(qCOSTARICA) Operating in the country since 1987, Rawlings, the manufacturer of balls for Major League Baseball (MLB) in the U.S., announced Tuesday it is shutting down its uniform manufacturing plant in Turrialba.
As a result 200 the 650 people the company employs in Costa Rica will be out of work.
According to Rawlings general manager, Alejandro Cotter, the closing is an issue of competition, since they were able to outsource the manufacture of uniforms in El Salvador.
“It is not a national (Costa Rica) problem, but worldwide,” said Cotter, adding that the plant closure is inevitable.
The uniforms made in Costa Rica (soon in El Salvador) are used by minor league soccer players in the United States.
For the company, Costa Rica is more competitive in the services sector. In contrast, El Salvador offers a more developed textile industry, with the production of yarn and fabric and manufacturing facilities.
According to Cotter, El Salvador is more cost-effective, with a higher manufacturing volume.
Cotter said employees were notified last week and the company will not focus on making balls at its plant located in Las Americas in the community of Turrialba, with its remaining 450 people
Cotter explained that the company will be working with the Coalition for Development Initiatives (CINDE) to help the laid off employees find new jobs when the plant will shut down in September.
Following Rawlings maybe other textiles companies operating in the country.
According to data from the Promotora del Comercio Exterior (Procomer) – Costa Rica’s foreign trade promoter – the value of Costa Rican textile exports fell 45% between 2011 and 2015, reflecting a sharp contraction in the sector. Procomer says sales dropped from US$118 million in the first six months of 2011 to US$64 million in the first half of this year.
Comparing annual data, sales in 2010 was US$224 million, dropping to US$147 million last year.
The decline in the sector had been dramatic. In 2000, for example, sales reached US$729 yearly.