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Nicaraguan footwear has duty-free access to the US
Footwear manufactured in Nicaragua can benefit from tax-free access to the United States, as stipulated in the framework of the Free Trade Agreement between Central America, the United States and the Dominican Republic (DR-CAFTA).
The general rule applies to the majority of footwear and establishes that the product should be assembled in the DR-CAFTA region to benefit from the tax-free access to the United States, meaning a shoe assembled in Nicaragua with raw materials from any other country qualifies to benefit from the preferential access.
In the same way, Nicaragua has free trade agreements with Mexico, Panama and Chile, as well as an Association Agreement with Central America and the European Union. Therefore, footwear made in Nicaragua has duty-free access in each of these countries.
Although Nicaragua has a long tradition of artisan footwear manufacturing, 2010 marked the beginning of industrial production and high-volume exports of fine leather footwear towards the United States and the European Union markets, as a result of the beneficial trade preferences that exist. Currently, the main export destinations are the United States, Costa Rica and Panama.
In 2012, the country reached its highest historical figure in terms of footwear exports with the amount of US$37.5 million, considering both the traditional fiscal regime and the special free zone regime.