Peru's petrochemicals-based textile industry is calling for a specific law, similar to that of the agricultural sector, to be implemented to protect local producers from unfair competition from cheaper products, particularly from China. According to the head of textiles at trade group Sociedad Nacional de Industrias (SNI), this regulation could help boost textile exports by $2 billion in the US market within a few years.

Despite the COVID-19 pandemic, Peru's textile exports increased by 7.8% in 2020, with the sector employing around 400,000 workers in a country of 34 million residents. However, textile exports are still below their peak in 2014, when they reached $1.2 billion. China is the main competitor of Peru's textile industry, accounting for 53% of Peru's textile imports in 2020, followed by Vietnam (11%) and Bangladesh (6%), according to the Ministry of Production.

Although the Peruvian government created a national plan for the development of the textile and clothing industry (PLANTEX) in 2016, some industry experts argue that more targeted regulation is needed to protect local producers and boost exports. The proposed law for the textile industry would be similar to the Law for the Promotion of the Agricultural Sector, which provided tax incentives and other benefits to support agricultural production and exports.

Peru's textile industry is dominated by small and medium-sized enterprises (SMEs), which often struggle to compete with larger, more established companies.

If implemented, the proposed regulation could level the playing field and support the growth of SMEs in the sector.