Page 188 - Caribbean-Central America Profile 2018

NICARAGUA

CARIBBEAN-CENTRAL AMERICA PROFILE 2018

Official Name: Republic of Nicaragua
Capital: Managua
Nationality: Nicaraguan(s)
Official Language: Spanish
NICARAGUA
Population Total (millions): 6.15 (2016 est.)
Size: 53,668 square miles
Currency: Nicaraguan Cordoba (NIO)
Internet Domain: .ni
International Dialling Code: +505
Electricity: 120 volts/60 cycles

COUNTRY OVERVIEW: INVESTMENT INCENTIVES
q Nicaragua is strategically located in the heart of The Government of Nicaragua offers a series of investment incentives in priority
the Americas: it is located at the center of the sectors of the economy, such as:
Central American isthmus that forms a land bridge • Tourism
between North and South America. • Renewable Energy Generation
q It is bordered on its eastern and western shores by • Agribusiness & Forestry
the Atlantic and Pacific oceans, respectively; to the • Social Housing
north lies Honduras, and to the south Costa Rica. • Export-oriented activities:
q It is the largest country in Central America with a • Textiles & Apparel
• Manufacturing & Assembly
territory of approximately 130,600 square kilometers.
• Business Process Outsourcing
q A country of unspoiled natural landscapes, Nicaragua
offers virgin beaches on the Atlantic Ocean along The Government supports these investment initiatives by providing legal guarantees to
the Caribbean coast, an amazing volcanic chain, the investors by the following laws:
largest lake in Central America, cloud forests in its LAW FOR THE PROMOTION OF FOREIGN INVESTMENT
northern region and magical colonial towns in the (LAW NO. 344)
Pacific region of western Nicaragua. The main legislation that governs foreign investment consists of Law No. 344 for the
q The capital is Managua. Promotion of Foreign Investments and its bylaws. The law seeks the creation of the
appropriate legal framework, with clear and precise rules to attract new investments.
Pro-business legislations and administrative procedures Some of the highlights of the Law of Foreign Investment are:
have contributed to a strong inflow of foreign • Equal treatment to local and foreign investors.
investment in recent years. Furthermore, Nicaragua’s • Freedom to make investments: any individual or entity, national or foreign, may
excellent economic performance has been recognized carry out investments of any kind, except for those few activities limited by the
by the International Monetary Fund (IMF) through a Law.
series of revisions over the past years.
• Transfer of Funds Abroad: Foreign investors are guaranteed to enjoy an
Over the last decade, the Central Bank of Nicaragua expedited transfer of funds abroad and conversion to foreign currency though the
established a “crawling peg” exchange rate regime local banking system.
whereby the local currency (Córdoba) devaluates 5 • Access to Local Financing: The foreign investor may have access to financing
percent annually versus the U.S. dollar. For 2017, the available in the local banks, according to the terms established by them.
average exchange rate is C$30.05 Córdobas for every • Protection of Property and Safety: Nicaraguan law recognises and guarantees the
dollar. This successful system assures a high level of rights of the national and foreign investor, the protection of their property and the
currency stability, while at the same time maintaining right to the free disposition of assets, capital and profits.
the country’s export competitiveness. • Refund of equivalent taxes to 1.5% on the FOB value of the exports (does not apply
to Free Zones, since no taxes are paid).
The Government of Nicaragua recognizes the positive • Entry of goods in the national territory as well as the local purchase of the same,
impact of foreign direct investment (FDI) in an without payment of import tariffs and taxes, provided that the same are re exported
economy such as the one Nicaragua has, and therefore after being subject to a transformation process.
actively and openly promotes it, so that the country is
responsible with its employees, the community and the TOURISM
environment. Tourism is currently the second largest industry in Nicaragua. Nicaragua has seen
positive growth in the tourism sector over the last decade. The growth in tourism has
also positively affected the agricultural, commercial, and finance industries, as well as
the construction industry.

C-30 Caribbean-Central American Action