Andorra: a new economic opportunity in Europe
Andorra, nestled in the heart of the Pyrenees between France and Spain, is emerging as a haven of economic opportunities in Europe. Its fascinating history, spectacular natural setting, and investor-friendly policies make it an attractive destination for those looking to expand their businesses or invest in a stable economic environment.
The current economic context
Financial situation
Andorra, traditionally known for its tourism and trade sector, has evolved into a diversified economy. With a steadily growing GDP, the country maintains solid financial stability, bolstered by attractive fiscal policies.
In 2022, Andorra’s GDP reached around €3.5 billion, with an average growth of 2.5% per year in recent years. Its unemployment rate, below 3%, illustrates the dynamics of an active and expanding labour market.
A summary of the Andorran economy
- Population: 70,000 inhabitants
- GDP: €2.5 billion.
- State budget: approximately €350 million.
- Deficit: €50 million, or 2% of GDP.
- Public debt: around €950 million (State and municipalities), i.e. 35% of GDP.
- Import goods: €1.35 billion in 2022.
- 44,000 jobs, including 38,000 employees
- Minimum wage: 962 euros.
- Average salary: around 2,000 euros.
- Social security contributions: 20% of which 14.5% employer share and 5.5% employee share. (Forecast 22%)
- Coverage comparable to France
- Social Security Agreements
- Tourism and trade: 8 to 10,000,000 tourists per year.
- Skiing and mountain activities.
- Financial activities: 20% GDP.
- Service activities: 80% of GDP.
Key partner countries
Top Customers (% of Exports) | 2022 |
---|---|
Spain | 78,3% |
France | 6,2% |
United Kingdom | 3,2% |
Germany | 1,5% |
Norway | 1,2% |
Tax benefits
One of the main advantages for investors is the attractive tax regime. Andorra is renowned for its low taxes, with a single corporate tax rate of 10%. In addition, the country does not impose VAT but its much more advantageous equivalent: the IGI, thus offering a significant competitive advantage for companies.
- No inheritance tax.
- No wealth tax.
Everything you need to know about taxation in Andorra
Key areas of investment
Real estate
The Andorran real estate market is booming. European investors are attracted by the stability of the sector, clear regulations and an attractive market for residential and commercial real estate. Prices remain competitive compared to other European destinations.
Investing in real estate in Andorra
Tourism in Andorra
Tourism remains the mainstay of the Andorran economy. Investments in tourism infrastructure and leisure activities provide opportunities for entrepreneurs looking to participate in this continued growth.
Technology & Innovation
Andorra is also committed to technological development. Incentives are offered to companies operating in the technology, innovation and start-up sectors, creating an ecosystem conducive to growth and innovation.
Facilities for Investors
There are many possible investments and are compatible with international business activities. The different cities (parishes) where you can invest are as follows:
The 7 Andorran parishes:
- Andorra la Vella.
- Canillo.
- Encamp.
- Escaldes-Engordany is the location of our business centre where you can make an appointment.
- La Massana.
- Ordino.
- Sant-Julià de Lòria.
Simplified procedures
Andorra has simplified its administrative procedures for foreign investors. The business formation processes are efficient and accessible, allowing for quick and hassle-free installation.
Legal certainty
The country enjoys political and legal stability, providing investors with peace of mind when it comes to legal certainty and protection of their investments.
Quality of Life
In addition to its economic advantages, Andorra offers an exceptional quality of life, with a preserved natural environment, quality health services, optimal security for goods and people and a rich culture.
Andorra is proving to be an attractive destination for European investors seeking stability, economic growth and tax advantages. Its strategic geographical location in the heart of Europe, its political and economic stability, as well as its business-friendly policies make it an attractive option for those who want to expand their business or invest in a new economic horizon.
In short, Andorra is emerging as a promising opportunity, offering a harmonious balance between a favourable economic framework and an enviable quality of life, thus propelling investors towards new prosperous horizons in Europe.