The excess inventory has affected them in the suspension of new orders from client companies and has caused the cut of some 2.500 jobs.

The textile and clothing sector of El Salvador is still suffering the impact of the reduction in orders from its main clients in the United States, which could mean a 10% drop in its exports by the end of 2023.

According to data from the Central Reserve Bank, exports from the sector reported a value of US$615.3 million in the first quarter of the year, which is equivalent to a decrease of 14% compared to the same period last year.

According to Patricia Figueroa, executive director of the Chamber of the Textile, Clothing and Free Trade Zones of El Salvador (CAMTEX), this result "is what was already expected" and is due to the issue that since last year "there was an oversizing on the part of the brands what was going to be the demand for the product and this has been having a snowball effect of excess inventories”.

Figueroa considers that this situation will continue the same for the remainder of this year, which has affected manufacturing companies that have had to suspend some 2.500 direct jobs due to the lack of new contracts.

Given this panorama, the union leader estimates that "there will be a slight decrease" in exports and although she says that it is difficult to project how it will close this year "because there are many variables influencing", but "it could fall by 10%".

“Very likely, we are going to have a decrease due to everything that is happening in the world and we are also going to depend on the rearrangements that all the industries generate internally, but the issue of inventories continues to exist so, as an optimist, I think we could reach to tables," he said at a conference.

The BCR reports that last year El Salvador exported textile merchandise worth US$2.751 million, which represented 4% more compared to 2021. Cotton T-shirts, synthetic jackets, and sweaters were the main products shipped to the United States.

To promote new contracts and investments in the country, CAMTEX has held several meetings with important brands and government representatives from the United States so that there are incentives for regional companies and US companies to expand and bring new projects.

Source:
https://www.estrategiaynegocios.net/empresasymanagement/textileros-de-el-salvador-esperan-caida-de-10-de-sus-exportaciones-este-ano-MO13488073