Ecuador’s GDP grew in 2014 by 4%. It is the third Latin American country with less unemployment. And in the last seven years, the government of Rafael Correa has made a strong investment in education and training has prioritized youth. It is an area with “relative peace and political stability.” In addition, the government has launched a long series of measures to encourage investment by foreign companies and to ensure legal certainty. These are the reasons that the Ecuadorian ambassador to Spain, Miguel Calahorrano, yesterday contributed to dozens of entrepreneurs who gathered in Valencia at an event organized by the newspaper Expansion.
The ambassador stressed that the social policy of Correa has helped create a secure environment for investors. It provided some data, such as that in the last seven years and a half million people have escaped poverty, or 14% of GDP is being devoted during 2015 to investment in educational infrastructure, technological equipment and scholarships for big universities. Health is also a priority, he added, and a reference to the “rights of nature” is included in the Constitution.
Tax incentives for investment
Ecuadorian representatives emphasized the attractions specifically designed to attract foreign companies. José Luis Cabascango, head of the Commercial Office Pro Ecuador, reeled off the facilities put in place by the Government. It is especially advantageous, he said, for the “nine priority sectors”. Among them, he cited agribusiness and fresh and processed products. He explained that it has created an “updated legal framework” with the wording of the Organic Code of Production. Both income taxes as levied on foreign currency outflows may become 0%, provided that the requirements as the money leaving the country back to him with investments such as the purchase of machinery are met.
Cabascango and Calahorrano acknowledged that in recent years Ecuador has suffered a crisis by lowering the price of a barrel of oil. The main cause is that the country has the dollar as its currency from the serious banking problems that crossed in 2000. This circumstance is positive for investors because it provides a sound monetary framework, but is negative for economic sovereignty of Ecuador, which You can, for example, not to devalue its currency. This has led the government to establish some temporary import barriers designed to prevent people go to stock up on some goods to neighboring countries, which have better prices because they themselves have been devalued. Several entrepreneurs complained that present circumstances.
Examples of Spanish companies investing
Rafael Thomas, Global Head of Tecnoagro, was one of those invited to participate in the symposium. The company is based in Valencia, it is dedicated to the manufacture of fertilizers and is an example of internationalization, as it operates in over 50 countries. Thomas recounted the difficulties and advantages of the case of Ecuador. He said it is a country “many opportunities” and was satisfied with the work of the government. Among the problems he complained of tariffs and intensification of certain technical requirements for the import and invited government representatives to “assess” the situation.
Thomas noted the attention that the Spanish investor must pay to the cultural peculiarities of the area. He explained the need to change our “direct” way to address the issues in a negotiation, since the treatment in the Andean country is usually more polite and gentle. Another recommendation was the importance of “making a preliminary market research before exporting. Each trip should be prepared as a test. “
