Iberian Lawyer July August 2013 Special Focus Latin America July 2017 | Page 8

Special focus: Latin America Costa Rica’s economic stability and need for infrastructure offers potential for investment The country’s real estate and tourism sectors are also creating opportunities for lawyers, though there could be an economic slowdown ahead of the 2018 presidential elections Mariano Batalla Costa Rica is proving highly attractive to international investors due to its social and economic stability, and its high number of ongoing infrastructure projects, according to Mariano Batalla, partner at Batalla. Batalla adds that there is a pressing need for infrastructure investment in Costa Rica, and consequently opportunities abound in the sector. He adds: “There are significant transactions in infrastructure, as well as real estate and tourism.” However, Batalla also sounds a note of caution ahead of the country’s presidential elections in 2018: “In an electoral year, a slowdown in economic activity is normally expected, this year the uncertainty is compounded because of the potential adverse effects of the ‘Trump effect’.” While Costa Rica has escaped largely unscathed from the rhetoric which permeated the election campaign of the US president Donald Trump, in addition to his first six months in office, “we are all keeping a concerned eye on everything coming from the White House,” Batalla says. Meanwhile, Costa Rica´s legal market remains highly competitive, according to Batalla, who adds that law firms need to adapt in order to deal with a number of challenges. He notes that lateral hires are becoming more common and leading law firms are exploring a number of options, including further integration with neighbouring jurisdictions. However, Batalla believes there is “no threat to solid independent law firms and specialised boutiques”. He continues: “The arrival of Dentons meant that what market observers had expected for a while actually materialised, that is, international law firms landing in the region. However, the overall consensus is that no other global law firms are expected in Central America in the near future. ” Batalla adds that his firm is looking to grow in several practice areas such as corporate law, tax and real estate in order to meet the demands of international clients. Colombian and Peruvian infrastructure projects driving demand for legal services Santi Pagès Carballeda Infrastructure projects in Colombia and Peru – particularly in the energy, transport, water and sanitation sectors – are currently attracting significant foreign investment, according to Santi Pagès Carballeda, partner at Roca Junyent. He adds that economic and legal stability has improved considerably in both jurisdictions, with the result that law firms are now participating in public tenders and advising on the financing of projects, as well as advising clients on investments in projects. With regard to identifying the best opportunities that currently exist for law firms in Latin America, Santi Pagès Carballeda says it makes more sense to talk about sectors rather than countries. “There are always countries that go through cycles of expansion that make them particularly attractive to foreign investment,” he explains. “This happened with Brazil a decade ago and it’s happening today in Colombia and Peru.” 46 • IBERIAN LAWYER • July / August 2017 Meanwhile, Pagès Carballeda says that the crisis in Brazil has opened the door to foreign investment in the country in two ways. On one hand, the government has been forced to launch the Crescer programme, the focus of which includes privatisation and public- private partnerships (PPP) – this has had the effect of creating an environment that is more attractive to private investors as it seeks to reduce the associated bureaucracy. On the other hand, the Lava Jato Operation (an investigation into money laundering in Brazil) has precluded local construction companies – such as Odebrecht, Carmargo Correa, Queiroz Galvao and Andrade Gutierrez – from participating in new tenders, which has thereby created new opportunities for foreign investors. “Consequently, the difficult financial situation these construction companies face has forced them to divest major assets to foreign investors,” says Pagès Carballeda. www.iberianlawyer.com