The food service sector relies on local importers and distributors such as supermarkets and convenience stores to bring U.S. goods to their facilities.
THIS REPORT CONTAINS ASSESSMENTS OF COMMODITY AND TRADE ISSUES MADE BY
USDA STAFF AND NOT NECESSARILY STATEMENTS OF OFFICIAL U.S. GOVERNMENT
Required Report - public distribution
GAIN Report Number:
Food Service - Hotel Restaurant Institutional
EUNICE G. ORTEGA,
The 2010 report is still current in 2011. This is the link to the reference previous report:
SECTION I. MARKET SUMMARY
According to the Central Bank of Nicaragua (BCN in Spanish), there was a 3.5 percent
increment in the number of tourists that arrived to Nicaragua. The total number of tourists as of
September 2011 was 781,524, mainly from Central America (58 percent), followed by the
United States (27.5 percent).
Regarding the income generated by those visits, US$256 million dollars were received as of
August 2011, which is 18.8 percent higher than that for the same period in 2010.
The Nicaraguan Institute for Tourism (INTUR in Spanish) reported that in 2010, there were
1,011,251 tourists entering into the country, from which 646,018 arrived mainly via the
borders. They came from the following countries: Honduras 21.2 percent; United States 20.8
percent; El Salvador 13.4 percent; Costa Rica 12.4 percent; Guatemala 7.6% and other
countries 24.5 percent.
Moreover, INTUR added that 28 projects were approved by the Tourist Incentive Board under
law 306 with a total amount of US$134.5 million, from which 77.5 percent comes from foreign
origin. These projects will create more than 7,000 temporary jobs and over 2,500 permanent
The BCN stated that there was a 3.1 percent GDP growth for the second trimester of 2011,
when compared to the same period in 2010. The Government of Nicaragua (GON) credited
this achievement to higher government expenditures (social programs and subsidies), a higher
influx of remittances and a lower contraction of consumer and housing credit.
Total remittances amounted to $587.2 million from January to August 2011; this is basically a
10.3 percent increase for the same period in 2010. Nicaragua receives most of its remittances
from the United States (62.41 percent). The other countries from which Nicaraguans send
remittances are: Costa Rica (19.63 percent), Spain (5.9 percent), Panama (2.02 percent) and
the rest of the world (9.9 percent).
Accumulated inflation reached 4.9 percent in September 2011, which represents an increase
of 4.07 percent for the same month last year. This is attributed to the sliding currency, the
prices for petroleum and food, and also to demand driven pressures.
GDP is expected to grow by 4 percent in 2011. The GON support this projection based on
good prices for the main export products; a growing agricultural and industry sectors;
investment recovery, mainly private investment; higher direct foreign investment (energy,
tourism, agricultural); strong export dynamism and the constant influx of remittances.
SECTION II. ROAD MAP FOR MARKET ENTRY
A. Entry Strategy
These government ministries in Nicaragua regulate food imports:
Ministry of Health
Ministry of Trade along with the Nicaraguan Tax Authority (DGI)
Ministry of Agriculture
The Ministry of Industry, Development and Trade, Standards Office will determine if the
product complies with the labeling requirements, once the product has been registered with
the Sanitation Office at the Ministry of Health.
B. Market Structure
The food service sector relies on local importers and distributors such as supermarkets and
convenience stores to bring U.S. goods to their facilities.
The lodging segment faces significant challenges in the short-term as businesses and
consumers scale back on travel due to higher prices in food and petroleum. Most hotels offer
free breakfasts, Wi-Fi connection, laundry service as well as evening snacks.
C. Sub-Sector Profiles
According to INTUR, there were 611 establishments that provide lodging throughout
Nicaragua in 2010. This represents a 15 percent growth, when compared to 2009. Below you
will see how they are divided by category (Attachment A contains the number of
establishments by department):
NUMBER OF NUMBER OF NUMBER OF
ESTABLISHMENTS ROOMS BEDS
HOTELS 244 5,636 9,161
OTHER LODGING 359 3,095 4,907
APART-HOTELS 8 149 241
TOTALS 611 8880 14309
The hotels are mostly concentrated in the capital, Managua. This is also where the largest part
of the business travelers in Managua stay at: Hilton Princess, Real Intercontinental
Metrocentro and Crowne Plaza Hotel. They are all part of international chains in Central
America and the United States.
In addition to that, there are two recently opened medium size hotels: Hotel Barceló Managua
and Hotel Express. They offer cheaper rates and are conveniently located near downtown
Managua and close to the international airport, respectively.
The Association of Small Hotels in Nicaragua (HOPEN in Spanish) has 76 members. Ms.
Sandra Mejía, President of Hopen, stated that the average occupation of these hotels is 80
percent in Managua, and 60 percent in other departments, which is slightly higher than last
year. Around one third of the small hotels are based in Managua but they are present
throughout the country.
The following are U.S. franchises operating in Nicaragua and the number of outlets they have:
Subway (11), Pizza Hut (7), Burger King (6), McDonalds (5), Domino’s Pizza (2), Papa John’s
(2), Quiznos (1), Sbarro (1), and TGI Friday’s (1).
The franchises with more expansion are McDonald’s and Subway. In the case of McDonald’s,
they have the same-store deals for both domestic and international operations. They offer the
same products at the same time in Central America. It is also aggressively promoting and
bringing the latest toys in the kids’ value meals. It is now introducing Angus burgers and some
desserts. They are very well-liked in Managua.
In the case of Subway, they are focusing heavily on value meals as competition has
intensified. They have the promotion of the sandwich of the day in which the price is always
Regarding local restaurants, Tip Top is the most popular fried chicken restaurant in Nicaragua
with over 30 outlets. There are other restaurants that are highly recommended by
Nicaraguans: Rostipollos, Pollo Estrella, Los Ranchos, Pizza Valenti’s and Cocina de doña
With regards to the private sector participation in the HRI division, convenience stores also
hold some good opportunities for foodservice providers. They continue to expand their supply
of goods and now include coffee, sandwiches, chicken and pizza, as more affordable
alternatives to some restaurants. The convenience stores that are part of the fuel stations
have become very popular.
The GON is aware of the need of improving local infrastructure, especially in rural areas.
Therefore, it requests donations from other countries to finance its needs. One major tourist
attraction is the San Juan River. That is why the Ministry of Transportation and Infrastructure
(MTI) started the construction of a bridge that will have 360 meters long at Río San Juan at the
border with Costa Rica. This is financed with a donation from Japan in the value of $30
millions. It will be completed by the year 2014. According to the Minister, this project will
simplify the transportation of goods in this region.
There are several tourist attractions in Río San Juan: Blue Lagoon, Esperanza Verde Natural
Reserve, Indio Maíz Biological Reserve, Refugio de Vida Silvestre Los Guatuzos, Fortress of
El Castillo, among others.
In addition to that, the Ministry of Infrastructure will receive a loan of US$35 million from the
World Bank to improve roads in the following departments: Granada, León, Managua,
Matagalpa and Rivas. This project will connect rural areas with the capital, boost economic
expansion with the creation of jobs and strengthen transparency in the transport sector.
In another effort to encourage tourist visits, INTUR created the “Routes” to promote local
attractions. One of them is the “Coffee Route” which includes the northern departments of
Estelí, Jinotega, Madríz, Matagalpa and Nueva Segovia. With donations received from
Luxembourg, this government entity will start the second phase with a total of US$9,183,600
for a project that includes strengthening local capacity, participation in workshops and training,
registration of tourist enterprises, development of municipal plan and tours to natural reserves.
Likewise, the current government administration is using the logo “Nicaragua… Unica,
Original” to market the country as a tourist destination. This is an example of how important
the HRI sector has become in terms of generating income to the second poorest country in
There are three main supermarket companies in Nicaragua. The largest chain is Wal-Mart
Nicaragua which is owned by Wal-Mart México and Central America. They have three
supermarket formats: La Unión (8 outlets), Palí (58 outlets) and Maxi Palí (1 outlet). The first
format aims to attract middle to upper class with air conditioning, credit cards billing and
reasonable prices. In addition to that, these outlets always close late in the evenings. The
second and third format aims to attract the low to middle class segments in Nicaragua with no
air conditioning, no credit cards acceptance and low prices.
The second main supermarket company is La Colonia, which is owned by Nicaraguans. It has
13 outlets in Managua and 3 out of Managua (Matagalpa, Granada and Chinandega).
The third main supermarket company is PriceSmart, which is a supermarket format created in
Panamá with U.S. capital. There is only 1 outlet in Managua.
In the case of supermarkets, there has been an expansion in the number of outlets in
Nicaragua since 2004. For instance, la Colonia went from 7 to 16 outlets and Wal-mart went
from 33 to 67 outlets. This means that the number of outlets for these two chains has doubled
in seven years.
There is a local airline company, La Costeña, which connects the Pacific and the Atlantic
Coast in Nicaragua. Even though infrastructure in general is poorly developed or maintained,
Nicaragua has great natural scenery to offer to all kinds of tourists including 7 percent of the
INTUR added that 49 cruises arrived to Nicaragua with 37,229 passengers. 17,040 cruise
members participated in tours to the country side.
SECTION III. COMPETITION
According to Customs (DGA in Spanish), the United States continues to be Nicaragua’s
leading trading partner in 2011. Imports from Nicaragua’s top three suppliers total US$
713,202.45, which is 21.1 percent of total imports, from the U.S., followed by US$ 654,841.75
from Venezuela, and US$ 323,849.08 from China.
Great quantities of U.S. products are available in Nicaragua. Specific beef cuts, pastas, liquor,
fruits, vegetables, and seafood are among the top imports directed to the HRI industry.
Due to globalization and to the fact that many Nicaraguans live in the United States, the
majority of the population prefer the quality of the products that come from North America.
This is a window of opportunity to the HRI sector to bring more goods that are appealing to the
On the other hand, one of the challenges for the HRI sector is higher prices for food and
petroleum. This segment could be hurt as consumers spend more money filling their gas
tanks and paying for the basic services. Moreover, transport costs for deliveries could become
much more expensive, and many distributors may end up transferring these extra costs to the
In addition to that, the GON is subsidizing the energy bills with assistance from the
Venezuelan Governments. For next year, the GON is forecasting an increase of 12 percent in
the electricity bill.
SECTION IV. BEST PRODUCT PROSPECTS
According to the BCN, there is an increase of US$46.5 millions of imports related to consumer
goods, when compared to the same period January – August 2010. The products for which
there has been a higher demand in recent years are:
Regarding bulk imports, the top four products are: wheat, coarse grains, rice and soybeans.
Below you will find the Nicaraguan food imports from the United States in bulk:
Jan - Oct Jan - Oct
P Value in Value in Value in % artner Product
dollars dollars dollars Change
31,812 25,519 51,994 104
Nicaragua Coarse Grains
22,216 17,050 39,160 130
43,422 41,794 21,994 -47
30,263 30,263 3,911 -87
Source: Global Agricultural Trade System / BICO Report
SECTION V. POST CONTACT AND FURTHER INFORMATION
Agriculture and Rural Development
Ministry of Agriculture and Forestry
National Forestry Institute
American Embassy Managua
Branches of Government
Central Bank of Nicaragua
Nicaraguan Institute for Tourism
Ministry of Transport and Infrastructure (MTI)
Nicaraguan Tourism Institute
Office of the President
Supreme Electoral Council
Association of Consumer Goods Distributors
Association of Producers and Exporters of Nicaragua
Chamber of Commerce of Nicaragua
Chamber of Industries of Nicaragua
Directory of Nicaragua’s Small Hotels
Superior Council of Private Enterprise
Ministry of Health
Nicaraguan Tax Authority
Trade and Investment
Export Transaction Center
Ministry of Development, Industry, and Trade
National Free Trade Zone Commission
ProNicaragua – Investment Promotion Agency
NUMBER OF NUMBER OF NUMBER
ESTABLISHMENTS ROOMS OF BEDS
Managua 146 3,361 5,360
Rivas 71 931 1,440
León 64 632 1,271
Granada 57 695 1,166
RAAS 47 483 616
Matagalpa 36 458 801
Estelí 26 184 371
RAAN 26 372 472
Chontales 24 350 439
Masaya 21 237 486
Chinandega 21 279 444
Jinotega 21 244 319
ATTACHMENT A – INTUR 2010
Río San Juan 20 201 418
Carazo 12 138 210
Boaco 9 125 176
Madríz 5 79 150
Nueva Segovia 5 111 170
TOTALS 611 8880 14309