A Services Policy Review examines economic and trade policy aspects of selected services sectors identified by the Government and provides an evidence-based approach to policymaking on services by reviewing policy, regulatory and institutional issues and options with a view to assisting the beneficiary in developing a coherent and comprehensive strategic framework for services. In close partnership with the Government, research undertaken by UNCTAD and at the national level is integrated into the results of national stakeholder consultations to yield policy recommendations for action.
The Government of Nicaragua identified the following four services sectors to form the focus of this Services Policy Review: financial services; tourism services; telecommunication services; and road transport services. These services have the potential to contribute significantly to the future growth and development of the economy.
The main findings of this Services Policy Review include the fact that the development of services sectors is limited in Nicaragua by the lack of a strong institutional framework and the insufficient development of associative schemes to promote cooperation among small and medium-sized enterprises. The integration of service activities in value chains may also be restricted by an insufficient supply of skilled labour and the underdevelopment of infrastructure and support services.
In recent years, Nicaragua has been actively involved in negotiating trade agreements within its regional bloc. This Services Policy Review emphasizes that in order to realize the full potential of trade agreements there is a need to have more concerted action between the national and regional levels regarding the negotiation and implementation of agreements, regulatory cooperation and economic support. Regarding trade in services in particular, it is necessary to strengthen institutional aspects and coordination and promote human capital development and sector upgrading.
Proposed recommendations for improving the contribution of the specific sectors analysed in this Services Policy Review include the following, among others:
Consider the possibility of creating a full-fledged development bank, according priority to financing for small and medium-sized enterprises.
In the financial services sector, establish a centralized credit history repository in order to ease the credit applications process and assessment of potential customers’ creditworthiness.
Develop a quality assurance framework, encompassing a mandatory evaluation of tourism services operators and facilities necessary to obtain a mandatory permit to provide their services prior to starting operations.
Promote the concept of shared responsibility of operators and regulators of telecommunications services, with respect to the handling of consumer complaints.
Create a national programme, supported by private banking institutions, to finance road transport services providers.
