While 2020 was a year to forget for many countries due to the impact of the pandemic, it marked a major milestone for Andorra as the ambitious country was accepted as the 190th member of the International Monetary Fund (IMF), less than two years after the principality formally applied for membership of the Washington D.C.-based financial institution.
IMF MEMBERSHIP
“For Andorra, the start of our membership of the IMF culminates a process of accession that will allow us to improve our reputation and international approval, have access to more and better technical assistance and training in financial issues and opens the door to have a financial security network in case of need,” Andorra’s Minister for Finance and Government Spokesman, Eric Jover, commented during the momentous occasion.
“Andorra faces both short-term and long-term challenges common to European and other IMF member countries which have been aggravated by the pandemic,” noted IMF Managing Director, Kristalina Georgieva, during the signing ceremony in the US capital. “The IMF stands ready to work closely with the authorities and people of Andorra in achieving their post-pandemic growth and development objectives in cooperation with other partners in the international community.”
FDI has grown by 500% in under a decade, and while the pandemic saw some projects paused, the flow has already restarted.
IMPRESSIVE FDI GROWTH & INITIATIVES
While such experience and support will play an important role in Andorra’s future socioeconomic development, the principality has done a commendable job to date, as illustrated by the vast amount of FDI that has found a home in the country in recent years. The fuse was lit in 2012, when the government approved a law to open the economy to foreign companies and investment. Investors can increase their capital up to 100%, the timeframe for foreign investment applications has been reduced to just a month, with an extension of economic rights to residents and Access to liberal professions for residents. Neighboring Spain and France are the main sources of FDI to Andorra, comprising around two thirds of all investment.
National investment agency Actua is at the forefront of government efforts to secure fresh FDI for Andorra. The three key pillars of its strategy are: economic diversification through the development of clusters oriented towards the fields of innovation, health and wellness, education and sport; attracting direct foreign investors and supporting national companies throughout their internationalization process; and supporting entrepreneurs by promoting collaboration between the public and private sectors and giving support to the development of new business initiatives.
3 key pillars
ECONOMIC DIVERSIFICATION
Through the development of clusters oriented towards the fields of innovation, health and wellness, education and sport
attracT investors and support national companies
Throughout their internationalization process
support entrepreneurs
By promoting collaboration between the public and private sectors and giving support to the development of new business initiatives.
EDUCATION CLUSTER
“The cluster currently features more than 200 professionals from inside the country and abroad who, through generated synergies, help diversify our economy and, at the same time, attract and facilitate the implantation of new health and medical centers,” Actua notes. “We are optimizing existing health resources and creating new business opportunities for our members. In addition, our aim is to provide Andorran patients with the best medical technology, bringing it up to date with current treatments, and creating a new medical infrastructure for the country and generate a brand image around the concept of health tourism.”
One of the most successful clusters is the Andorra Technology and Innovation Cluster (Actinn), the first cluster to be privatized; and now with 50 members. “We want to be the club of business leaders in Andorra. We want to help build trust and strategic alliances between partners as well as develop a dynamic and competitive technological ecosystem,” Actinn says.
