Nicaragua Offers Excellent Investment Opportunities

Pacific coast sunsetNicaragua has one of the fastest growing GDP rates in Central America. Unlike many other nations, Nicaragua has complied with IMF demands to cut its deficit, implement structural reforms, and maintain overall monetary stability. As a result, Nicaragua is set to benefit from rapid and sustained economic growth in the years ahead. To further assure the nation enjoys economic growth, the government has passed several laws designed to attract and protect foreign investors. Direct foreign investment has grown steadily since the mid 1990s, with a third of all investment coming from the United States. Foreign investment is mostly focused on agriculture, construction, services, manufacturing, mining, energy, and tourism.

There Are Very Few Restrictions To Foreign Investment In Nicaragua

Nicaragua has privatized nearly all the once state owned monopolies. Doing so has dramatically reduced the amount of government bureaucracy that previously challenged investors. In fact, a foreign investment law ensures that investors can repatriate 100% of profits from day one. After three years investors are able to repatriate their initial investment as well.

There are no legal grounds for discrimination against foreign investors, and there are no restrictive visas or work permits required that may inhibit investment. Laws already in place allow for 100% foreign ownership in all economic sectors.

Investing in Nicaragua Is Safe

Contrary to wide spread misinformation, Nicaragua is a stable and safe country for investment. Nicaragua is one of the safest country in all of the Americas. In fact, Nicaragua has a lower reported crime rate than the USA, France and Germany according to a United Nations-Interpol study.

Tourism Businesses Are Tax Free For Up To 10 Years

INTUR Logo

Logo of INTUR

I recommend to clients thinking of making an investment in Nicaragua to consider doing so within the tourism industry. Nicaragua has already been discovered as an affordable vacation destination, with tourism growing at an annual rate of approximately 9%. INTUR continues the promotion of Nicaragua as a tourist destination, assuring future growth.

The Nicaragua government appreciates that an improved tourism infrastructure will further enhance visitor traffic and is committed to provide the incentives necessary to realize that growth.

Nicaragua’s Law 306 was enacted in September 1999 to attract investment in the tourist industry. It is not only the most attractive, but also the most aggressive tourism investment incentive law in Latin America. Tourism infrastructure businesses that qualify for incentives run the gambit of B&Bs, hotels, eco resorts, tour operations and such.

Law 360 is broad in scope and offers investors benefits that are hard to beat. If a business qualifies, it pays no income or real estate taxes for up to 10 years. Also, investors can import or purchase locally all that is needed to operate the business; furniture, linen, cleaning supplies, even vehicles and boats, totally tax free.

The application and approval process is straight-forward. INTUR, the federal government tourism agency, cuts through the red tape and outlines very clearly what investors need to do. The process is quick too. Law 360 allows INTUR just 60 days to approve an application. Depending on the type of project, an investment of only $30,000 is all it takes to qualify for these benefits.

To recap, Law 306 offers investors:

  • Pay no income taxes for up to 10 years
  • Pay no real estate taxes for up to 10 years
  • Import all the supplies and materials needed tax free
  • Local purchases of goods and services are tax free for up to 10 years

Nicaragua tourism is an industry worth considering. A virtually nonexistent industry back in the 1990s, tourism is now Nicaragua’s top income producer and second largest employment sector, following only agriculture. I strongly recommend considering investment in Nicaragua for anyone interested in the tourism industry.

If you have any questions regarding investment in Nicaragua, please feel free to contact Nica Investments.

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