4) Why is the ZEC Perfect for Businesses?
Defined as the European California, the beautiful climate is just one of a huge list of reasons to move to the islands it is not hard to see why so many people are choosing to set up in the ZEC. Below is a few of the factors that help entities make their minds up:
Low Operational Costs
The ZEC captures the best elements of Europe, with the beautiful climate of North Africa and incredibly reasonable operational costs. Companies who are looking into setting up or working within the ZEC would be naive to ignore the importance and value of developing a business within these Island chains. Below are just a couple of examples that show the sheer differences between central Europe and the ZEC.
The Canary Islands boast cheaper petrol than Spain, UK, Germany and Ireland with an average of under €1 per litre. Office rent is vastly cheaper than the majority of European cities, for example €/m² averages at around 15 euros, whereas London is 90 euros, Madrid is around 30 euros and Berlin is 22 euros.
Just from these examples it is clear how even small businesses can experience huge differences in their operation costs within the ZEC.
High Quality Workforce
It’s obvious that any business that is starting up would want to research and understand the workforce in that area, it would be short sighted for a company to set up in the location without first thi ZECnking about their long term goals, objectives and growth. Below is a brief look into the talent that is within the ZEC.
The Canary Islands provide a perfect place for companies searching for quality local talent, with great opportunities to grow and develop the workforces either via the 5 universities within the ZEC or enticing foreign talent. With 5 universities (2 public, 3 private), 39 international schools and around 180 professional training centers, local talent is not hard to find within the ZEC.
Around 10% of all of Spain’s yearly graduates are actually from Tenerife in fields from Law, Health Sciences, Maths, Business, Tourism, Telecom and many more!
Looking externally, the islands are a hotspot for attracting highly skilled foreign workers, with a large percentage of inhabitants being international, with the majority knowing at least 2 languages, a trait invaluable in the business world.
The Canary islands are renowned for retaining and attracting talent due to a number of factors such as the timezone (GMT), the yearly average temperatures of 22c (72f) and the highest sun hours in the whole of Europe! Thus providing investors, business owners and entrepreneurs with highly qualified, multicultural and intelligent talent.
Connected to the World
As aforementioned the ZEC is connected to the major trade routes by air and by sea. Due to the exceptional connectivity and technological superiority of this zone, the ZEC has the perfect requirements to become a potential Air Hub for organizations that have operations between Europe, Africa and America.
The islands and especially Santa Cruz in Tenerife, are known for their innovations and technology, with submarine fibre-optic cables, 50 satellites and major telecommunication companies operating within ZEC, it’s the perfect place for a startup or business to grow.
The D-ALiX project has created a ‘bridge’ linking Africa with Europe and America, the aim of which is to improve the competitiveness of the ZEC within the IT market and improve the technological resources of the ZEC even more.
ZEC Tax Advantages
The Canary Islands boast the ‘best taxation rate in the EU’. As the Canary Islands are an EU outermost region, they have their own economic and fiscal system, which is approved by the European Union, applying double taxation conventions and fiscal transparency.
The corporate tax rate of 4% is much lower than the majority of EU countries with the average being 22%, with such extremes of Germany, Belgium and France at over 30%.
The aforementioned economic and fiscal system or ‘regime’ offers compelling incentives for businesses who create, establish and grow their companies within the Canary Islands.
The opportunity to pay lower corporation tax rates at the unique tax rate of 4% for ZEC companies is just one of these incentives. Companies can also reduce up to 90% of undistributed net profits from taxable bases. There is also a 50% allowance for tangible goods production within the ZEC. Tax Credits are also offered for investments in sectors deemed the most strategic and profitable compared to the rest of Spain.
Within the ZEC zone there are also multiple exemptions in direct taxation: from the original setting up of the company, to increasing capital, to acquiring investment locations and properties and to the general rate of Canary Islands General Indirect Tax (VAT) of 7%.
Certain areas also carry unique economic advantages for exporting, importing and the inward processing of tangible goods.
Europe in Africa
The ZEC has all of the advantages of being in Europe but is located just under 100km off of the North West of Africa. The ZEC has all of the services, infrastructures and advantages of being within Europe while enjoying a unique geostrategic location to extend operations effortlessly into Africa.
With over 40 weekly air connections with cities in West Africa, connections to all of the ports in the area and a neutral internet exchange linked with Africa, the continent really is just a stone’s throw away.
The Canary Islands have accumulated an impressive knowledge base over a wide range industries due to the highly talented workers who are either from the ZEC zone or have been attracted to it over the last 20 years.
The ZEC have a surplus of high quality talent and have great potential to meet and exceed the needs of companies looking to set themselves up within the ZEC zone.
The quality of life within the Islands is comparable with the best areas in Europe. With first class European Health and Education, one of the nicest climates in the world averaging at 22c/71f across the year and diverse cultural, leisure and business offerings.
Everyone on the Island embraces the warm, cosmopolitan and fun atmosphere that truly encapsulates the best of the ZEC, and the fact that the area has the most celebrations and festivals in Europe doesn’t hurt either!
Higher Job Satisfaction
More and more companies are concerned about what they offering their employees, and strive to keep them for a long time, with factors like work-life balance, cost of accommodation or commute time, it can be hard to keep your workers satisfied.
People who come to work in the Canary Islands find themselves enjoying their jobs much more due to the beautiful location, when you’re always close to a world class beach, fine dining or striking natural parks it’s not hard to see why!
The ZEC is often said to have the best climate in the world and having spring temperatures throughout the cooler months and a summer that attracts millions of tourists a year! Within the ZEC there are 141 protected natural areas, 4 biosphere reserves, 25 golf courses, and around 160 miles (255km) of beaches!
It is not just the geographical factors that aid in high job satisfaction but also the people too, everyone who visits, inhabits or works in the ZEC can shortly adapt to the tranquil days, the exciting fiestas and the positivity that brings people back to the islands year after year.
The ZEC is renown for their gastronomy and the locality, freshness and quality of their ingredients and produce. Due to the relatively low living costs in the Canary Islands even the finest dining is completely affordable, Canarian cuisine has influences from all over the world, making the ZEC a food lover’s paradise!
On top of everything else, the islands get an average of around 300+ sunny days a year, so it is not difficult to see why the Canary Islands have been attracting, nurturing and growing businesses for over 2 decades.