While there has been significant progress in diversification efforts, the United States remains in an essential position.

In 2024, DR free zones maintained their heavy reliance on raw materials from the United States, which constituted 61% of their total inputs. The United States maintains its leading role by sustaining the operational base of the Dominican Republic’s export-driven industrial sector, which demonstrates their historical commercial partnership.

The latest CNZFE report contains data that demonstrates significant changes in the sources of inputs used by companies in DR free zones. The unchanged U.S. leadership position exists alongside global sourcing shifts that drive procurement strategy changes through diversification and realignment.

The United States: A Critical Link in the Supply Chain

The data showing that 61% of imported raw materials came from the United States in 2024, while China supplied only one-sixth of that amount demonstrates a significant reliance that presents both benefits and potential disadvantages. The combination of geographic closeness and robust diplomatic relationships with established trade frameworks like CAFTA-DR has resulted in a reliable trade infrastructure between the two countries. The substantial concentration of imports creates risks regarding the potential effects of trade policy changes or supply chain interruptions, as well as currency volatility.

A total of 579 companies in DR free zones sourced raw materials from the U.S. in 2024, which represents an increase of 11 companies from 2023. The steady increase reflects both consistent trade patterns and growing trust in U.S. supply channels. Even with ongoing talks about diversification and nearshoring to other regions, the United States continues to be the fundamental element of the free zone supply chain.

China and Italy: Significant Players, Diminished Momentum

China secured the second position with 10% of imported inputs, while Italy came in third with 9.1%. The operational activity of China declined significantly while Italy maintained its position without major changes. The number of companies sourcing from China decreased from 581 in 2023 to 497 in 2024, resulting in a decline of 84 companies. The significant reduction in sourcing activity from China represents concerns about rising freight costs and instability in Asia-Pacific trade routes, along with efforts to diversify suppliers.

The top tier of sourcing destinations comprised Puerto Rico at 3%, along with a group of diverse countries, which included Ecuador at 1.8%, Mexico at 1.4%, Germany at 1.2%, and Honduras at 1.0%.

The use of domestic sources is growing but remains relatively small in scale.

The rise in local sourcing during 2024 represented a potentially strategic development. The Dominican Republic sourced raw materials only make up 0.4% of total raw materials, but companies buying local inputs increased from 209 in 2023 to 234 in 2024, which represents a 25% rise. The current trend reflects endeavors to integrate domestic operations within the free zone ecosystem, which may lead to industrial symbiosis, minimized logistics expenses. and reinforced economic resilience.

The Dominican Republic’s raw material sourcing stands alongside the Philippines, Turkey, and the Netherlands, yet falls short when compared to regional countries Guatemala, Costa Rica, and Haiti, which each have 0.3%.

Diversification and Emerging Supply Hubs

Free zones in the DR are increasingly pursuing alternative supply markets based on emerging evidence. The number of supplying companies in Sri Lanka grew substantially from 22 in 2023 to 79 by the following year. Thailand has gained relevance by adding 14 companies, while Turkey and Guatemala both increased by 10 companies, and the Czech Republic added 8 companies. Companies adjust their supply chain approaches to emphasize supplier flexibility and risk mitigation alongside cost-efficiency as part of global supply chain strategy evolution.

In contrast, some countries lost ground. Canada experienced a reduction of 29 companies, while Taiwan faced a decrease of 16 companies, next to Japan’s 17 company loss, and El Salvador’s 12 company reduction, with Chile losing 11 companies and Pakistan seeing a nine company decline. The reasons for these changes include variations in shipping fees, diplomatic relationships, product standards, and other logistical factors.

The category for “other countries,” which represents 2.1% of total inputs, saw a slight decrease from 213 to 194 companies, indicating a tendency towards industry consolidation instead of expansion in diverse sourcing.

Sectoral Growth and New Investments

The uninterrupted expansion and vibrancy of DR free zones benefit from data sources that extend beyond raw material procurement. The Dominican Republic approved 74 new companies for operation under its free zone regime during 2024. The projects should create 7,086 direct jobs, while drawing US$196 million in investments and US$103.1 million in foreign exchange.

The Dominican Republic has proven to be an increasingly appealing location for manufacturing and services due to its stable political environment, cost-effective labor market, advantageous trade deals, and enhancements in logistics infrastructure.

Tobacco and its derivatives emerged as the top subsector among new entrants with 18 new companies joining the market. Other growing segments included:

• Call centers (15 new companies)
• General services (8)
• Apparel and textiles (6)
• Electrical and electronic products (5)
• Medical and pharmaceutical goods (4)

DR free zones now feature a diverse range of industries because they have expanded beyond their traditional focus on textile manufacturing.

Infrastructure, Services, and Institutional Contributions

Businesses operating within DR free zones serve as significant supporters for both public service structures and national institutions. Free zone companies spent RD$23.35 billion on multiple services in 2024.

• Social security: RD$14.77 billion
• Electricity: RD$6.41 billion
• Telecommunications: RD$1.34 billion
• INFOTEP (training and development): RD$613.7 million
• Water supply: RD$218.1 million

The sector demonstrates its extensive contribution to national socio-economic development by creating jobs and exporting goods, alongside supporting public service stability and developing human capital.

Free Zones in DR play a strategic role in the country’s development process

The Dominican Republic’s industrial and export capacity now relies heavily on DR free zones, which have transformed into essential operational hubs over the past several decades. Free zones in the Dominican Republic generate over 190,000 direct employment opportunities, while accounting for 60% of the nation’s export volume and driving innovation alongside logistics and trade activities.

The sector’s performance during global shocks such as the COVID-19 pandemic and recent geopolitical trade disruptions proves its ability to remain strong and adjust to changes. By diversifying its sourcing patterns and maintaining strong connections with the United States, the Dominican Republic creates advantageous conditions for deeper involvement in global value chains.

Conclusion: Balancing Dependence with Strategic Flexibility

The Dominican Republic’s free zone sector demonstrates healthy growth alongside prudent diversification and strategic investment as of 2024. The Dominican Republic benefits from its dependable U.S. raw material supplies but must seek other suppliers to ensure its economic resilience.

DR free zones maintain their powerful status as tools for economic development and industrial transformation in the Caribbean through expanded domestic sourcing practices and relationships with emerging supply hubs like Sri Lanka and Thailand, as well as special incentives for high-value industries.

As more firms enter the industry and supply chains evolve toward greater flexibility, the Dominican Republic stands ready to improve its position in international manufacturing and services markets.

Honduras has become the key location for export-driven manufacturing and logistics activities in Central America. Honduras’ extensive industrial parks, combined with its business-friendly policies and CAFTA-DR market access, make it a prime location for multinational companies pursuing nearshoring options. ZIP San José International Free Zone, along with Green Valley Industrial Park, ZIP Choloma, and Altia Business Park, distinguish themselves through top-notch infrastructure, strategic placement, and extensive support services. This analysis investigates industrial Parks in Honduras by evaluating market access, supplier logistics, labor conditions, infrastructure quality, regulatory advantages, and cost structures.

Key Industrial Parks in Honduras

Green Valley Industrial Park offers advanced facilities for textile and apparel production, along with advanced manufacturing, and is situated near Villanueva and San Pedro Sula. The park achieves worldwide compliance and sustainability standards through its internal customs office, powerful internal electrical grid, and integrated water treatment systems.

The International Free Zone in San Pedro Sula stands as one of Honduras’ oldest and top-performing industrial parks. Grupo ZIP developed an industrial park that covers 1 million square meters and accommodates global clients from the textile, electronics, and automotive component industries. This industrial park in Honduras provides access to Puerto Cortés deep-water port along with high-speed fiber optic connections and energy facilities that include backup power generation.

ZIP Choloma hosts numerous textile, consumer goods, and light manufacturing companies and stands near the northern industrial belt. The facility hosts Hanesbrands and Gildan as part of its tenant base, and achieves cluster efficiencies within apparel manufacturing.

Altia Business Park serves business process outsourcing (BPO) and call centers, along with technology companies, by combining advanced office spaces with dependable telecommunications and access to a bilingual workforce of younger people.

The country’s export-driven manufacturing industry depends on industrial parks in Honduras as they create thousands of direct and indirect job opportunities.

Access to Markets, Labor Pools, and Suppliers

The strategic location of Honduras, close to North American markets, provides significant logistics benefits. Most industrial parks exist in the northern corridor near San Pedro Sula, where they have convenient access to Puerto Cortés, which stands as Central America’s only deep-water port with U.S. Container Security Initiative certification. The location operates as a primary export route for products to the U.S., Canada and European markets.

The Ramón Villeda Morales International Airport provides air cargo services, while expanding road networks enable connections between parks and border regions with Guatemala and El Salvador. Textiles and plastics suppliers operate within a few hours’ travel distance, which facilitates just-in-time delivery services.

Industrial parks in Honduras gain an advantage because they can tap into a workforce of 4.8 million people who are of working age and possess relevant manufacturing and services skills. San Pedro Sula, along with La Ceiba and Tegucigalpa, provides strong labor markets with young workers who are trainable and can be hired at affordable rates.

Labor Availability, Costs, and Regulations

Labor Availability and Costs: Honduras maintains a steady flow of industrial workers from its youthful population. The average monthly manufacturing wage in the region spans $350 to $450 as of 2025 and varies according to worker skill level, which results in highly competitive labor costs. Standard benefits packages offer workers transportation services alongside meal subsidies and mandatory social security contributions.

Labor Laws and Union Activity: Honduran labor regulations require companies to provide an 8-hour workday, together with a 44-hour maximum weekly limit, alongside overtime compensation. Employees receive both the 13th and 14th-month bonuses along with vacation time as part of their benefits. The presence of union activity in public and big manufacturing sectors does not disrupt industrial parks, which follow clear operational guidelines and maintain stable labor relations. Special regulatory regimes operate free zones by promoting harmonious labor negotiation processes.

Training and Human Capital: Honduras’ industrial park companies receive support through their collaboration with technical institutes, including INFOP (National Institute for Professional Formation), Zamorano University, and private training centers. Support for BPO and technical industries is available through bilingual training and IT courses.

Tax Incentives and Regulatory Environment

Free Zone Benefits: The majority of Honduras’ industrial parks function according to the Free Zone Law or ZOLI (Zona Libre) regime, which offers:

• Businesses can receive total income tax exemption for a period of up to two decades.
• Import taxes and VAT exemptions apply to machinery as well as raw materials and intermediate goods.
• Simplified customs procedures and expedited on-site inspections
• Exemption from municipal taxes

The National Investment Council (CNI) regulates these zones while registration and compliance procedures remain centralized and streamlined.

Ease of Doing Business: Honduras has made progress toward streamlining business creation processes while also enhancing electricity access and cross-border trade operations. Foreign investment receives government support, while bilateral investment treaties exist with multiple countries. While bureaucratic processes and security challenges continue to exist. industrial parks offer private sector-led support to address these problems.

Environmental Regulations: National environmental laws require industrial parks in Honduras to establish proper water usage systems and waste management processes. Green Valley park maintains ISO-certified water treatment and waste management systems, which fulfill international guidelines for environmental protection and corporate responsibility.

Lease, Construction, and Operating Costs

Lease Costs: Industrial parks in Honduras charge an average monthly lease rate between $3.80 and $6.00 per square meter, based on various factors such as location and building features. High ceilings and fire protection systems in Class A facilities generate premium pricing.

Construction Costs: The cost to construct industrial facilities in Honduras ranges from $400 to $600 per square meter based on the materials used and the energy and design complexity requirements. Industrial parks provide built-to-suit facilities alongside expedited construction schedules.

Operating Costs: Basic operating costs include:

• Energy: Honduras industrial parks receive special electricity rates while gaining access to grid power, as well as privately produced renewable energy. The cost of energy ranges between $0.14 and $0.18 per kWh, which varies according to the amount of energy used and the time of usage.
• Water and Waste: Advanced water treatment facilities, such as Green Valley’s, incorporate waste management costs into their common area maintenance (CAM) fees. The average monthly CAM fees span from $0.35 to $0.75 per square meter.
• Security: Standard on-site security comes as part of CAM charges. Parks maintain secure environments with continuous surveillance operations, biometric entry systems, and secure perimeter fencing.

Logistics and Freight Costs

Honduras delivers cost-effective logistics solutions, because of its geographic location and infrastructure development. Key considerations include:

Domestic Transport: Transporting a 20-foot container from San Pedro Sula to Puerto Cortés (approximately 60 km away) costs between $200 and $400.

Port Freight: Freight export costs from Puerto Cortés to U.S. Gulf Coast ports range from $1,200 to $1,800 per 40-foot container based on destination and shipping carrier.

Air Freight: The San Pedro Sula airport serves as an export channel for light goods and urgent shipments. Sending goods by air to Miami costs around $2.50 to $3.00 per kilogram.

Industrial parks in Honduras operate with high cost-efficiency due to their competitive logistics expenses.

Tenant Mix, Clusters, and Track Record

Various industries receive support from industrial parks in Honduras.

Apparel and Textiles: The apparel and textile market in the northern corridor of Honduras is dominated by Gildan alongside Hanesbrands, Fruit of the Loom, and Delta Apparel.

Automotive Components: Automotive component manufacturers Lear Corporation, Aptiv, and Yazaki, gain advantages from the region’s free trade policies and efficient labor practices.

Medical Devices and Electronics: The medical device and electronics sectors are expanding in smaller clusters throughout San Pedro Sula and Tegucigalpa, where companies like Medtronic conduct assembly subcontracting.

The clusters deliver benefits for supply chains while minimizing lead times and allowing companies to share knowledge. The industrial parks provide co-location advantages through shared service providers and recruitment centers alongside logistics hubs, which lead to increased efficiencies.

International businesses operating in this country experience stable workforce levels, together with consistent operational expenses. Green Valley and ZIP San José parks provide over twenty years of expertise in assisting global supply chains for North American brands.

Conclusion

Foreign investment in manufacturing and logistics sectors finds a strong opportunity within industrial parks in Honduras. The nation provides scalable and budget-friendly solutions within its favorable regulatory setting, through the mature infrastructure of the International Free Zone and advanced facilities at Green Valley and Altia Business Park. Honduras stands as one of Central America’s leading industrial site selection destinations, because of its skilled workforce, alongside competitive pricing and close access to major markets supported by extensive incentive programs. The industrial parks in Honduras provide essential groundwork for sustainable operations through sector-specific clusters, export benefits, and tailored facility development.

Brazil’s rise to prominence in the international aerospace market is due to deliberate strategic choices. The combination of long-term strategic investments, with effective state policies and high-tech development, enabled Brazil to secure a position in one of the world’s most advanced and competitive sectors. Embraer stands at the transformation’s core as Brazil’s leading aerospace corporation and the third-largest commercial aircraft manufacturer worldwide. Marcos Barbieri Ferreira, an aerospace industry expert, observes that this development demonstrates Brazil’s larger goal of combining economic productivity with geopolitical influence through its distinctive role in high-technology industries.

Embraer: The Cornerstone of Brazil’s Aerospace Success

Since its establishment in 1969 and operating from São José dos Campos, São Paulo, Embraer represents Brazil’s industrial strength. This city stands as Latin America’s top aerospace hub where numerous engineers, researchers, and aviation specialists have been cultivated. Embraer’s achievements extend beyond its size and production capabilities, because its success comes from understanding worldwide market demands and delivering dependable solutions across multiple aviation segments through complex aircraft system design and integration.

As a top executive aviation company worldwide, Embraer excels with market-leading aircraft like the Phenom 300 and Praetor 600, which dominate their respective categories. NATO member countries trust the KC-390 Millennium tactical military transport aircraft, which reinforces Brazil’s advanced defense technology capabilities. The accomplishments of Brazilian aerospace companies demonstrate that this country’s aviation sector has achieved global recognition as a major player. These achievements serve as a testament to the resilience and adaptability of the Brazilian aeronautical industry, which continues to gain traction on the global stage.

The Role of Strategic Technological Development

The University of Campinas’ Professor Barbieri Ferreira emphasizes Brazil’s independent capacity to advance aerospace technologies alongside establishing critical international partnerships. The method employed fortified national manufacturing sovereignty and created opportunities to secure components and specialized technology through relationships with dependable foreign partners. The strategic equilibrium between self-reliance and international cooperation has allowed Embraer and the Brazilian aeronautical industry to adapt and stay competitive amid global industry changes.

These partnerships extend beyond traditional Western allies. Barbieri Ferreira highlights expanding partnerships between Brazil and several Global South nations, including China. Growing partnerships with Global South nations create fresh opportunities for market access combined with joint research initiatives and production network expansion. Brazil now enters a new stage of aeronautical diplomacy with South-South cooperation that supports a multipolar approach to global trade and innovation.

A New Frontier: Urban Air Mobility and eVTOLs

Embraer’s urban air mobility subsidiary, Eve Air Mobility, marks a groundbreaking development in Brazil’s aeronautical sector through its introduction to electric vertical take-off and landing (eVTOL) technology. The company aims to transform short-distance air travel into an eco-friendly, cost-effective mode of transportation that serves urban areas. Eve has established operational partnerships across the United States, Europe, and Asia and plans to launch commercial services in 2026.

This investment represents a strategic advancement, which establishes Brazil as a leader in the emerging aerospace innovation era. The anticipated multi-billion-dollar eVTOL could provide the country with enduring competitive benefits through Eve’s early market entry by decade’s end. These developments highlight the forward-thinking nature of the Brazilian aeronautical industry, which is embracing the next generation of aviation technology with agility and foresight.

Sustainability: A National Priority Reflected in Aerospace

Brazil holds the position of Latin America’s largest economy while managing more than half of the Amazon rainforest, which makes it the subject of worldwide environmental responsibility expectations. The aerospace industry faces mounting demands to create sustainable innovation because of its significant ecological footprint. Embraer has made substantial investments in sustainable aviation fuels (SAF) and hybrid propulsion systems while developing aircraft that are lighter and use energy more efficiently.

Barbieri Ferreira states sustainability now stands as a fundamental component of Brazil’s aeronautical industry innovation approach. Embraer’s future roadmap depends on the integration of SAF alongside active research into electric and hybrid propulsion technologies. Brazil establishes itself as a leader in green aviation, which helps reduce emissions while providing a competitive advantage in ESG-focused global markets. The Brazilian aeronautical industry is now poised to lead a sustainability-centered transformation across aviation, setting an example for other emerging aerospace nations.

A Century-Long Policy Commitment

The Brazilian aerospace sector developed its current successes through a state policy spanning almost one hundred years that focused on building technological skills and industrial strength. The Aeronautics Technical Center (CTA), established in the 1950s, laid the groundwork for Brazil’s aerospace sector, which later achieved institutional reinforcement through Embraer’s founding. Brazil’s consistent investments in education, along with research and industrial infrastructure, created optimal conditions that allowed their aeronautical industry to succeed.

The development model of Brazil’s aerospace industry reflects successful frameworks of other leading aerospace countries through strong government-academic-private sector partnerships, which drive sustained growth. The Instituto Tecnológico de Aeronáutica (ITA) stands as a prime institution for aerospace education comparable to MIT in Latin America and remains essential for developing top-tier professionals in the field.

Global Integration Through Competence and Collaboration

The Brazilian aeronautical sector exemplifies how global integration can occur alongside maintained technological independence. Brazil has retained command over its essential skills by dominating high-level production stages like aircraft design and systems integration, yet remains open to international partnerships in subsystems and parts development.

The hybrid business approach has positioned Embraer as a sought-after partner for worldwide aerospace projects and transformed Brazil into a key player in both Latin American and global aerospace markets. The ability of the nation to expand this method across its commercial aviation market, as well as executive and defense sectors, demonstrates the robust nature of its industrial network. The Brazilian aeronautical industry continues to strengthen global alliances while reinforcing its domestic innovation capabilities.

Looking Ahead: Expanding Horizons for Brazil’s Aerospace Future

Brazil stands ready to take advantage of aerospace market expansion across established and new segments. The ongoing achievements of Embraer, and recent developments in urban air mobility and sustainable aviation, demonstrate Brazil’s dynamic and flexible industrial environment. Brazil benefits from government support, along with its educated workforce and rising global demand for medium-range fuel-efficient aircraft.

Brazil has developed expertise that supports worldwide trends, including nearshoring, as well as defense modernization and green aviation. The Brazilian aeronautical industry should maintain its crucial role in national industrial plans and international reputation as partnerships and technologies progress.

Professor Barbieri Ferreira explains that Brazil’s aerospace industry success extends beyond manufacturing aircraft as it also aims to establish a global position through strategic innovation alongside collaborative and visionary efforts. For policymakers, business leaders, and international partners, the message is clear: Brazil’s aeronautical industry goes beyond flight—it’s advancing towards a future filled with potential.

67% of Uruguayans Now Shop Online, and the Sector Represents 2% of GDP

Uruguay has quickly emerged as a primary force for digital commerce throughout Latin America. Due to its strong infrastructure and institutional backing, combined with rising digital literacy rates, the country emerges as a hub for internet-enabled business activities. Recent figures from the Uruguayan Chamber of Digital Economy (CEDU) show that 70% of Uruguayans will be engaged in online shopping by the year 2025, demonstrating the nation’s major transformation. E-Commerce sales contributed to 2% of Uruguay’s Gross Domestic Product (GDP) in the year 2024.

The sector achieved UYU 62.835 billion in revenue (US$1.57 billion in nominal terms), which indicates a 38% growth in the local currency and a 32% increase in real terms from the previous year. The 2024 eCommerce Outlook report by Exante ranks Uruguay as one of the top ten countries globally for eCommerce growth. Uruguay leads eCommerce expansion throughout Latin America and makes its mark in the global digital economy.

Digital Consumption: A Behavioral Shift Across Generations

Digital consumption patterns extend beyond younger generations to affect multiple age groups. Factum’s Digital Consumption Trends in Uruguay 2025 report demonstrates a nationwide behavioral transformation. A new study shows that 67% of people have made an online purchase this year, representing the highest percentage ever recorded.

Online shopping platforms report that 30% of digital consumers complete multiple purchases throughout the year. It is especially significant that fewer Uruguayans remain without any online shopping experience, with older adults steadily breaking through technological obstacles.

Online shoppers choose digital marketplaces mainly because of convenience (27%), followed by practicality (21%), and economic advantages (19%). The attraction of digital commerce in Uruguay stems from its modern image as well as its ability to fulfill actual consumer requirements. The shift in consumer mentality explains why Uruguay leads eCommerce adoption among diverse demographics.

Local Versus International Purchasing Behavior

Local eCommerce platforms are the top choice for consumers in Uruguay. The Factum report reveals that national retailers received purchases from 93% of digital buyers in 2025. The trend reveals consumer confidence in domestic eCommerce services alongside robust local logistics systems.

The same period revealed that 57% of consumers engaged in transactions with international vendors, which demonstrates their dual market orientation towards both local and global platforms. Uruguay leads eCommerce regionally by implementing a balanced and diversified strategy that combines excellent domestic performance with global e-commerce receptivity.

Online Transactions and Preferred Payment Methods

The maturing digital payment ecosystem stands as a significant catalyst for the expansion of eCommerce in Uruguay. The number of online transactions in the country exceeded 55 million in 2024. Credit cards accounted for 74% of online purchases, which demonstrates their dominant role in digital payment systems. The new payment alternatives consisting of debit cards and digital wallets like Paganza, Prex, and MiDinero represented 26% of online transactions, which shows their expanding adoption.

The e-commerce sector now represents 7% of Uruguay’s electronic payments, demonstrating its growing presence in both the nation’s financial and retail systems. The increasing comfort level with digital payments stands as a fundamental element of Uruguayan eCommerce initiatives and drives its leadership position in Latin America.

Mobile Commerce on the Rise

Mobile commerce (mCommerce) has become a key driver of Uruguay’s digital economy. The widespread adoption of smartphones, with penetration rates over 85%, makes mobile platforms the leading choice for eCommerce transactions. Top retailers and service providers have adapted their platforms for mobile use, and many have established dedicated apps to provide better customer experiences.

Users now complete product searches and transactions more frequently on mobile devices compared to desktop computers. The transition towards mobile platforms for eCommerce stands out prominently among young consumers while gaining acceptance throughout every age bracket. The mainstream adoption of mCommerce validates how Uruguay leads eCommerce innovation and access throughout the population.

eCommerce Ecosystem and Government Support

Government initiatives have made substantial contributions to the acceleration of this sector. The national digital agenda of Uruguay demonstrates its dedication to digital transformation by focusing on infrastructure development, along with educaion and cybersecurity initiatives. The Plan Ceibal initiative, along with Antel’s fiber optic network growth, both stand as crucial projects that established the foundation for Uruguay’s prosperous digital economy.

Public-private collaboration has also been key. The organization CEDU has collaborated with government bodies to advance e-commerce, while providing support to entrepreneurs and conducting major industry events like eCommerce Day Uruguay, which fosters business connections and public awareness. This cooperation exemplifies how Uruguay leads eCommerce development through coordinated efforts between the public and private sectors.

Logistics and Fulfillment: Overcoming Structural Barriers

Uruguay’s eCommerce sector continues to face logistical hurdles even in the wake of significant advancements. Further investment is needed to address challenges related to distribution costs and delivery times while improving access to rural areas. Montevideo and Punta del Este’s urban centers enjoy efficient delivery networks, yet rural areas maintain their developmental delays.

Through the adoption of crowd shipping, alongside micro warehousing and last-mile delivery solutions, local startups together with logistics firms aim to bridge existing distribution gaps. Implementation of real-time tracking systems alongside automated customer communication processes leads to better user experiences and operational improvements.

The nation must address present challenges to maintain its growth momentum and maximize the current economic expansion. Overcoming logistical challenges remains essential if Uruguay leads eCommerce into a globally competitive future.

Cybersecurity and Consumer Trust

The growth in online transactions creates a greater demand for enhanced cybersecurity measures. Uruguay shows its commitment to consumer and business protection through its active development of protective frameworks. The joint implementation of the Personal Data Protection Law and the National Cybersecurity Strategy creates a secure basis for digital commerce operations.

Uruguayan consumers display strong trust in online platforms because powerful regulatory protections support them. Maintaining consumer trust during the growth of the eCommerce ecosystem requires sustained investment in cybersecurity technologies, fraud prevention systems, and consumer awareness campaigns. The extensive protective measures in place provide an additional explanation for why Uruguay leads eCommerce across Latin America with an emphasis on reliability and security.

Future Outlook: Innovation and Integration

The development of digital technologies will propel continued growth in Uruguay’s eCommerce sector. Some leading retailers have adopted artificial intelligence (AI), together with machine learning and big data analytics, to create personalized customer experiences while also predicting market trends and managing inventory more efficiently.

More companies are now integrating omnichannel strategies, where digital platforms serve to enhance physical store operations. Retailers utilize click-and-collect services, alongside virtual showrooms and augmented reality tools to create a seamless experience between online shopping and physical store visits.

Uruguayan SMEs can expand their digital operations worldwide through enhanced access to cross-border platforms and trade agreements with major markets.

Conclusion: Uruguay as a Regional Digital Leader

The eCommerce industry in Uruguay has developed rapidly during recent years to become a leading force in regional digital commerce. The country proves that economic transformation can be driven by coordinated policy and innovation alongside consumer readiness through its digital payment infrastructure expansion and the fact that 67% of its population shops online.

The sector will maintain its growth as it overcomes logistical hurdles and regulatory barriers while expanding digital inclusion. Uruguay leads eCommerce with an integrated and visionary approach involving infrastructure enhancement, technological advancement, and market expansion, which neighboring countries should strive to replicate.

Through its development of a durable and inclusive digital marketplace, Uruguay leads eCommerce progression across Latin America with its advanced approach.

Various European companies, particularly from France, are now considering Paraguay as a production location, while they reevaluate their supply chains and production facilities worldwide. The country’s economic stability, combined with competitive production costs and strategic South American location, alongside its appealing maquila regime, make the country an attractive destination. International firms find Paraguay an emerging production destination as these factors influence their decisions on relocating production to Paraguay.

A Strategic Move by French Industry Leaders

The president of the Paraguayan-French Chamber of Commerce, Benoit Libourel, disclosed that numerous leading French firms are currently in detailed negotiations to move their production facilities to Paraguay. The production of tubular structures for greenhouses is one sector currently under evaluation. These companies are studying methods to use Paraguay’s production capabilities and export systems to better access Latin American markets. As supply chain diversification becomes a strategic imperative, relocating production to Paraguay is emerging as a practical and competitive alternative for French manufacturers.

Libourel explained how Paraguay’s landlocked location in South America enables superior logistic connections with major consumer markets like Brazil, Argentina, and Uruguay. French manufacturers that specialize in industrial and agricultural products can use this opportunity to enhance their market reach throughout Latin America.

Paraguay’s Maquila Regime: A Competitive Edge

Paraguay draws its main appeal from its maquila regime, which was created under Law No. 1064 in 1997, and received additional support from Decree No. 9585 in 2000. Under this regime, companies manufacture products and deliver services for export based on agreements with foreign parent companies. Under the maquila system, businesses can import raw materials and equipment without paying duties as long as they export their finished products.

Companies that are relocating production to Paraguay under this framework receive multiple benefits. Among them are:

• Complete exemption from import duties on both their inputs and capital equipment.
• A favorable 1% tax on value-added production instead of standard corporate tax rates.
• Access to competitive, young, and trainable labor.
• Streamlined regulatory processes through the National Council of Export Maquiladora Industries (CNIME).
• A legal framework that attracts sectors such as textiles, electronics, automotive parts, and agricultural machinery.

Energy Abundance and Economic Stability

French businesses find it attractive to relocate their production to Paraguay due to its remarkable energy infrastructure. Massive hydroelectric plants, including the Itaipú and Yacyretá dams, enable Paraguay to rank among the largest exporters of renewable electricity worldwide. The energy resources available provide both a sustainable and stable power supply while maintaining some of the lowest operational costs globally.

Paraguay’s government has maintained low inflation rates relative to neighboring countries through careful fiscal management, which boosts investor trust. The Central Bank of Paraguay projects that stable GDP growth will continue thanks to rising exports, the diversification of agriculture, and industrial growth through maquila production.

A Trade Relationship Poised for Growth

The trade relationship between Paraguay and France is dynamic since the two countries already have strong economic connections. Libourel pointed out that Paraguay delivers a substantial part of the petitgrain oil, which perfumers use and fulfills approximately 40% of France’s needs for this product. The bulk of French exports to Paraguay consists of high-value products, such as cosmetics, machinery, and vehicles.

The existing trade relationship between Paraguay and France has potential for further expansion to achieve a more balanced economic partnership. Relocating production to Paraguay will strengthen the economic relationship between the nations and decrease reliance on distant Asian manufacturing centers. Recent global supply chain disruptions have accelerated the adoption of this strategy.

The EU-Paraguay Investment Forum 2025: A Key Milestone

The EU-Paraguay Investment Forum 2025 will take place in Asunción from June 24–25. It represents a key event organized by Paraguay’s Ministry of Industry and Commerce via Rediex in partnership with the EU’s Global Gateway initiative.

The forum aims to:

• Promote investment opportunities in sustainable industries.
• Facilitate public-private dialogue.
• Create strategic business relationships between firms from Europe and Paraguay.

The forum will focus on renewable energy, green hydrogen, and sustainable forestry, while also highlighting sustainable logistics. These sectors align with Paraguay’s strategic development goals and the European Union’s increased focus on Environmental, Social, and Governance (ESG) criteria.

It will provide project site tours, matchmaking sessions, and roundtable discussions to serve as an ideal platform for companies interested in relocating production to Paraguay.

Sustainability and Responsible Investment

The Forestry and Land Use Portal operated by INFONA (the National Forestry Institute) will demonstrate Paraguay’s sustainable land use initiatives at the forum. The transparency tool attracts responsible European investment by providing dependable data and control mechanisms in forestry projects.

The key principles of French and European businesses—focused on ESG compliance, supply chain traceability, and environmental conservation—align precisely with Paraguay’s development model.

An Ideal Climate for Export-Led Industrialization

Through its maquila regime, Paraguay has achieved export-led industrialization, now drawing considerable investments from Brazil and Argentina, alongside Asian nations that include South Korea. The inclusion of French and other European manufacturers will enhance the country’s industrial diversity and expand its network of international economic partners.

Paraguay currently exports maquila-produced goods primarily to:

• Brazil (around 70%)
• Argentina
• Chile
• The United States

This list of export destinations may expand as more French and European companies begin relocating production to Paraguay, aided by an increasing number of trade and investment treaties.

The Road Ahead: A Win-Win Opportunity

As economic globalization grows, more intricate and regionalized, companies strive to minimize risks through operational diversification. Firms aiming to reach these objectives find Paraguay particularly attractive for operational realignment within Latin America. The combination of the maquila regime, advantageous tax environment, renewable energy access, and strategic location makes relocating production to Paraguay an attractive option.

French companies discover multiple advantages when they move their production facilities to Paraguay that go beyond simple cost reduction. They benefit from:

• Proximity to important, expanding markets throughout Latin America.
• Trade incentives and simplified regulations.
• An alignment with sustainability goals and ESG principles.

 The establishment of an operation in a politically stable and business-friendly setting.

Conclusion

The movement of manufacturing operations toward Paraguay continues to accelerate as progressive European businesses pursue operational efficiency along with resilient and sustainable production solutions. Paraguay is prepared to receive new and broader industrial investment thanks to active support from organizations including the Paraguayan-French Chamber of Commerce, Rediex, and CNIME.

French enterprises evaluating their business strategies find Paraguay ready to function as both a manufacturing center and a strategic ally for constructing robust and sustainable supply chains ahead. Relocating production to Paraguay represents not just a tactical maneuver, but a forward-looking commitment to resilience, sustainability, and regional integration.