Comparative Advantages And Disadvantages Of Investment In Nicaragua's Textile And Garment Industry

Processing export area is the main driving force and important source of foreign exchange for Nicaragua's economic growth.

Central bank capital.

PRONicaragua points out that the Nicaragua processing area attracts about 300 million US dollars per year, and the total amount of direct investment in Nicaragua in 2015 will grow from US $1 billion 500 million in 2014 to US $16 billion 500 million. The processing zone manufacturing industry is expected to grow by 7%.

Compared with the lowest monthly salary in the Caribbean Haiti and Dominican processing area, Nicaragua is 150 dollars, which is higher than Haiti's 130 US dollars and 141 dollars of Dominican Republic, but compared with other countries in Central America, Nicaragua has the lowest level.

The advantage of Salvatore is $2109 and Costa Rica is more than $520.

But Nicaragua does not have a complete advantage. In terms of energy and pportation costs, Nicaragua is higher than other countries.

In terms of industrial electricity, the electricity tariff in Nigeria is the highest in Central America, which is 026 US dollars per hour, while Honduras and Panama are 024 US dollars and 023 US dollars respectively.

In terms of pportation cost, according to the world bank DoingBusiness2015 report, the average export cost of Nicaragua processing area is 1140 US dollars per container, Domin Ni Fagafaga 1040 US dollars, Haiti 1200 US dollars, Costa Rica 1020 US dollars.

In terms of import pportation costs, Nicaragua is also higher than other neighboring countries. The average cost per container for imported containers is 1250 US dollars, while that for Salvatore is only $1030.

The main reason for the high pportation cost is that Nicaragua lacks an appropriate seaport on the the Atlantic coast. The container for East exports must borrow the port Cort s of Honduras, resulting in an increase of about $800 in cost.

To sum up, Nicaragua processing area

With relative advantages and disadvantages, based on the analysis of Nicaragua economists, in general, the low wage in Nicaragua is enough to make up for other disadvantages, and the manufacturing industry in the processing area is still quite competitive.