The Lure of Cheap Labor

Honduras, Guatemala, Nicaragua and El Salvador attract investment based on the exploitation of natural resources and unskilled, but cheap, labor.  

Tuesday, June 18, 2013

A report by the Central American Institute for Fiscal Studies (ICEF), reveals that Central America recorded last year $9.70 billion in foreign direct investment (FDI), with Panama and Costa Rica being the recipients of about 60% of these flows.

Of that amount, "$3 billion remained in Panama", the most dynamic economy in the region along with those of Costa Rica and Nicaragua, explains the analysis. According to Jonathan Menkos, ICEFI executive director, the situation "has been repeated for about 15 years, to a large extent as a result of the efforts that both nations are making to improve their human capital."

"We note that much of the investment that is coming to Panama and Costa Rica will allow higher growth in the medium and long term, because they relate to services and telecommunications," he added.



More on this topic

Shortage of Specialized Technicians in Nicaragua

April 2017

There is still a shortage of workers with the skills and technical training needed to work in several sectors, ranging from agriculture to telecommunications.

Workers with skills to not only operate but also repair specialized farm machinery, and even to train people in the operation of specialized software are what companies have been unable to find in different sectors in Nicaragua. Despite efforts, some even made by various private companies, to fund studies and train their employees so that they can acquire the necessary skills, there remains a significant gap between labor supply and demand in the country.

Costa Rica Attracts Investments Outside Metropolitan Area

September 2015

Cities far away from the capital which have free zone regimes, labor and are close to ports, are becoming attractive places for businesses.

The characteristics of the so-called "emerging cities" outside of the greater metropolitan area, are mainly being exploited by multinational companies who want to operate under free zone schemes and near port terminals and areas with good road access.

Panama Must Import Labor

November 2010

There isn´t adequate availability of skilled labor to build, manage and administrate the ambitious projects of the state's infrastructure plan.

The construction of the first Metro line involves 3,000 jobs, the redevelopment of the Canal another 6,000 and other infrastructure projects raise the total to 34,000 direct jobs which will be created by 2011.

Skills shortage threatens Costa Rican economy

May 2008

Costa Rica faces a shortage of manpower with skills in engineering, management and the English language.

Emmanuel Hess, director general of the export promotion agency, Procomer, said the education system is failing to meet the needs of the economy.
More statistics are required, he added.

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PRONicaragua

PRONicaragua, is the Nicaraguan Investment Promotion Agency, established in 2002. We are a non-profit, public-private institution whose mission is to generate economic growth and job creation in Nicaragua by attracting high-quality foreign direct investment. The Agency provides complimentary support services to qualified investors seeking investment opportunities in our country.
Operates in Nicaragua
Phone: (505) 2270 6400

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