Nicaragua

On August 5, 2004, the United States signed the Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR or Agreement) with five Central American countries (Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua) and the Dominican Republic (the Parties). Under the Agreement, the Parties are significantly liberalizing trade in goods and services.

The CAFTA-DR also includes important disciplines relating to: customs administration and trade facilitation, technical barriers to trade, government procurement, investment, telecommunications, electronic commerce, intellectual property rights, transparency, and labor and environmental protection.

The Agreement entered into force for the United States, El Salvador, Guatemala, Honduras, and Nicaragua in 2006. The CAFTA-DR entered into force for the Dominican Republic on March 1, 2007, and for Costa Rica on January 1, 2009.

In 2008, the Parties implemented amendments to several textile-related provisions of the CAFTA-DR, including, in particular, changing the rules of origin to require the use of U.S. or regional pocket bag fabric in originating apparel. The Parties also implemented a reciprocal textile inputs sourcing rule with Mexico.

Under this rule, Mexico provides duty-free treatment on certain apparel goods produced in a Central American country or the Dominican Republic with U.S. inputs, and the United States provides reciprocal duty-free treatment under the CAFTA-DR on certain apparel goods produced in a Central American country or the Dominican Republic with Mexican inputs.

These changes will further strengthen and integrate regional textile and apparel manufacturing and create new economic opportunities in the United States and the region.

U.S.-Nicaragua Trade Facts

Nicaragua is currently our 67th largest goods trading partner with $3.0 billion in total (two way) goods trade during 2010. Goods exports totaled $980 million; Goods imports totaled $2.0 billion. The U.S. goods trade deficit with Nicaragua was $1.0 billion in 2010.

Exports

Nicaragua was the United States' 79th largest goods export market in 2010.

U.S. goods exports to Nicaragua in 2010 were $980 million, up 37.0% ($265 million) from 2009, and up 428% from 1994 (the year prior to Uruguay Round). U.S. exports to Nicaragua are up 57% from 2005 (Pre-FTA).

The top export categories (2-digit HS) in 2010 were: Special Other (articles donated for relief) ($211 million), Machinery ($129 million), Cereals (rice, wheat, and corn) ($98 million), Electrical Machinery ($53 million), and Fats and Oils (soybean oil) ($46 million).

U.S. exports of agricultural products to Nicaragua totaled $239 million in 2010. Leading categories include: rice ($43 million), soybean meal ($36 million), wheat ($32 million), and soybeans ($30 million).

Imports

Nicaragua was the United States' 67th largest supplier of goods imports in 2010.

U.S. goods imports from Nicaragua totaled $2.0 billion in 2010, a 24.4% increase ($393 million) from 2009, and up 1,102% over the last 16 years. U.S. imports from Nicaragua are up 69.8% from 2005 (Pre-FTA).

The five largest import categories in 2010 were: Knit Apparel ($722 million), Electrical Woven Apparel ($296 million), Machinery ($274 million), Spices, Coffee, and Tea (coffee) ($165 million), and Meat (beef) ($105 million).

U.S. imports of agricultural products from Nicaragua totaled $424 million in 2010. Leading categories include: coffee (unroasted) ($163 million), and red meats, fresh/chilled/frozen ($105 million).

Trade Balance

The U.S. goods trade deficit with Nicaragua was $1.0 billion in 2010, a 14.3% increase ($128 million) over 2009.

Investment

U.S. foreign direct investment (FDI) in Nicaragua (stock) was $301 million in 2009 (latest data available), a 13.2 percent increase from 2008.

There is no information on the distribution of U.S. FDI in Nicaragua.

Nicaragua FDI in the United States (stock) was not available in 2009.