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Honduras Sets Sights on Commanding More Apparel Share by 2020

Central America has gained traction as a speedier sourcing option for U.S. companies, and Honduras wants to make sure its slice of that pie grows in the next few years.

The country has launched an economic transformation unit dubbed Honduras 2020, designed to attract and facilitate investment in the textile and apparel sector there.

Between now and 2020, Honduras plans to expand its logistics infrastructure at Port of Cortes, the largest port in Central America, provide export pre-clear security for the U.S., add capacity and capability to its manufacturing facilities and introduce renewable energy plants, to name a few efforts.

“Textile and apparel industry investment represents a great socioeconomic impact for both parties,” the Honduras 2020 project said in a statement. “The country where the investment takes place is provided with employment opportunities that reduce unemployment percentages and, on the other hand, investors are granted the benefit of improving their performance margins since their costs diminish due to highly productive labor force.”

[Read more about opportunities in Central America: Central America Looks to Surpass Asia for Affordable Quick Response]

When it comes to capabilities, a statement from Honduras 2020 said the country is the No. 1 cotton shirt exporter to the U.S. market, and it’s No. 2 in U.S.-bound sweaters in terms of volume.

Last year, the U.S. took in $2.57 billion worth of textiles and apparel from the country, a 4 percent fall from 2015, according to OTEXA data, but for the year to June 2017, U.S. imports from Honduras are essentially flat to the same time last year.

The biggest hook for Honduras has been its proximity to the United States, particularly now that more brands are looking to do smaller runs more often and have them delivered in nothing flat.

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“Port to port freight to United States takes an average of 2.4 days,” Honduras 2020 said. “Thanks to COPRISAO, the Presidential Committee for Customs Reforms, clearance times were reduced from 12 days in August 2016 to an average of two days in March 2017, representing a time reduction of 83 percent.”

What’s next for Honduras

The vision for Honduras 2020 is to position the country as the textile export leader in the Americas delivering to the U.S. and Europe, reaching a total of $7.4 billion in exports—all of which the country expects to manage through a textile hub that “pushes the frontier of knowledge in textile sustainable development.”

Eighteen industrial parks in the country command a construction area of more than 1.8 million square meters.

“As an outcome of the country’s competitive advantages for this industry, a recent investment of $78 million in a synthetic yarn plant is expected to manufacture 20,000 tons annually,” according to the Honduras 2020 statement.

Beyond that, the country has implemented the largest solar roof installation in Latin America with an installed capacity of 7.5 megawatts of clean energy. The textile industry in the country also has capacity for biomass production an wastewater management technologies that foster high productivity while maintaining a sustainable process.

“The Honduran textile and apparel industry counts with important initiatives in terms of social responsibility and sustainable development, including programs aimed at education, health and environment,” Honduras 2020 noted.