In the first 8 months of 2022, Honduras exported US$2. 23 billion in finished textiles and apparel to the United States, of which US$1. 57 billion was sold under special access provided through CAFTA-DR (Central America-Dominican Republic Free Trade Agreement), according to OTEXA, the U. S. Bureau of Textiles and Apparel. U. S. volumes up to 15. 3% to 87 MM2.
In contrast, Mexico sent $4. 3 billion in the first 8 months of this year 2022. Honduras, which maintains a multiparty democracy despite high crime rates, is the largest supplier of apparel and textiles to the United States in the CAFTA-DR region. , followed by Nicaragua ($1. 74 billion), El Salvador ($1. 39 million), Guatemala ($1. 36 million), Dominican Republic ($522 million) and Costa Rica ($42. 5 million).
So it’s no surprise that the garment and textile industry is Honduras’ main export sector, blamed for 7% of the country’s GDP, offering 173,000 jobs, according to the Honduran Association of Industrialists (AHM – Asociación Hondureña de Maquiladores), the country’s largest apparel and textile trade group.
Indirectly, the sector contributes 29% of Honduran GDP and provides 83,000 jobs in sectors such as transport. Currently, 19 companies producing primary textiles and clothing are operating in the country, while there are 273 producing companies, the AHM said.
These corporations are in the midst of an ecosystem that helps keep Honduras solvent: around 31 major Honduran corporations source everything from machines, buttons, threads and labels to plastic bags, elastics and zippers. These suppliers are also engaged in the manufacture of clothing and textile supplies for many foreign corporations. And with the U. S. With the U. S. government importing goods closer to home due to transportation issues and inflation caused by the pandemic and fueled by Russia’s bloody invasion of Ukraine, the Central Bank of Honduras says U. S. imports of all goods from Honduras grew faster than expected in the first part of 2022. through 6. 7% year-on-year.
This good fortune was based on Honduras’ textile and garment industry exports in 2021, which increased thanks to increased demand, mainly from the United States, and the AHM said the industry’s export expansion that year was 8. 6% compared to 2019, just before the pandemic. . hit. The top export products with the highest export rates are T-shirts, socks, sweatshirts and cotton shirts, he told Just Style.
Honduras is also a key U. S. yarn customer, with imports purchased for $1 billion, accounting for 23% of total yarn sales in the United States, the AHM told Just Style.
The Office of the U. S. Trade Representative (USTR) noted in 2019 that Honduras imported $719 million worth of cotton and artificial fibers cut from the U. S. The U. S. Department of Commerce has a strong “vertical integration of its textile industry, which is a component of the industry and strategic dating between Honduras and the United States. “
In August, the U. S. government took a role in the U. S. government. The U. S. Department of Commerce subsidized a memorandum that aims to strengthen textile production and sourcing in Honduras, Central America, and the United States, with the goal of expanding proximity and relocation opportunities.
Honduran sales have also been bolstered through the country’s free zone law, which strengthens the competitiveness of the Honduran textile industry, according to AHM President Mario Canahuati. 10 more years.
It also shortens administrative procedures to safeguard operating authorizations from 8 months to one, centralizing bureaucratic operations in a single institution.
In addition, the country benefits from 24/7 ports that are close to the United States: it only takes 3 days of navigation to move boxes from the main port of the Caribbean Sea of Honduras, Puerto Cortés, to Port Everglades, Florida, Houston or Miami.
Those gains prompted corporations such as Parkdale Mills, a major North Carolina-based manufacturer, to announce plans to invest $150 million in a new spinning mill in Villanueva, near Puerto Cortes, but no additional data was provided. In addition, the company will allocate $24 million of its investment to ensure that its production plants in Honduras use high-efficiency and more environmentally friendly solar energy systems.
Another example is SanMar, a US-based clothing wholesaler. The U. S. government, which said last December (2021) that it would increase its purchases of products made in northern Central America, basically Honduras, until 2025. That commitment will mean more production in Honduras, in particular, an additional 4,000 full-time jobs at Elcatex, a clothing manufacturer based in Choloma, also near Puerto Cortés, partly owned by SanMar.
WHA’s Canaguate estimates that long-term investments in textiles and apparel will generate at least 15,000 jobs in the country over the next five years. In September, Hanesbrands announced it would close its Jasper plant in Choloma, Honduras, starting in November 2022, wasting 1,700 jobs.
Other companies have halted orders, the WHA said, but the effect this will have on Honduras’ export figures for now part of 2022 remains to be seen.