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While we habitually more readily associate the Caribbean with stunning beaches and tropical holidays, the region is fast becoming a lucrative opportunity for business expansion. With a conducive regulatory framework and skilled workforce, it’s little wonder why North American and European businesses are identifying the well-positioned islands as the next destination to grow into.
The Caribbean has become a leading destination for investors, with the region growing into one of the world’s top recipients of foreign direct investment (FDI) in recent years.
Between 2015 and 2020, Caribbean islands hosted 247 FDI projects, with yearly investments growing 25.9% during the five-year period from $5.8 billion to $7.3 billion.
Additionally, the region is renowned for its conducive infrastructures that are well-suited for foreign investment, and many nations within the region stand out on a global scale for their high potential regulatory environment and skilled workforce.
High-Potential Destinations for Businesses
As the largest island in the Caribbean with a high volume of English-speaking workers, Jamaica is one of the best destinations in the region for businesses to expand into.
Featuring a population of almost three million residents, 2013 saw Jamaica take strides in reforming its economy, with a keen emphasis on fostering growth alongside international support.
As a result, Jamaica sits among the world’s top 20 countries for its credit reporting systems and is a leading environment for businesses to flourish, according to the World Bank’s Doing Business report.
In terms of opening a business in the nation, it takes just two procedures and approximately three days for an entrepreneur to formally operate a business in Jamaica.
Additionally, the Cayman Islands benefit from its status as a self-governing British Overseas Territory. These islands benefit from advantageous taxation laws, which don’t include any corporate taxes, making the location ideal for setting up a Caribbean business base.
As well as having no corporate tax, the Caymans are tax-neutral, meaning that there are zero direct taxes on residents. The islands also offer the highest standard of living in the region, with an average annual income of around $56,000 among its population.
One of the Caribbean’s most up-and-coming economies is the Dominican Republic. Having experienced steady fiscal growth since 2014, the Dominican Republic is officially an economically stable nation, and its 4.9% GDP growth recorded in 2022 places it comfortably above the regional average.
With a growing transportation and technological infrastructure, a series of lucrative international trade deals, and a conducive regulatory environment in place, the Dominican Republic is one of the most high-potential nations to open a business for its strong connections and US proximity.
Seamless Trade Openness
One of the biggest perks of the Caribbean for foreign investors is the fact that the small geographical size of the islands has historically meant that foreign trade is essential for growth.
This has paved the way for many trade agreements and growth-focused trade blocks that are focused on eliminating the barriers to trade such as quotas and tariffs.
For companies intent on conducting business in the region, this means adopting a more international mindset is far more frictionless than in more self-sustaining markets.
Unlocking a Highly Skilled Workforce
Another major advantage of expansion into Caribbean nations is the strong talent pool of well-educated workers that businesses can tap into alongside more competitive salary expectations.
Tech-driven education initiatives geared towards providing Caribbean students with the sufficient skills to thrive in industry 4.0 environments will prove to be a major opportunity for businesses seeking to tap into a less competitive job market while ensuring that they tap into a strong talent pool of workers.
While wage expectations can vary significantly throughout the region, high-potential nations like Jamaica and the Dominican Republic both feature lower average salaries relative to the United States, making the Caribbean a strong opportunity for expansion while remaining geographically close to North America.
Advantageous Geography
Based in the heart of the Americas, the Caribbean is one of the most advantageous regions for businesses to expand into.
As well as sharing a timezone with the United States, Caribbean nations supplement a series of positive trade agreements with European nations by remaining close in terms of working hours with Western Europe. This can help to build more bridges between growing companies and European markets.
Crucially, the Caribbean region serves as a doorway into Latin American markets, too. With Spanish serving as a shared language between much of the two regions, businesses can use their Caribbean base as an entry point into the rapidly evolving technological landscape throughout Central and South America.
With the likes of Brazil and Mexico experiencing significant growth throughout fintech sectors in particular, the lure of the Caribbean as a midway point between established and emerging markets is not to be missed by globally-focused businesses.
Embracing Opportunity
The Caribbean may still conjure images of picturesque beauty spots and sandy beaches, but the region has plenty more to offer than holiday destinations.
Packed with a conducive infrastructure geared towards international growth, Caribbean markets can provide businesses with cost-effective expansion opportunities as well as access to a skilled workforce and a vast range of high-potential international trade agreements.
For businesses seeking to adopt a global mindset on a budget-friendly basis, there aren’t many better prospects than the Caribbean to build an international HQ.
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