It’s Time To Be Looking At Nicaragua For Investment Again

It’s Time To Be Looking At Nicaragua For Investment AgainNicaragua For The Tourist, The Retiree, And The Investor

Sept. 15, 2014
Panama City, Panama

Dear Offshore Living Letter Reader,

I traveled to Nicaragua this past weekend for the first time since 2006. That’s the year, coincidentally, when Daniel Ortega was re-elected this country’s president. He’s since been elected for a second consecutive term in 2011 and sits as Nicaragua’s president today.

It was lack of time that kept me from returning to Nicaragua these past eight years. Just too many other places I had to be. For many, though, Ortega has been the deterrent. He was, after all, the leader of the Sandinistas, the group that ousted the dictator Samoza back in 1979, and the same guy who, then, once in power, confiscated land and redistributed it to the poor. Investors had concerns.

Then came the global downturn that started in 2008. In its wake, both investors and tourists were even thinner on the ground in this country.

Seeing the volume of traffic in Granada this weekend, I think it’s safe to say that the tourists have returned full force. A new (well, new to me) pedestrian street lined with restaurants extends now from Granada’s main square toward Lake Nicaragua and was crowded with people every time I passed. Many new hotels have opened in this city in the last eight years. However, more important, the hotels I remember from 2006 are still there. They survived the downturn.

I don’t think this little colonial city has seen as much activity as it is seeing right now at any other time during its almost 500-year history. Based on my conversations over the three days, it’s not only tourists who are feeling comfortable enough to give Nicaragua another chance. It’s investors, too.

Everyone I met with—expats, business owners, and those in the real estate industry—assured me that the market is returning. Sales are being made at greater rates than at any time since 2008. After almost eight years in office this time, Ortega hasn’t made a move against anybody’s property. As the book I’m reading on Nicaragua’s history over the last 100 years puts it, today’s Ortega is not 1970s Ortega. Ortega today is the capitalist version of a Sandinista, with an appreciation of the importance of personal property rights.

My main impression from this weekend’s visit is that Nicaragua still makes sense for many reasons. I like this country for a lot of different agendas.

For tourists, Nicaragua is an absolute bargain. The super-low cost of everything attracts backpackers, of course, but it also attracts others looking for a high quality-vacation at a bargain price. The legitimately four-star hotel where we stayed in over the weekend, La Gran Francia, cost us US$60 a night, including breakfast and Wi-Fi. Continue reading “It’s Time To Be Looking At Nicaragua For Investment Again” »

Know Your Client Rules And Requirements Around The World

Know Your Client Rules And Requirements Around The World
Know Your Client Rules And Requirements Around The WorldPost-FATCA Madness In Real Time

Sept. 11, 2014
Panama City, Panama

Dear Offshore Living Letter Reader,

The unintended consequences of FATCA and the overreach of the U.S. government and the IRS have started playing out around the world. In the last week, I’ve heard from a half-dozen people with “know your client” tales of woe.

Indeed, I have my own.

Let’s start with the know-your-client form that the homeowner’s insurance company I have a policy with for my Medellin apartment sent me last week. The form is two pages long and asks for some understandable information, such as the name of the person holding the policy, the address of the property being insured, etc.

Then it goes on to ask the nationality of the person holding the policy. Why would an insurance agency need to know the nationality of someone buying a homeowner’s policy from them?

But wait…there’s more. The form also includes a tick box asking if the policy-holder has other nationalities. If so, the form continues, the policy-holder is to name them.

Then this homeowner’s insurance form wants to know what residencies I hold. Continue reading “Know Your Client Rules And Requirements Around The World” »