A ‘HUGE’ Opportunity: Nearshoring To The Northern Triangle

WASHINGTON — October 14, 2022 — American companies ready to invest in the Northern Triangle countries of Central America view fair incentives, security and skilled labor as important considerations when moving their investments from Asia or expanding those already present in the region.

During the Annual Meeting of the HUGE Business and Investment Council in Washington this week, companies such as Houston Airport System, UPS, Hilton, Kroll, expressed their intention to explore opportunities offered by Honduras, El Salvador, and Guatemala to open new businesses. Companies already there, including Fruit of the Loom, SanMar, Elcatex, Parkdale Mills and Crowley, are aiming to expand.  They asked the United States to accelerate the support from DFC and discussed the role of multilateral development banks and private investment funds as an important source of funding.

HUGE reiterated its long-held position that the CAFTA rules of origin be maintained to support the development of a vertically integrated textile industry in the Northern Triangle that is linked to the U.S. market. CAFTA is now driving significant new investment towards this goal, and if the rules of origin change, those investments will not come to the region.

“Having clear and predictable rules of the game is essential to attract investment to the countries of the region. We at the IDB are ready to support it with financing and technical assistance to achieve this,” said the new Interim President of the Inter-American Development Bank, originally from Honduras, Reina Irene Mejía, at the opening of the HUGE Annual Meeting.

“Crowley has served the U.S.-Central America trade for many decades, and we are constantly investing in our people, assets and technology to provide the best end-to-end services to our customers. We work with governments, business partners and communities to advance nearshoring as a supply chain solution for customers that also provides value to those countries and their people,” said Crowley Chairman and CEO Tom Crowley. “Fair incentives to encourage expansion of operations, new investments and beneficial trade is an economic multiplier,” Mr. Crowley added.

In addition to the projects HUGE announced last year, three new projects were presented. In Guatemala, Synergy Industrial Park and Numa Industrial Park are two free zone projects with important technical training components. In Honduras, the innovative renewable energy project La Vegona II will generate 1,200 MW through pump-storage technology.

Altogether, HUGE has mobilized more than $3.2 billion in new investments, which will generate more than 200,000 new jobs. “Supporting long-term development in Northern Central America requires more than just U.S. government funding.  As Under Secretary, I have met many HUGE member companies. I have seen your positive impact, both on the U.S. economy and in the region.  We support your goal to mobilize $10 billion in investment to create 2 million new jobs over the next 5 year and applaud your 10 new projects for $3.2 billion that will create over 200,000 jobs”, said U.S. Under Secretary of State Jose Fernández to attendees from all four HUGE countries.

Foreign investments and financing are key, which is why the World Bank, IDB, and CABEI were all present at the HUGE Annual Meeting. Bernardo Yurrita of Banco Industrial de Guatemala and Camilo Atala of Grupo Financiero Ficohsa applauded the role of development banks and investment funds, as financial inclusivity is essential for small, medium, and microenterprises, as well as businesses owned or led by women.

“HUGE Founders are eager to continue to build on the momentum generated thus far. The transformation of our region is possible, and we will achieve it. Now is the moment!” said Dr. Juan José Daboub, president of HUGE.

Posted: October 14, 2022

Source: HUGE Business and Investment Council