The closure of Nestlé plant in Nicaragua contrasts with million-dollar investment in El Salvador and Guatemala 

Photo of author

By LatAm Reports Editor

Although the authorities of Nestle argued in a statement that the closure of operations of their Central American Company of Lacteos S.A. (Prolacsa), which is in Matagalpa is due to the global dynamics, this measure contrasts with the recent investment they made in El Salvador.

On January 23 of this year, the Swiss food multinational Nestlé announced an investment of $10 million in the construction of a new Distribution Center in El Salvador, which will allow greater storage capacity and greater efficiency in its logistics operations, according to the newspaperelsalvador.com.

The general manager of Nestlé El Salvador, Rodrigo Romera, said during the inauguration of the work: “There is no doubt that Nestlé has confidence in the country, we are turning 70 more but we want them to be many more, really El Salvador has had a change and as a company we see that there really is an option for our customers and consumers and thus to form a more prosperous community, it is what Nestlé is looking for.

The cost of investing in El Salvador equals almost the $11 million that Nestlé had invested in Prolacsa between 2018 and 2023. The last investment was made in 2020, when they injected the plant, which are now moving six million dollars to another Latin American country.

The PRENSA was known that among the globable reasons is increased costs in the field of raw material, increased costs in transport, inflation in services, among others, which requires the unification of operations of some production lines. However, while using this excuse, in El Salvador they expand investments.

Maintain distribution center in Nicaragua

What Nestlé did make clear is that in Nicaragua it will maintain its distribution center, as well as some impact programs in the coffee sector, whose purchases represent 13 percent of national production.

The investment they made in El Salvador in the distribution center caused it to become the fourth largest in Central America. The new premises have 27,000 square meters of extension, with outstanding areas for storage and control office, refrigerated camera, maquila, recycling area and lactation room, said the Salvadoran media.

But in addition, about 85 out of 200 jobs from Nestlé have in El Salvador, almost the same number of places that are affected by the closure of Prolacsa. Nastle generates more than 200 direct jobs and a higher number of indirect jobs. The company currently employs more than 4,000 collaborators and works with more than 3,000 suppliers of raw materials, packaging and indirect materials, it was reported in El Salvador.

During the inauguration of the work, the Secretary of Commerce and Investment, Miguel Kattán, said that: See that this company in the last four years has developed such dynamic changes represents the philosophy and idea of functioning of our government. President Bukele, who has been pushing for total and absolute change in the way things are done in our country. It took 66 years for Nestlé to turn around his vision regarding El Salvador, the Salvadoran newspaper said.

Also in Guatemala

At the same time in 2023 Nestlé also announced an investment of 3.7 million dollars in the expansion of its distribution center in Guatemala, where in the last five years it has invested $15 million.

Are we very happy to announce the expansion of our Distribution Center thus consolidating it, as the largest of the company in Central America. Three years ago, Nestlé invested $11.3 million in its initial construction and is now expanding with an additional investment of more than $3.7 million. Ratifying the growth of the company in Guatemala, in Nestlé we continue to bet on Guatemala and the strengthening of our operations in the region. This investment and expansion reflects our commitment to sustainable growth and the boost of the local economy,” said Patricio Astolfi, CEO of Nestlé Guatemala, reported pointguate.com in July 2023.

In addition, we are proud to generate employment in the country, offering new job opportunities and promoting development, the company representative added.

The new center has an additional 4,600 square meters of construction, for a total of 16,000 square meters and a height of 15 meters, according to the newspaper prensalibre.com.

This article has been translated from the original which first appeared in La Prensaa NI