Nicaragua - Industry

Nicaraguan industry expanded during the 1970s but was severely disrupted by the civil war and nationalization in 1979. In 1980, the manufacturing sector began to recuperate, and modest growth continued through 1984. In 1985, however, net output again declined, by an estimated 5%. In the mid 1980s, there were still many state enterprises, some of them created by nationalization; in 1985, the government announced plans for a mixed economy. All state monopolies except for public utilities have been eliminated; price controls have ended; and more than 300 state enterprises have been privatized since 1990. As of 2002, the state telecommunications company, water and sewage, and energy companies were due to be privatized.

In 2000, the industrial sector contributed approximately 23% to the GDP and employed approximately 15% of the labor force. Among the most important industries are processed food, chemicals, metal products, textiles, clothing, petroleum refining and distribution, beverages, and shoes. Nicaragua has one oil refinery with a production capacity of 20,000 barrels per day. The services sector has become the major player in the country's economy since the reforms instituted by the Chamorro government. Services account for 44% of GDP and include commerce, financial services, transportation, energy and construction.

The construction sector rebounded after the destruction wrought by Hurricane Mitch in 1998, but slowed in 2000. The building of shopping centers and hotels, the industrial production of meat and poultry, and the development of transportation and communications were all growth sectors in 2003. Manufacturing in free trade zones rose 22.9% in 2000 to $250 million. Manufacturing overall accounted for around 20% of GDP, and grew 2%.