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Business sectors in Honduras: Textile and Apparel Industry

Honduras has become Central Americas apparel production center due to the many advantages it offers. Today, it is the third largest worldwide clothing supplier to the U.S. market, and number one in the region and the Caribbean.

It has further strengthened its position by implementing the Full Package concept, whereby items are manufactured in their entirety in the country, from the cloth, to the buttons, and packaging under international brand names. Along these lines, this sector offers business opportunities to efficient suppliers, be they small or medium companies, that can interact among themselves to produce great added-value. Among the important advantages Honduras offers in textile and apparel are:

Competitive costs in labor and logistics, among the lowest in the region A flexible and highly skilled labor pool Favorable tax and customs concessions Through CAFTA, Honduras has become an integral part of the North American production and trade process, guaranteeing Honduras the same access as Mexico to the U.S. market Honduras has the advantage over its Asian competition in being an active partner of U.S. and Mexican manufacturers in just-in-time chain of production. Among its advantages is its time zone location, convenient to the Eastern and Central time zones of the U.S. Puerto Corts, the premier port of Central America, has earned the U.S. governments CSI and MegaPort certification and plays a vital role in facilitating just-in-time production for manufacturers throughout North America.

The countrys year-round tropical growing range of products -- milk and dairy products, fish and shrimp, a wide variety of fruits and vegetables, sugar, cocoa, and coffee. Agribusiness and related sectors represent 40 percent of the countrys GDP. Low cost of land, competitive wage rates, close proximity to 300 million consumers in the United States, free U.S. access for 95 percent of fresh fruits and vegetables and 100 percent of processed foods, availability of a highly trained and skilled work force, government incentives, make Honduras ripe with commercial agriculture opportunities. Great investment potential has been identified in seafood, fish, fruit and vegetables.

Honduras has everything it takes to drive and sustain a strong tourism industry, and while some enterprising investors are identifying these opportunities, the demand will increase sharply very soon. The Honduran government demonstrated its strong support for the industry by enacting a tourism incentives law eliminating income taxes and tariffs on new tourism projects. Eligible projects include lodging and resort sites, recreational operators and facilities, car rental agencies, and tour operators. Miles of virginal white-sand beaches, breath-taking reef diving and snorkeling, renowned Mayan archaeology, historic colonial cities, thriving indigenous cultures, and tropical rain forests appeal to visitors looking for an unusual experience in a virtually unexplored land. Investors looking for tourism development opportunities in Central Americas fastest growing tourist destination wont have to look far. Some of the famous tourist spots are:

1) Mayan Ruins

Cultural explorers seeking a glimpse of the ancient world will find a treasure trove in the ruins of Copan, located in far western Honduras. A UNESCO World Heritage Site, Copan is one of the great Mayan city-states and is often referred to as the Paris of the Mayan world. It boasts the largest collections of Mayan hieroglyphic inscriptions and stone monuments and some of the finest pre-Columbian archeology in the world.
2) Rainforests and National Parks

Honduras abundant natural preserves enchant the worlds most adventurous eco-and geo-tourists. La Mosquitia, a region of mangrove swamps and tropical rainforests on Honduras north coast, is home to the most diverse range of indigenous groups in Central America. The Garifuna, Miskito, Paya and Sumo Indians all call La Mosquitia home. White water rafting, jungle hikes and stunning waterfalls are only a few of the delights that await visitors to this remote region. Nestled in the rainforest is another UNESCO World Heritage site, Ro Pltano Biosphere Reserve, which is being considered for the New 7 Wonders of Nature designations. The second largest national park in Honduras, Pico Bonito, offers many attractions. In addition to tackling white water kayaking and rafting, visitors can walk among the clouds in the parks cloud forest. Pico Bonito is also home to diverse wildlife, offering hikers and photographers countless opportunities to view a variety of animals including jaguars, lapirs, pumas, and both white-faced and spider monkeys. The Marriott, Hilton, InterContinental, and Holiday Inn are among the name brand business hotels operating in Honduras, and the Westin, Nikki Beach, and Raffles organizations have each announced plans to build luxury resorts on the Bay Islands. Plans are underway for residential villas and luxury hotels on the Caribbean Coast as well.

Reasons to invest in Honduras:

1) Strategic location:

Honduras is in the heart of the Americas Only two hours by air and 48 to 72 hours by sea to the U.S. Near the manufacturing centers of North America and the largest market in the world. Honduras serves as a distribution platform of Central America.

Among the lowest logistical costs in the region.

2) Modern Infrastructure: Puerto Corts, Central Americas only deep water port, one the most important in the region, the first in Latin America to be certified in both the U.S. governments Container Security Initiative (CSI) and in its Megaports Initiative. Ongoing rapid improvement and expansion of the countrys physical and communications infrastructure. Privatization of the telecommunications sector and the full opening of the energy sector have attracted investors and improved services. Honduras six seaports on its two coasts -- five ports on the Caribbean (Puerto Corts, Tela, La Ceiba, Puerto Castillo and Roatn) and one on the Pacific (Amapala) -- provide ocean access to markets worldwide. More than 120 companies, mostly involved in light assembly, operate in Private Industrial Parks, an industrial model which has run successfully for more than 20 years Free Zones, enjoying tax-exempt status in many categories, can be established anywhere in the country.

Construction of the Inter-Oceanic Corridor will improve the connection between the Atlantic and Pacific oceans via an excellent highway

3) Investment friendly government:

Honduras is governed by a democratic system with solid institutions, a transparent legal system, and political and social stability since 1980 Laws that protect and promote foreign investment provide export-oriented companies fiscal and legal incentives highly favorable to investment Permanent tax exemption in several categories Any part of Honduras can be an Industrial Processing Zone/Free Zone where companies are exempt of all taxes

4) Dynamic workforce:

A young work force composed of more than 2 million Hondurans between the ages of 18 and 35. 10 universities throughout the country that graduate educated professionals. Among the lowest labor costs in the region. Availability of qualified bilingual personnel, a product of more than 150 bilingual institutions, many of them certified by the Southern Association of Colleges and Universities of the United States. The availability of young technicians trained at local institutions, including the new regional textile university in San Pedro Sula which will soon offer training in electronics A multitude of training programs provided to employees by their companies

5) Emerging business sectors:

In traditional sectors, such as agriculture, textiles and tourism In value-added industries, including agribusiness, sustainable tourism, light manufacturing and business services A flexible manufacturing sector, capable of exporting in varying scales, supported by a favorable tax and customs code A growing services sector A tourism sector that attracts international travelers A forestry industry that supplies a wide variety of non-traditional wood species 32 million hectares (80 million survey acres) at highly competitive prices, with diverse climates and a large potential for low irrigation agriculture