Once well known for the quality and design of its leather shoes and leathergoods, the Nicaraguan leather industry is said to be on the verge of collapse due to the severe shortage of raw materials resulting from the extensive export of the country's wet-salted hides, mainly to Mexico.

According to industry sources, tanners are being forced impose compulsory vacations on their employees and many companies, both tanneries and manufacturers, have been forced to close.

The problem is said to be due to the government’s non-compliance with Law 223 that defines the country's policy for the promotion and protection of the leather and footwear industry which states that “the Ministry of the Economy and Development (MIFIC) must ban leather exports whenever the sectors affected claim that the unavailability of raw material is damaging the country's economy”.   

Although the MIFIC agreed to ban exports of low added-value hides and deemed that slaughterhouses must assign 30% of hides to the domestic market at a meeting with industry leaders at the end of May, members of the industry remain concerned that the measures outlined to protect the industry have not yet been implemented.