Growth of 9% per year is part of the rewards brought about by incentives for the sector and the opening up of government by working in partnership with private enterprise.
Incentives for tourism have been vital to the creation of new projects in this sector. This is the view of Leonardo Torres, president of the Nicaraguan Chamber of Small and Medium Tourism Enterprises (Cantur), who spoke to Elnuevodiario.com.ni.
Employers claim that at least six projects have been delayed pending analysis by the Board of Tourism Incentives, which has not been in session since the departure of its president two months ago.
There are at least six investment projects in the tourism sector that should have been analyzed by the Board of Tourism Incentives, which, drowning in bureaucracy, is unable to hold sesion because a new president has not been formally chosen.
Nicaragua suffers from lack of air connectivity and from inflated prices to be paid to fly to Managua from nearby cities.
With only five direct air links, Nicaragua is, along with Honduras, the destination with the highest prices of airline tickets, ranging from $460 to $2117, for only one-way trip within the region. In addition, Nicaragua also receives the least amount of airlines, currenly only 7 companies are available.
Tourism entrepreneurs disagree with the list of countries in which the Nicaraguan Institute of Tourism has announced it plans to promote the country.
The tourism promotion agenda includes a visit to the United States, the Netherlands, Finland, Spain and Germany, among others, where tourism facilities on offer for 2015 will be presented. With this initiative it is expected that more than 1.4 million foreigners will be received, which would equate to about $440 million in foreign exchange.
Employers have proposed creating an institute for development representing the private sector and under the Presidency of the Republic in order to serve the needs of the sector.
The government is to make a diagnosis of the activities in the sector in order to review and amend the Law on Promotion, Creation and Development of Small and Medium Enterprises and adjust it to the needs of women, who claim there is a legal gap in the attention they receive from the state.
The amendment to the Law on Tax Coalition which the government is discussing would keep exemptions on the purchase of materials for the sector and contemplates changes to exemptions in the tourism sector.
With the proposed reform agricultural activities would continue to enjoy the exemption from selective consumption tax (ISC), value added tax (VAT) and the tariff on imports (DAI) for the purchase of machinery and other materials needed for the activity.
The average expenditure of 1.27 million tourists who visited the country in 2013 amounted to $41 per day, while for South Americans the figure was $71.
In 2013 the number of tourists visiting Nicaragua increased by 3.3% compared to 2012, when the country received 1.23 million visitors. Of the total amount in 2013, 23.7% were from North America; 6.5% from Europe; 2.1% from South America and 2.2% from other parts of the world.
On March 29th and 30th tourism companies from 10 countries will be taking part in business meetings with local companies.
Tourism businesses from Argentina, Brazil, Canada, Costa Rica, Chile, El Salvador, the USA, Guatemala, Panama and Venezuela will gather together on 29th and 30th of March in Nicaragua, where the Central American nation's second summer tourism fair will be held.
The tourism guild is asking for an improvement in air connections in order to attract visitors from more distant regions such as South America and Europe.
Leonardo Torres, president of the Nicaraguan Chamber of Small and Medium Tourism Companies, said that although passenger traffic increased 10% in January compared with the same month of 2013, air links should be improved in order to attract visitors from more distant regions as South America and Europe.
There are no state resources for the 131 miles of road on the Pacific coast, which would be a key factor for tourism development in the area.
This was explained by the chief of Transportation and Infrastructure, Paul Fernando Martinez. Seven years ago the institution had reported that the study and design was already in process and about three years ago they said they were in the construction phase, however, the authorities now say the project is not profitable.
Even though it has a Promotion Act for the arrival of 'rentistas' and pensioners, Nicaragua has failed to attract such investment on a large scale.
In Costa Rica, for example, it is a business that is booming, with the main attraction being that it has the fourth most prestigious healthcare system in Latin America.
According to Leonardo Torres, president of the Nicaraguan Chamber of Small and Medium Tourism Businesses (Cantur), this is key for retirees, as they are mostly elderly, with chronic illnesses. And not being able to be treated in the United States, for example, because the cost of medical care is high, they look abroad for more accessible systems.
Investments under $50,000 do not receive the tax benefits enjoyed by investors of larger amounts.
The Nicaraguan Chamber of Small and Medium Tourism Businesses (CAMTUR), has asked the Nicaraguan government to contemplate extending exemptions for investments in tourism to small businesses.
Elnuevodiario.com.ni reports that "President of Cantur, Leonardo Torres Cespedes declared that Law 306, Incentives Act for the Tourism Sector, states that to access the exemptions small businesses must invest between U.S. $50,000 and U.S. $100,000, which he considers 'high' for the sector. "
The Tourism Chamber reported a 40% drop in tourists entering the country through Honduras.
Leonardo Torres, director of the Chamber, added that tourism in Nicaragua will be "seriously affected" while the political crisis goes on in Honduras.
"... millions of dollars are being lost, because tourism generates a large supply chain, from transportation entering Nicaragua, taxes paid at the border, hospitality...", reports Elsalvador.com