Foreign Investment: How to Take Advantage of the Crisis?

The health and economic crisis will result in a reordering of foreign investment at the global level, and countries like Central America will have the opportunity to take advantage of their geographical position to attract fresh capital.

Wednesday, May 6, 2020

The outbreak of covid-19 worldwide will cause a drop in production in 2020, however, by 2021 and 2022 the forecasts of international organizations anticipate that economic activity could rebound, a rise that would be coupled with new investments in various markets and sectors.

See "Economic Growth: Forecasts for the Region"

Julio Hector Estrada Domínguez, former director of the National Competitiveness Program and of Guatemala's Investment Attraction Office, told Prensalibre.com that "... the crisis will lead to a reordering of investments and for that we must be careful to take full advantage of opportunities, since it will hit the value chains, especially those industries that depend on imports from China."

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Estrada added that "... Part of that reordering will be that the economic blocks will look for closer areas in order to work and concentrate their capital. For example, the processes of assembly in technology or textiles that U.S. companies were carrying out in China will be shifted to other nearby territories such as Mexico, Central or South America, and like China, will seek to concentrate on its own continent."

The legal certainty that countries can provide, the fiscal incentives for investments and the reduction of paperwork are part of the factors that could positively influence the new economic context that will emerge after the pandemic.

Ask for the specific forecasts for your country and your business sector in the interactive report "Information System: Covid-19 and Business Outlook".

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