In conclusion, all these regional factors are expected to prevail making Nicaragua attractive for tourism in general and Medical tourism in particular. The four Nicaraguan elected Presidents since 1990 have come to the realization that tourism is vital to the prosperity of the country and have taken firm steps to make it even more attractive. Three particular actions give substantial credence to the continuity of the governments philosophy in favor of tourism:

LAW 306

Incentives to the Tourism Sector, passed in 1995 and improved or fine-tuned twice since then, provide the investor in tourism significant incentives that include:

• Exonerations from import duties on the material and equipment used in a hotel or medical tourism projects.
• Exoneration during the following 10 years of 90% of the income tax on profits. Thus the effective tax rate is reduced during the first decade of the project to 3%. This benefit can be extended for an additional decade if minor investment are added prior to the conclusion of the first period.
• Exoneration for the same period of 10 years on property taxes.

This law alone, has served to fuel investment in tourism projects as can be observed in the chart to the left demonstrating a sharp increase in tourism investment projects since 2005.

THE COASTAL LAW

Passed in June of 2009, provides security on beach property ownership. This law is one of the friendliest in the region, specially if we consider those central american countries where beach property ownership is forbidden like in Mexico. The law guarantees ownership of beach property beginning from 50 meters above medium high tide. Since its approval in June of 2009, it has been subjected to intense scrutiny by legal experts who are all convinced of its far reaching impact as it provides legal protection to beach property owners.

LAW OF RETIREES

Passed together with the Coastal Law (above), is another excellent jurisprudence providing far reaching substantial incentives for foreigners to come and retire in Nicaragua. Besides the usual benefits, this law authorizes tax brakes on retirees who want to build a home, allow the importation of household goods and (with certain limitations) the import of one car, free of levies. This law is slated as one of the best in Central America.

FREE ZONE LABOR AGREEMENT

This labor agreement constitutes a tri-partite agreement providing long term amicable relationship between proprietors and workers.

ONE STOP SHOP FOR FREE ZONE SERVICES

This is a One-stop-solve-all bureaucratic government office that provides speedy response to most if not all requisites for importation of goods and approval processes.

These factors, both the macro (world and regional trends of tourism) and the micro, (property tenure security and incentives to tourism projects) clearly provide a solid platform for a successful tourism project in Nicaragua. The following Exhibit details the amount of investment and the jobs generated in several areas, all of this for the year 2008.

During the year (2009), the Assembly has approved a major project for hydroelectric generation of 165 MW, an investment that will be made by large Brazilian consortium totalling U$ 360 million.

For further information regarding financial analysis or any other matter, please contact gensa@cablenet.com.ni