Why to invest in Andorra

Why to invest in Andorra

The case of the Principality of Andorra is that of a sovereign country with a collaborative administration which offers a favorable environment to investment freedom, with a deployment of harmonized standards that provide legal certainty to the holders of these investments.

Advantages of investing in Andorra

1. Attractive tax framework in Andorra

Andorra has an internationally comparable tax framework and at the same time very attractive, with a maximum tax rate of 10% direct taxes (Corporate Tax, Personal Income Tax and Non Resident Income Tax) and a general tax rate of 4,5% for indirect taxes (Value Added Tax).

The non-existence of taxes on wealth or on inheritance and donations, the signature of Double taxation agreements and the fact of not making withholdings on dividends distributed by Andorran companies, turn Andorra into a top-notch destination both for individuals and companies.

Currently Andorra has ten double taxation agreements signed (with Spain, France, Portugal, Luxemburg, Liechtenstein, United Arad Emirates, Cyprus, San Marino and Hungary) and it is in negotiations with Belgium and the Netherlands.

2. Life quality in Andorra

One of the smallest countries in the world, both in size and population. Located between member countries of the EU, of which it is not part.
A parliamentary democracy, with a long period of more than 800 years of peace and political stability, accredit it as an optimal destination for investments.

The GDP per capita is a good indicator of the standard of living. In the case of Andorra, in 2019 was of 36.334 euros, the position number 26 of the 196 countries included in the ranking.

Andorra is a member of the United Nations since 1993 and is currently negotiating an association agreement with the European Union.

3. Andorran society

A cosmopolitan society where more than one hundred different nationalities coexist with a very good social cohesion and without relevant situations of exclusion and isolation. Hardly any crime and exhaustive immigration policies make Andorra a very safe and excellent country to encourage foreign investment. With 78.000 inhabitants, 51,3 % international, its population has one of the highest life expectancies in the world.

4. Education in Andorra

Andorra has three high quality and free educational systems (Andorran, Spanish and French), in addition to three free congregational educational centers and two private English schools.

5. Healthcare in Andorra

Public healthcare for Andorran residents is of an excellent quality and allows, through International agreements, to benefit from healthcare abroad.

6. Connectivity of Andorra

The nearer airports and high speed train stations are in La Seu d’Urgell (27 km), Barcelona (185 km), Toulouse (180 km) and Lleida (150 km).

Regarding La Seu d’Urgell airport, since April 23, 2020 the implementation of an exclusive GPS landing technology allows the airplanes to land and take off in unfavorable visibility conditions. Therefore, regular commercial flights can start operating. In this sense, the Andorran Government is currently in negotiations with several airlines to bring regular flights from European capitals. Private flights are already operating.

7. Natural environment

Almost 300 days of sun per year and with almost no pollution. Only a 3% of the land is urbanized. Multitude and great variety of fauna and flora have earned the recognition of some parts of the country as a biosphere reserve.

8. Energy and Internet.

94,5% of homes have high speed fiber optic internet connection.

The cost of electricity is the second cheapest in Europe.

9. Andorran economy.

Since 2015, Andorran GDP has grown a 7,85%, with an average annual growth in such period of 1,92%, with growth for the year 2019 being of +2,02%.

AAndorra has almost full employment. Government financials are healthy with budget surplus almost every year and with a very moderate public debt level.

With 8 million visitors every year, the main economic sectors are tourism and commerce, real estate, construction and financial services. During the last years, Andorran economy is undergoing a diversification process betting on new sectors.

10. Andorran financial system

Andorra’s official currency is the euro. The supervisory body is the Andorran Financial Authority (AFA) and since the end of the banking secrecy the five national Banks strictly comply with all the International compliance and anti-money laundering regulations, are fully transparent and have a proven solvency.

11. Foreign investment in Andorra

In the year 2012 the foreign investment law was approved. With a prior authorization from the Government companies with a 100% foreign capital can be established.

In the year 2019 investments up to 337 million euros were requested of which 277 million euros were finally approved.

This volume of formalized investment multiplies by more than ten times the values registered in 2013 and represents an increase of 82% compared to 2018.

Websites of interest in Andorra:

• Government of Andorra: https://www.govern.ad/
• Taxes in Andorra: https://www.impostos.ad/
• Social Security Andorra: https://www.cass.ad/
• Inmigration Andorra: https://www.immigracio.ad/
• Statistics Andorra: https://www.estadistica.ad/