Page 63 - economic report 2021

In 2021, Spain concentrates 23% of FOREIGN INVESTMENT BY COUNTRIES
foreign investment in Andorra, whereas AND SECTORS. 2021 - As % of total Chart 7.11
France only represents 4%.

50% is held by non-resident shareholders
who are making a new investment. Denmark
is the fourth foreign country with most
investment in Andorra (with only 1.5% of the
total figure), almost the same as the United
Kingdom (also with 1.5%), followed by Russia
(which represented 1.1% of total investment
in 2021). The rest is divided between various
geographical locations and of little significance.

Globally, since the current Foreign Investment
Law came into force in 2012, Spain has had
an average concentration of 32.9% of the total
value of investments formalised in Andorra,
and France 13.6%. The rest is divided between
many countries, notably Luxembourg (3%),
Russia (1.9), Belgium (1.7%) and Ireland (1.7%).
Investments where “Andorra” is identified as
the country of origin represent an average of
15.3% of the total over the period 2012-2021.
61
By sectors, formalised foreign investment in
2021 was notable in property (from €75.6 (*) Andorran businesses with foreign capital (>50%)
making a new investment.
million in 2020 to €436.4 million in 2021),
representing 81% of total investment. The next Source: Ministry of the Presidency, Economy and Enterprise.
most important sectors were business services
activities (8% of the total) and projects, design In 2021, foreign investment saw
or research (5%). The other sectors are only signif cant growth in all sectors, except
2% or less of total investment in this year.
Nevertheless, the 2021 investment data saw property development and construct on.
very significant growth in all kinds of activity,
except in real estate and construction (-58.7% since 2020). On analysing the period 2012-2021, the
four sectors that received most investment were property (50.5% of the total), business services
activities (17.4%), real estate and construction (12.1%) and the commercial sector (8.4%).

At the beginning of July 2022, the Bill to amend Law 10/2012 on foreign investment entered
into parliament with the aim of improving the attractiveness of Andorra for new sectors and
businesses and also to provide appropriate protection for strategic sectors. The legislative reform
is based on four pillars. Firstly, the bill introduces a system for liberalising certain investments The Andorran economy: general developments | VII. The foreign sector
to facilitate foreign investment. Secondly, all foreign investments must file a declaration to the
Foreign Investment Register once they are realised. Thirdly, an effective control mechanism is
installed, and finally, a disciplinary system is established. Investments from countries with a double
taxation agreement or countries sharing a collaboration agreement on foreign investment can start
the process without prior authorisation from the Government, but controls will subsequently be
carried out to verify compliance with the necessary requirements. Excluded from this procedure
are investments in sectors under special protection, such as critical infrastructure or technologies,
including those related to energy, transport, media, A.I. or robotics.