Politically, Nicaragua has a troubled past. Many Nicaraguans fled the country in the 1970s and 1980s during the revolution and subsequent Contra war there.
Interestingly, the people who fled or were forced out of the country were people of means – doctors, lawyers, and other highly-educated citizens.
As Nicaragua returned to peace in the 1990s, many of those same citizens have made their return.
The time they spent outside of the country though was spent mostly in the US and in Canada. So they returned with a strong sense of how a free market works. And so Nicaragua is very much a free market today.
They are strongly democratic and English is increasingly used, especially in the world of business.
With all that in mind, it’s not surprising that there is a market in Nicaragua for just about any business. And with it, there is a market for just about any type of investment.
Very Few Restrictions For Investing In Nicaragua
At one time Nicaragua was a place of state-owned monopolies. But for the most part, that is no longer the case.
The result of this privatization means that foreigners are now able to invest in what was once government controlled.
In fact, the Nicaraguan government encourages foreign investment with its policies.
For instance, it allows you to bring 100% of your profits from any investment back to the US without penalty. After 3 years you can do the same with your initial investment too.
You do not need any kind of visa or permit to invest inside of Nicaragua either. From a legal standpoint, there are no restrictions on foreign investment.
How To Safely Invest In Nicaragua
Most Americans of a certain age remember the troubles in Nicaragua’s past. The Sandistas and the Contra War, highlighted to some extent by the Iran Contra affair.
So it’s easy to have visions of a country in turmoil. But we’d like to point out that these struggles ended more than 25 years ago and are simply no longer relevant, at least when it comes to the investment stability of the country.
Nicaragua Is A Safe Country To Invest In
Yes, it is economically challenged and still developing, but that presents great opportunities to the savvy investor.
The bottom line is this. Do your due diligence as you would with any investment, anywhere in the world. But don’t discount Nicaragua simply because of memories of a checkered past.
Real Estate Investments In Nicaragua
As with most countries in growth mode, Nicaragua makes a great place for “path of progress” investing. By simply following where the money is going, it becomes clear which areas of Nicaragua hold promise to be the part of the next boom.
By investing in, for example, a turnkey rental in one of these areas of Nicaragua, you can enjoy passive monthly income while also making a hefty capital gain, if and when you do decide to sell.
When it comes to real estate, this idea is nothing new. But the great thing about Nicaragua is that it’s still largely undiscovered by the rest of the world making it a prime target to get in before everybody else does.
In other words, Nicaragua is a great place for cheap real estate prices with relatively little competition.
Investing In Nicaraguan Tourism And Expats
Although Nicaragua is still relatively undiscovered, the word is starting to spread. More and more people are traveling to and retiring in Nicaragua.
Indeed, although it has a long way to go, tourism is Nicaragua’s number one business. The idea that we’re at the beginning of a massive wave of tourists and expats spending money in the country opens up more investment opportunities.
Of course there’s the real estate. But aside from that, there will be an increase in businesses serving these Americans and others from around the world as well. Things like tourism companies, restaurants, hotels, and more. Investing in Nicaragua for the future growth is probably a smart decision.
Investing In Nicaraguan Agriculture And Productive Land
Nicaragua is a great place to invest in agriculture and productive land as well. The idea of owning real estate that also has a business on top of it that makes money is very intriguing, particularly in a place like Nicaragua where property and labor is incredibly cheap.
One example of such an investment opportunity is a hardwood plantation. Relatively speaking, trees are easy to take care of and can easily wait out any market downturns.
It’s possible in a Nicaraguan investment like this to own a piece of the land this plantation grows on and to earn from the eventual sale of the wood as well.
As you can see, there are plenty of investment opportunities in Nicaragua. And time is right, before the rest of the world catches on.
How Are Capital Gains Taxed In Nicaragua?
In Nicaragua capital gains are taxed according to a progressive rate schedule, up to a maximum of 30%. A withholding tax rate of 20% is levied on capital gains realized by nonresident individuals through selling Nicaraguan real estate properties.