Puerto Rico: Invertir a Puerto Rico
For more than half a century, the Puerto Rican government has pursued its principal objective of creating new jobs by attracting foreign investment through financial and fiscal incentives. Among the financial incentives offered are rental of public buildings at attractive rates, wage incentives and access to financing through tax-free industrial bonds and direct loans. However, in the name of national security the federal government limits foreign investment in transportation, utilities, banking, communication, finance, nuclear power and defence. According to the UNCTAD's World Investment Report 2022, FDI in Latin America and the Caribbean decreased by 56% in 2021, to an estimated USD 134 billion, as the global economy recovered from the initial impacts of the COVID-19 pandemic. Among the most significant investments made in Puerto Rico over the past few years are the invest of USD 30 million made by the German health-care company Fresenius Kabi in 2020, to expand its manufacturing complex in San Germán, modernising and automating the plant to increase its capacity and competitiveness; and a USD 50 million investment made by another German corporation, the pharmaceutical giant Boehringer Ingelheim, also made to expand its manufacturing site in Puerto Rico.
The United States has created a variety of incentives for foreign investment in Puerto Rico, including tax incentives and exemptions, the use of U.S. currency, and government-backed start up costs. The Puerto Rican government actively seeks FDI, mainly through financial and tax incentives, which include renting out public buildings at attractive rates, wage incentives and access to financing through tax-exempted industrial bonds and direct loans, full or partial tax exemptions on income, property ownership, gross income of municipalities and construction, and excise taxes for certain agricultural activities. Additionally, the national investment promotion agency provides aid for foreign investors who seek to invest in the country. Puerto Rico's attractiveness include a skilled and relatively cheap labour force, excellent infrastructure, political stability, and a diversified economy. Also, as Puerto Rico is a U.S. territory, treaties signed by the U.S. government apply to the island as well. However, Puerto Rico is vulnerable to climatic factors, it has a high rate of poverty and unemployment and high level of bureaucracy.
Country Comparison For the Protection of Investors | Puerto Rico | Latin America & Caribbean | United States | Germany |
Index of Transaction Transparency* | 7.0 | 4.1 | 7.0 | 5.0 |
Index of Manager’s Responsibility** | 6.0 | 5.2 | 9.0 | 5.0 |
Index of Shareholders’ Power*** | 8.0 | 6.7 | 9.0 | 5.0 |
Source: Doing Business, Latest available data
Note: *The Greater the Index, the More Transparent the Conditions of Transactions. **The Greater the Index, the More the Manager is Personally Responsible. *** The Greater the Index, the Easier it Will Be For Shareholders to Take Legal Action.
- bilingual and skilled labour force, which is less expensive than in the mainland United States;
- excellent communication network and infrastucture;
- the security and political stability of the U.S. judicial system;
- diversified economy, benefiting from its US founding.
- vulnerability to climatic shoks (a huricane partially destroyed the island in 2015, strongly slowing down the economy);
- high external debt ;
- rather complicated administrative organisation, as a self-governing Commonwealth inside the US;
- high poverty and unemployment rates.
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Actualitzacions: November 2023