For the latest industry expert Q&A, Biz Latin Hub’s Nicole Mueller had the chance to chat with Luigi Wewege, president of Belize’s award-winning Caye International Bank, about investment opportunities and doing business in Central America.
Luigi is the author of The Digital Banking Revolution, now in its third edition, and has also co-authored economic research presented before the United States Congress. On top of his work with Caye International Bank, he serves as an instructor at the FinTech School in California and as an advisory board member of Fort Kobbe International Vaults in Panama.
Luigi has worked with Caye International Bank for over five years, first serving as a senior vice-president and head of private banking, before stepping into his current position at the beginning of 2021.
He holds an Italian MBA with a major in international business. He also has a BSBA with a triple major in finance, international business, and management from the University of Missouri-St. Louis in the United States.
What makes Central America an attractive part of the world to invest in, as opposed to elsewhere in Latin America or other developing and emerging markets?
Central America has a great deal to offer potential investors. One has to do with the rich range of agricultural resources found in the eight nations that comprise this part of the world. Investment in industrial farming, food processing, and any industry that supports agricultural efforts is highly likely to thrive, offering investors the opportunity to realize significant returns.
There’s also the robust nature of the tourism industry in many parts of Central America. It’s not just along the coasts. Owning to the rich history, visitors come to see the sites and enjoy recreation. That means any business venture geared toward providing housing, entertainment, cuisine choices, or guided tours has significant potential to be successful.
Through it all, construction is an excellent investment opportunity in Central America such as building luxury hotels, housing, retail areas, entertainment venues, and other supporting structures. With development ongoing throughout this part of the world, the potential to enjoy high expected returns is possible.
As an investment market, what are the biggest advantages that Belize has to offer to investors in general, and especially to investors in the US?
The ongoing expansion of multiple investment opportunities is key to Central America, particularly Belize. There is no doubt English being readily spoken in many nations, particularly in Belize, makes it much easier for investors in the United States, Canada, the United Kingdom, and Australia to conduct business. The lack of a language barrier is sometimes the main factor that attracts people to our area rather than looking elsewhere.
It’s far from just the convenience of being able to make business deals without the need for an interpreter. The physical proximity of Belize and the rest of Central America to the United States means investors can visit with greater ease. The ability to see the construction you’ve invested in up close and personal means a great deal. The same is true for being able to tour farms or check out the resort hotel that’s the result of investing efforts can also be rewarding.
Stable economies, in general, tend to attract investors. Belize certainly has that to offer, along with other nations within Central America. Given how Belize has weathered a worldwide pandemic in comparison to some other parts of the world, it’s no wonder that people look here for the ideal investment opportunities.
What are the biggest investment trends in Central America, specifically in Belize?
There’s no doubt that real estate, commercial and residential opportunities, is one of the most prominent investments throughout the region. Growth in popular tourism locations means the need for adjacent resorts and hotels. It also means commercial enterprises for shopping and dining. Increased labor for the development also means more demand for residential properties.
Energy and agriculture are historically lucrative investments in Belize and other parts of Central America. This is not projected to change over the next several decades. Actually, the development of alternative energy has never been more robust. In terms of agriculture, trade agreements with other parts of the world are likely to keep the demand for production in Central America high for a long time.
What are the biggest business and investment opportunities in Central America, or more specifically in Belize?
The tourist trade continues to be a significant player in the economies of Belize and several other nations in Central America. While well established, the ongoing expansion means opportunities to enter into different land development projects. It also means an increased potential to establish companies that provide goods and services to people vacationing anywhere in the region.
Belize is well-suited for those seeking to identify and secure investments throughout Central America and the Caribbean. Banking regulations that provide security to investors, coupled with services and support offered by financial institutions, make adding an international component to a portfolio less of a risk while increasing the odds for higher returns.
Infrastructure is also an excellent investment in Belize and other Central American countries. A lot is happening, from communication options such as enhanced internet speeds to improved roadways. Investment in these areas of improvement is likely to lead to significant returns.
Both Belize and Panama are known for their offshore banking regimes. What makes them so attractive to investors?
Aside from the lack of a language barrier, the clarity of banking laws and how they apply to offshore clients is a significant advantage. Interested parties find much of the law like that in their native countries. The fact that they don’t feel lost in a sea of rules and regulations makes it easier to consider banking in these countries.
There’s also the fact that those banking laws offer several protections and benefits to offshore clients specifically. Depending on the particulars, clients may enjoy tax breaks on their investments and the interest their account balances accrue. A look at the interest rates that apply to those accounts with eligible balances also confirms that it’s possible to grow wealth in Belize and Panama at a faster rate than those same balances would provide in other settings. Bank clients knowing their account information is secure is another major bonus.
Are there any major differences between the offshore banking and business regimes in Belize and Panama?
While the laws in these two countries do provide many of the same benefits, there are reasons why an investor may choose one over the other. Many of them have to do with the degree and types of protections offered and how they happen to relate to the individual investor. A prime example is someone who wishes to establish an international business company as the vehicle for creating and growing wealth under either the common law in Belize or the civil law found in Panama.
Current tax laws are a critical element that investors should also consider. Depending on the nature of the investment and the stated purpose for the business venture, one nation may offer slightly more incentives than the other. In like manner, the duration of those tax benefits is something to consider. While one incentive may be attractive but only apply for a specified term, a different incentive may continue perpetually.
Remember that tax obligations may be based on net income rather than generated or collected revenue. This is a fine point to consider closely, especially if there is a need for the company to file annual returns. It’s important to be aware of current legislation that would impact benefits, filing update requirements, and other business operation aspects. From time to time, both nations have amended those laws and regulations. An investor in Belize or Panama would do well to keep updated on proposed regulations and the likelihood of these being enacted.
Biz Latin Hub can assist you doing business in Belize
At Biz Latin Hub, we provide integrate market entry and back office services throughout Latin America and the Caribbean, with offices in more than a dozen countries around the region and trusted partners in other markets where we don’t currently have a presence.
Our unrivaled reach around the region means that we are ideal partners to support multi-jurisdiction market entries and cross border operations.
Our portfolio of services includes company formation, accounting & taxation, legal services, due diligence, and hiring & PEO, among others. So whatever your investment plans are, we can provide a package of services to suit your needs.
Contact us to find out more about how we can support you doing business.