Spain spearheads international investment opportunity

Spain spearheads international investment opportunitySpain has come out as the second best country in the world to invest in in a recent study from New Jersey based research firm Bretton Woods.

They also found that Europe as a whole was turning into a better and better bet for those looking to buy into the stock market.

Research leader Vladimir Signorelli said: ‘We see economic conditions improving for Europe. Four of our top ten stock markets are in Western Europe where fiscal policy is improving, like tax rates getting reduced.”

The report contains positive reading for European countries most hit by the fall-out from 2008. The number one market to invest in was seen as Portugal while Ireland took the number four spot.

The main reason for investing in Spain, the company has said, is that it is in a position to outperform any other Eurozone recovery pattern. Its fiscal policy has improved, corporate tax rate reduced this year from 30 per cent to 28 per cent and the top marginal tax rate on income was reduced from 56 per cent to 47 per cent. This is expected to fall even further this year and could yet hit 45 per cent.

EVALUATING THE OTHER PLAYERS 

According to Bretton Woods, Portugal leads the way in recovery in the Eurozone, helped by its top corporate tax rate which dropped to 21 per cent from 23 per cent.

Bretton Woods justified their position of Ireland in fourth place saying, ‘Ireland is home to one of our favorite stock markets, and it should outperform in any European recovery scenario.’ One of the strengths of the country was that it left the bailout agreement in 2013. This meant that it was able to avoid some anti-growth measures other countries had to adopt such as raising the tax rates for individuals. The country also has a very low corporate tax rate of 12.5 per cent.

Germany came in fifth in the table created by the research with no major fiscal policy changes expected in the near future.

Considering emerging markets, Bretton Woods has a particular soft spot for China and India. Chinese authorities have targeted growth of 7% this year and most experts believe they’ll get there. Signorelli said: ‘We’re bullish on China and still love India even though it is unclear whether the new corporate tax rate means less taxes for big business or more,’

HOW BRETTON WOODS CRUNCHED THE NUMBERS

However, none of the above should be seen as a guarantee of how the markets studied will actually play out. In its studies, Bretton Woods uses supply side economic theories to help decipher market strength.

This is a macroeconomic theory which says economic growth can be best stimulated by investing in capital while easing the process of production of goods and services. This means that consumers will have a greater supply to choose from and at lower prices, creating a happier and more prosperous market.

For more information, please contact corporate law firm Argali Abogados.

 

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