Nicaragua - National Assembly approves new Foreign Investment Law

The National Assembly approved a new Foreign Investment Promotion Law that updates and modernizes the previous legislation that was approved in 2000, that is, 25 years ago.

This initiative aims to establish legal provisions for the promotion, encouragement, facilitation, formalization and management of foreign investments in the country.

Under this investment law, entrepreneurs from other nations will have the same incentives as national investors.

"We want to encourage investment and make it clear that this is not a pure and simple law to promote investments. It is a law that promotes, encourages, facilitates, formalizes, follows up on and promotes the management of foreign direct investments. It is a comprehensive law, it is not like the law of 2000 that had worked for us until now. Regardless of whether you are not a national investor, I will give you national treatment. That must be clear. It is not a law that will make you blind and dark at home. It is not a matter of opening the doors to foreigners by giving them the moon and the stars and forgetting about the national investor. No, since we have already done a good job with the national investor, then we are transferring that same work to the foreign investor" said Deputy Wálmaro Gutiérrez, President of the Production, Economy and Budget Commission.

This new law highlights that Nicaragua has clear rules on tax matters, there is legal security, there is free monetary convertibility "and that without any problem you can bring your profits in and out of the country because there is free currency convertibility and most importantly; Nicaragua is a country at peace, a country with enormous potential for investment."

Gutiérrez indicated that in these new times of modernity, a new legal framework for investments is required.

This new law creates the National Commission for Foreign Investment (CNIE), which is formed and assisted by the heads of the institutions linked to this matter.

Investments in recent years
In the last 17 years, hundreds of projects have been promoted and developed in Nicaragua in electric energy, roads, production, drinking water and sanitation, ports and hospital infrastructure.

"All these investments make Nicaragua a very attractive platform for attracting both national and foreign investments that allow this country to make the qualitative leap in economic growth" added the legislator.

In the favorable opinion, the legislators of the aforementioned commission considered that it is necessary to update the legal framework for foreign investments, which is in accordance with the Plan to Fight Poverty and Human Development 2022-2026, which seeks to promote, facilitate and attract more national and foreign direct investment.

This law makes it clear that Nicaragua is interested in serious investors, not those with briefcases or whose funds come from illicit activities.

"We are not interested in those briefcase investors or those who may even be financed by drug trafficking, organized crime or money laundering. We are not interested in that type of capital or investors. We are interested in them being legal capital and that the investments are established in Nicaragua respecting the rules of our national legal system" said Gutiérrez.

This law provides many incentives for national and foreign investors in sectors such as fishing, energy, industry, the financial sector, hydroelectric, construction, mining, commerce, MSMEs, the agricultural sector, among others.

Until 2013, Nicaragua received foreign direct investments worth 1,374 million dollars. By 2023, these foreign direct investments exceeded 2,534 million dollars, so it is expected that with this new law, investments will be greater.

Source: 19 Digital