but in some cases also compared to China, Vietnam and Bangladesh.
The study titled “Benchmarking the Competitiveness of Nicaragua's Apparel Industry” presents a solid benchmark analysis of Nicaragua and other major US apparel suppliers in Asia and the Western Hemisphere throughout the apparel industry's value chain. According to O'Rourke, “Nicaragua's future lies on the apparel manufacturing as the country presents a sustainable situation, which cannot be said for other suppliers.”
The results of the study clearly demonstrate Nicaragua as the most competitive option in the region for apparel manufacturing due the country's low costs, educated labor pool and improving labor productivity, an excellent free trade zone system, infrastructure developments, the lowest incidence of crime in Central America and its consistent quality, as well as its speed to market performance.
Also, recent and significant raw material cost increases on a global basis have led to increases in overall production costs in the countries competing with Nicaragua. In turn, Nicaragua's government recently announced the beginning of a cotton production pilot in the second semester of 2011, which will significantly foster the sustainable development of Nicaragua's textile industry by supplying local raw materials and contribute to the vertical integration of the industry, strengthening the country's value chain and reducing costs.
By 2010, Nicaragua was the 12th largest worldwide apparel supplier to the U.S. in volume, thus becoming an important player in the global textile and apparel industry. According to estimates by the National Commission of Free Zones (CNZF), in 2011 there will be significant growth in textile exports, reaching a total of US$1,300 million, a 28 percent increase versus exports in 2010.
The study titled “Benchmarking the Competitiveness of Nicaragua's Apparel Industry” presents a solid benchmark analysis of Nicaragua and other major US apparel suppliers in Asia and the Western Hemisphere throughout the apparel industry's value chain. According to O'Rourke, “Nicaragua's future lies on the apparel manufacturing as the country presents a sustainable situation, which cannot be said for other suppliers.”
The results of the study clearly demonstrate Nicaragua as the most competitive option in the region for apparel manufacturing due the country's low costs, educated labor pool and improving labor productivity, an excellent free trade zone system, infrastructure developments, the lowest incidence of crime in Central America and its consistent quality, as well as its speed to market performance.
Also, recent and significant raw material cost increases on a global basis have led to increases in overall production costs in the countries competing with Nicaragua. In turn, Nicaragua's government recently announced the beginning of a cotton production pilot in the second semester of 2011, which will significantly foster the sustainable development of Nicaragua's textile industry by supplying local raw materials and contribute to the vertical integration of the industry, strengthening the country's value chain and reducing costs.
By 2010, Nicaragua was the 12th largest worldwide apparel supplier to the U.S. in volume, thus becoming an important player in the global textile and apparel industry. According to estimates by the National Commission of Free Zones (CNZF), in 2011 there will be significant growth in textile exports, reaching a total of US$1,300 million, a 28 percent increase versus exports in 2010.
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