Footwear production in Nicaragua is set to rise by 11% this year as the country continues to increase its foothold in the US market.

Around 1,200 small and medium size enterprises (SMEs) dedicated to footwear manufacture in Nicaragua are expected to have produced 2m shoes by the year-end, 200,000 more than in 2012.

During 2005, Nicaraguan SMEs produced 1.2m shoes and in 2012 production reached 1.8m.

The country first began producing high volume export-quality shoes in 2010, and has been marked as a supplier to watch, along with Cambodia and Bangladesh.

According to ProNicaragua, the country's investment promotion agency, 70% of footwear operations are located in Granada and Masaya, while 10% are in Estelí and another 10% in Managua.

Manufacturers in Masaya recently received training to help improve the quality of their products and their competitiveness in the Central American market.

The main items produced are footwear with leather uppers, synthetic sandals, rubber boots and safety boots for construction. And the main export destinations are the US, the European Union, Costa Rica and Panama.

In 2011, US$35.3m was generated by the sector, and in 2012 this rose 6% to US$37.5m.

Among the country's strengths as a footwear supplier are its proximity to the US, the world's largest consumer market (ships reach southern US ports within three to five days), and duty-free access under the Dominican Republic-Central American Free Trade Agreement (DR-CAFTA).

Nicaragua also enjoys preferential market access to the European Union (EU), while the Association Agreement between the EU and Central America, which came into effect in August this year, will eliminate tariffs on footwear exports.