Rethinking Regional Attractiveness in Escuintla, Guatemala

1. Assessments and recommendations

Guatemala’s regional development is unfolding within a rapidly transforming global context marked by climate change, technological innovation, demographic shifts, and the reconfiguration of the global economy. These megatrends have a direct impact on production, trade, and investment patterns, generating different opportunities and challenges across territories. These transformations can redefine the opportunities for a better insertion of Guatemala into the global economy and call for a careful understanding of how regions within a country can build on their specific potential and make the most of the changing landscape.

Understanding global transformations will be critical to realise Guatemala’s development potential and to unlock the specific opportunities of its territories

Global value chains

As global firms are reconfiguring their supply chains to reduce reliance on distant markets, near-shoring – the relocation of production closer to key markets – offers Guatemala the potential to attract investments from North American and Central American countries, seeking less distant and more resilient and cost-effective production networks. Similarly, friend-shoring – prioritising trade with allied or politically stable countries – could further enhance trade and investment relations notably with the United States (US), the European Union and Latin American economies. As these global value chains evolve it is important to highlight that nearshoring is not a self- executing solution, in particular in the context of trade uncertainty, but an opportunity that must be actively seized. Economies, at national and regional levels, must be sufficiently prepared with necessary reforms and ambitious productive development policies, including aspects like efficient infrastructure and a skilled workforce to effectively absorb, sustain, and benefit from these new global investment flows.

Guatemala’s proximity to North America, coupled with its 14 trade agreements – including DR-CAFTA and the EU Association Agreement – and the recent adherence to the Free Trade Agreement between Central America and South Korea, makes the country well placed to attract nearshoring and friendshoring investments. The United States remains Guatemala’s largest export market (32% of exports), though trade with neighbouring Central American countries has grown to 39% in total, highlighting the potential of deepening regional value chains.

However, Guatemala’s export basket remains dominated by primary and low-technology products. Upgrading towards higher value-added sectors, notably linked to agro-industry and light manufacturing, will be key. Services exports have been increasingly relevant for Guatemala and represent another area of opportunity. Specifically, travel-related services represented around a third of total services exports in 2023, and exports of business services have experienced a significant growth in the last decade, from around 5% in 2013 to more than 18% of total services currently. Ensuring that the benefits of trade reach beyond Guatemala City and major economic corridors will also require more balanced investment policies to foster inclusive territorial development.

Demographic shifts

Changes in migration patterns and policies can also have an impact on Guatemala, as remittances are a central pillar of its economy, equivalent to 19.1% of GDP in 2023 – one of the highest levels in LAC. Remittances support nearly 60% of households and have contributed to poverty reduction and economic stability. Yet, this reliance brings vulnerability: 91% of remittances come from the US, making households sensitive to shifts in migration or labour policies in this country. The spatial distribution of remittances is also uneven. The Department of Guatemala hosts the largest share of the population that receives remittances (18.7% of total), and Escuintla also receives an important share (5.4% of the total population receiving remittances), reflecting the territorial dimension of migration’s economic impacts.

Remittances not only play a major macroeconomic role but also shape labour market dynamics and household investment decisions, with implications for both formalisation and productivity. Without public policies that channel these flows towards savings and productive investment, there is a risk that they reinforce short-term consumption patterns and widen territorial disparities between communities with high and low remittance inflows. At the same time, Guatemala’s sizeable diaspora and ongoing demographic dividend offer a critical but time-bound opportunity to promote “productive remittances” and strengthen links with investment, entrepreneurship and knowledge transfer – particularly in departments such as Escuintla, where remittances, a young population and emerging industrial projects could be leveraged more effectively through well-designed financial instruments and local development initiatives.

Technological innovation

Digitalisation presents major opportunities for productivity and inclusion but also risks deepening territorial divides. Digital tools can connect remote regions to national and global markets, yet connectivity and skills gaps remain wide. Despite progress in recent years, in 2023 only 54% of Guatemalans used the internet (compared to 75% in LAC), and broadband subscriptions stood at 5.1 per 100 inhabitants – below regional and OECD averages (17 and 36 respectively, in 2023). Rural departments like Alta Verapaz and Quiché face the largest deficits. Realising digital transformation’s potential requires combining investments in infrastructure with skills training, competition policies, and inclusive innovation ecosystems.

Climate change

Guatemala is highly vulnerable to climate risks – it ranks among the LAC countries most affected by extreme weather events – yet it also stands to benefit from the green transition. While its emissions are relatively low, the transition could yield significant employment gains: net job creation in green sectors in Guatemala could increase by as much as 14.7% by 2030, in a scenario where investments increase the value added of green sectors by 3 percentage points per year. However, impacts will differ across territories, depending on industrial structures and local skills. A just, locally tailored approach is essential to avoid exacerbating inequalities and to ensure that green growth creates quality jobs nationwide.

Guatemala can leverage its unique conditions to successfully boost territorial development

Guatemala faces territorial disparities that shape its development trajectory. Evidence from the Local Competitiveness Index shows significant gaps between Guatemala’s more urbanised and connected departments – especially the department of Guatemala – and those in the western highlands and rural areas, which lag behind in competitiveness, human development, and income levels. These gaps stem from unequal access to markets, infrastructure, and economic opportunities, highlighting the need for policies that address both economic fundamentals and institutional capacity at the local level.

At the same time, the country is well positioned to seize emerging development opportunities. Its geographic location, access to two oceans, and proximity and time-zone alignment with North America and linkages with Central and South America, place Guatemala in a strong position to attract investment and trade and to engage in regional value chains. Demographic trends are also favourable: the country is experiencing a demographic dividend that will persist through 2050, offering a window to boost productivity and growth – provided Guatemala invests in education, skills, and job creation.

From a macroeconomic perspective, Guatemala has shown resilience and stability. Over the past decade, it has grown faster and more steadily than the LAC average, helped by economic diversification and strong remittance inflows. Notably, Guatemala’s growth has hovered around 3 to 4% in the last 15 years, above the LAC average. Inflation has remained moderate compared with regional peers, and the quetzal has shown stability, reinforcing investor confidence.

Guatemala’s prudent fiscal management further strengthens its outlook. With one of the lowest public debt levels in the region, the country has room to expand public investment without compromising fiscal sustainability. However, low tax revenues remain a major constraint, limiting the government’s capacity to finance infrastructure, human capital, and social protection. Strengthening domestic resource mobilisation will be essential to unlocking the country’s full development potential and ensuring that economic gains are shared across all territories.

In sum, if Guatemala leverages its strategic location, stable macroeconomic environment, and young workforce while addressing institutional and territorial gaps, it can position itself as a regional hub for sustainable investment, innovation, and inclusive growth.

Investment levels are low in Guatemala, resulting in large infrastructure gaps

Territorial challenges in Guatemala are a result of both specific conditions within regions and also general development challenges in the country. Importantly, Guatemala faces structurally low total investment levels, at around 15% of GDP on average in the last decade. This includes both domestic and foreign, public and private investment, and it remains below the levels observed in LAC on average, at around 20% of GDP. The private sector is the main driver of investment in the country: private investment represents almost 90% of total investment, well above the average for LAC countries, at 78%, and for OECD countries, at 84%. This highlights the important role of private investors in driving economic activity in Guatemala, but also the fact that there is scope for increasing public investment, as well as exploiting the untapped potential of public-private partnerships (PPPs) as a way to address important investment gaps, notably in infrastructure. In fact, Guatemala’s public investment in infrastructure is particularly low, below 1% of GDP. This represents one of the lowest levels in the LAC region, the second lowest in Central America – only above El Salvador – and it is well behind the levels observed at the OECD. Other structural factors are behind persistent infrastructure gaps, including limited strategic planning, weak institutional co-ordination, insufficient diagnostics of current and future needs, lack of technical human capital, and vulnerabilities in public procurement and corruption risks.

Improving transport infrastructure is one of Guatemala’s main development challenges, affecting both investment attraction and regional development. While 54% of public infrastructure spending goes to roads and 17% to water and sanitation, key connectivity gaps persist, particularly in rural areas. Closing the rural road access gap alone would require USD 5.3 billion annually until 2030, including maintenance. Limited road coverage restricts access to markets and public services, especially in poorer regions, while climate events further threaten transport networks, highlighting the need for resilient infrastructure and better maintenance. Logistics performance is also weak: Guatemala scored 2.6 in the 2023 World Bank Logistics Performance Index, below the LAC average (2.69), ranking 88th of 139 countries. The 2024 Priority Road Infrastructure Law (Decree 29-2024) represents progress by strengthening governance, prioritising strategic projects, enabling performance-based contracting, and modernising right-of-way regulations to reduce legal uncertainty.

Given limited public resources, PPPs will be essential to close Guatemala’s large infrastructure gaps. However, PPPs remain underused: since the 2010 PPP Law, only one project – the Escuintla–Puerto Quetzal toll highway – has been approved. On 25 November 2025, Congress approved a major reform of the PPP Law, which is now awaiting prompt presidential enactment. The reform is expected to expand PPP-eligible sectors to include education, water, transport systems, energy, ports, airports, waste management, and more. These changes aim to streamline bureaucracy, strengthen the PPP framework, and increase the efficiency of infrastructure development.

Guatemala still faces major challenges in PPP readiness, including weaknesses in regulation, institutions, project preparation, risk allocation, financing, and performance evaluation. Strengthening regulatory frameworks, project planning, financing mechanisms, and institutional capacity will be essential to attract private investment and ensure sustainable, well-managed PPPs. Infrastructure gaps also limit Guatemala’s ability to take full advantage of its strategic position between the Atlantic and Pacific Oceans. Ports – especially Puerto Quetzal, the country’s largest and a critical gateway for exports and imports – require substantial investment and reforms to support Guatemala’s integration into global value chains. In this context, advancing complementary reforms – such as the long-pending Port Law to modernise port governance and operational efficiency, and the Capital Markets Law to deepen domestic financing sources and mobilise long-term private capital – will be critical to unlocking a robust pipeline of bankable infrastructure projects.

FDI remains low and geographically concentrated, highlighting the need for enhancing attractiveness

Guatemala has historically received low levels of foreign direct investment (FDI), averaging 1.83% of GDP between 2014 and 2023 – well below the LAC average of 3.4% and the lowest within the DR-CAFTA countries, which on average receive 4% of GDP. Since 2020, FDI has been concentrated in three sectors: financial and insurance activities (29.9%), trade and vehicle repair (20.5%), and manufacturing (19.5%), each showing solid annual growth. A new FDI Attraction Strategy 2024–27 aims to position Guatemala as a competitive investment destination by promoting sustainable economic development, skills upgrading, job creation, export diversification, and investments aligned with environmental and climate goals. In terms of the origin of FDI, the country has seen a shift towards Central American countries, with 43.7% coming from Central America and the Dominican Republic in 2023, followed by the United States (15.4%) and Mexico (14.9%).

The new strategy prioritises sectors with demonstrated potential – such as processed foods, apparel, ICT, and BPOs – in the short run, while aiming to attract higher-value sectors in the medium to long term, including electronics, medical devices, biotechnology, and healthcare services. Despite its potential to contribute to regional development, FDI remains highly concentrated also geographically: between 2020 and 2024, 50% of investment projects (by capital expenditure) went to the Department of Guatemala, followed by Escuintla (18%) and Petén (8%). Job creation patterns mirror this trend, with the Department of Guatemala capturing 55% of all jobs created, followed by Escuintla (14%) and Petén (2%)

FDI also plays an important role in productivity and innovation. As in other LAC countries, foreign firms in Guatemala outperform domestic firms in productivity, product innovation, and R&D investment. However, the productivity gap is smaller than the innovation and R&D gaps, indicating that while foreign firms bring innovation, they may not be fully contributing to building local capabilities. This underscores the need for policies that enhance linkages between foreign and domestic firms – particularly SMEs – and strengthen local innovation ecosystems to maximise spillovers and deepen the development impact of FDI.

Developing skills will help attract investments and promote labour formalisation

Talent and skill development are key to Guatemala’s regional development and its ability to attract investment, as businesses seek locations where human capital drives innovation and productivity. Building a skilled workforce is also crucial to ensuring that investment translates into quality, formal jobs. This requires strengthening education and vocational training systems, while also creating conditions to attract specialised talent, including from the diaspora.

Education levels in Guatemala remain insufficient, with major gaps in access, completion, and regional equity. While primary enrolment reached 103% in 2023 – close to the LAC average of 105% – secondary enrolment was only 48%, far below the LAC average of 97% and declining from 54% in 2015‑19. Tertiary enrolment improved to 27% in 2023 but still lags behind the LAC average of 58%. Completion rates are also low: 86% in primary (vs. 95% in LAC) and just 49.7% in lower secondary, down from 63.9% in 2016. Territorial disparities are important, with basic education enrolment in the Department of Guatemala ranging from 109% to 105% for girls and boys, respectively, compared to just 30.8% and 29.2% in Huehuetenango, and to the levels in Escuintla of 77.4% and 81.7%, respectively.

Guatemala also faces weak learning outcomes. PISA 2022 results show that 15-year-olds score well below LAC and OECD averages, with the gap to the LAC average equivalent to more than a full year of secondary schooling. As much as 87% of Guatemalan students perform below Level 2 in mathematics (vs. 31% in the OECD), 68% in reading (26% in OECD), and 73% in science (24% in OECD), meaning most students have difficulties with basic interpretation, comprehension, and scientific reasoning. Despite this, Guatemala achieved the fourth largest improvement in PISA scores in LAC between 2018 and 2022. Territorial disparities persist: in 2024, according to the National Assessment Graduandos, the Department of Escuintla showed a rate of success in mathematics of 13.2%, slightly above the national average of 12.9%, and a rate of success in reading of 28%, substantially below the national average of 35.5%.

Labour markets in Guatemala are marked by persistently high levels of informality, which y weakens tax collection, limits productivity growth, undermines social protection, and traps workers and firms in low-productivity structures. In 2023, the informality rate reached 83.2% – one of the highest in LAC and stable at around 80% for the past two decades. At the household level, 60.8% of Guatemalan households have all members working informally (compared to 44.1% in LAC), while another 21.3% have at least one informal worker, underscoring the depth of vulnerability associated with household labour conditions. This household perspective is essential for understanding well-being implications for dependents. Geography and gender further shape informality patterns. In 2022, informality reached 83.1% in rural areas compared to 64.1% in urban ones.

Strengthening the talent pool will attract investments and provide better employability prospects for workers. However, firms often struggle to find qualified workers and cite skill shortages as a major obstacle. In 2018, 32.5% of firms identified an inadequately educated workforce as a severe constraint – well above the LAC average of 22.3% and the global average of 19.8%. The mismatch between labour demand and the available workforce is important: while 97% of new vacancies are in operational roles, most employers prefer candidates with university or diversified education, and 66.2% of firms struggle to find workers with the right technical skills. Informality is closely linked to low skills, with informality rates of 87.2% among workers with no education, falling to 32.5% among those with tertiary education.

Addressing these gaps requires policies that better align skills supply with labour market needs, including strengthening technical and vocational education and training (TVET). INTECAP, Guatemala’s national TVET institute, has strong potential to support regional competitiveness through upskilling, but expanding coverage and aligning training with local economic opportunities are essential next steps. Youth employment programmes such as Mi Primer Empleo can help young people transition into the formal labour market – critical in a context where transitions out of informality are rare. Scaling such programmes and complementing them with dual education initiatives tailored to regional labour market conditions would improve early career outcomes. Guatemala can also benefit from stronger mechanisms for recognising prior learning, especially given the large share of workers who acquire skills informally through self-employment or family businesses. Public employment services, including the Tu Empleo portal, also play an important role but require expanded rural coverage and more tailored regional support.

Strengthening multilevel governance for regional attractiveness

Effective multilevel governance is the essential prerequisite for translating regional attractiveness potential into sustained economic development. While Guatemala's long-term K'atun 2032 plan and institutions like CONADUR and SEGEPLAN establish a strategic national vision, the full impact of policies and investments, such as the SEZ and Industrial Park, in the development of Escuintla, is limited by structural fragmentation and a highly centralised authority.

Subnational governments (departments and municipalities) have legal responsibilities for local economic development but are hampered by limited fiscal decentralisation, relying heavily on often-delayed central transfers. This financial dependency, coupled with weak technical capacity, undermines their ability to execute policies and attract investment at the required scale. Governance in Escuintla, though strategically vital, reflects this challenge: while the departmental plan aims for multi-actor collaboration, limited evidence exists of structured inter-ministerial mechanisms explicitly designed to coherently integrate sectoral policies (infrastructure, education, environment) in a place-based approach. Strengthening the effectiveness of local governance structures, particularly the CODEDE and COMUDE councils, and ensuring co-ordinated public-private engagement is imperative to overcome these vertical and horizontal co-ordination gaps, empower local authorities, and ensure that regional development strategies are locally responsive and fully aligned with national priorities.

Currently, there are initial discussions about a possible regulation model for the attraction and retention of investment at the municipal level in Guatemala. This instrument should serve as a guide for municipalities to adapt and apply according to their specific context and degree of autonomy, thereby fostering an enabling environment for private investment and comprehensive local development.

Escuintla performs strongly in economic terms, yet significant challenges remain across other key dimensions of regional attractiveness

Based on available and sometimes limited information, Escuintla’s Regional Attractiveness Compass1 highlights the strong economic performance of Escuintla evidenced by the second highest GDP per capita nationally. High rates of perceived entrepreneurial opportunities are constrained by deficits in human capital and resident well-being, preventing the region from reaching its full potential as an international investment hub. The critically low tertiary education attainment is a decisive bottleneck, evidenced by a low rate of only 3.4% of the population holding a tertiary degree (compared to the OECD average of 33.7%), positioning Escuintla near the bottom of OECD benchmarks and hindering its ability to attract and sustain higher-value sectors (e.g. electronics or medical devices) targeted by the new FDI strategy. Furthermore, the department's highest national homicide rate (43 intentional homicides per 100 000 inhabitants, nearly triple the OECD LAC median of 18.1) and low safety perception directly impact talent attraction and retention, acting as a barrier to business climate perceptions. Therefore, policy efforts must prioritise strategic security, and civic engagement plans to restore safety, alongside targeted investments in technical and vocational education to rapidly align workforce skills with evolving industrial demand.

To maximise the economic output from key industrial assets like its strategic coastal location and new SEZs, Escuintla must urgently address its connectivity and environmental sustainability challenges. Despite strong digital social engagement, the limited broadband penetration (only 15.1% of households connected) and poor-quality transport infrastructure (with only an estimated 45% of roads paved) act as significant barriers to business efficiency and market access, placing the department substantially below OECD and LAC averages for connectivity. Policy must mandate co-ordinated infrastructure investment, prioritising digital backbone and road quality improvements to unlock mobility and reduce logistics costs. Simultaneously, the region's long-term appeal is undermined by deficiencies in environmental management, particularly the inadequate wastewater treatment and high air pollution. Integrating binding environmental standards and sustainable waste management practices into the regulatory frameworks of new industrial parks and mandating a transition away from non-renewable energy sources (which account for only 9.7% of electricity generation) to improve land resilience and secure sustained compliance with national and global climate goals is essential.

Place-based industrialisation as an instrument for inclusive and sustainable development

Place-based policies, encompassing tools such as Special Economic Zones (SEZs) and Industrial Parks (IPs), offer regulatory and fiscal incentives within designated geographic areas to stimulate economic activity, attract investment, and foster industrial growth. While widely adopted globally – with over 7 000 SEZs operating – analysis establishes that their developmental impact is fundamentally dependent on effective design, robust governance, and deep integration into the surrounding territorial strategy. Place-based industrialisation policies should not be viewed merely as tools for national industrial objectives, but as instruments for regional development that generate lasting benefits for their host regions. On the other hand, many zones fail to deliver meaningful regional spillovers due to weak linkages with local economies and insufficient policy co-ordination. Robust, multi-level governance and oversight are paramount to preventing negative externalities such as environmental degradation, labour exploitation, and illicit trade, thereby ensuring economic activity genuinely contributes to sustainable development, especially when considering regional strategies for areas like Escuintla.

The long-term success of place-based policies centres less on short-term tax relief and more on sustained commercial viability. Evidence suggests that fiscal incentives alone are insufficient to drive performance, as their effectiveness as a competitive advantage has diminished due to standardisation across countries. Strengthening non-fiscal attractiveness measures, including the provision of quality infrastructure (such as specialised land, access to skilled labour, and targeted regulatory easing) and effective investor servicing, are key factors. By consciously aligning operational goals with the host region's broader development objectives, private actors can effectively mitigate political and operational risks, secure essential local support, and establish the deep, resilient integration necessary for sustained commercial viability – ultimately delivering a larger and more durable return than can be achieved through purely short-term fiscal advantages. Crucially, zone-based policies are not a self-executing solution for regional challenges, but they can deliver long-term benefits when embedded within a comprehensive reform strategy that amplifies a region’s existing comparative advantages and strengthens its absorptive capacity through investments in skills development, infrastructure, and improved access to finance.

Integrating sustainability and co-ordination into Guatemala’s production transformation policies

Guatemala currently operates 19 industrial parks and the country is actively working to integrate environmental sustainability into its national production transformation policies. This effort includes developing a system of public and private incentives and creating a specialised working group to design a regulatory framework for Sustainable Industrial Parks. This approach, highlighted by the National Strategy for FDI, demands critical inter-institutional co-ordination between the public and private sectors to attract high-impact investment, marking a necessary shift toward comprehensive territorial development strategies over mere short-term economic gains.

The existing framework is structured via a three-tiered system including ZOLIC, Free Trade Zones (Zonas Francas), and ZDEEP (Zonas de Desarrollo Económico Especial Públicas) to facilitate trade and promote industrial development, aiming to create a competitive environment for both local and foreign investors.

Within the Guatemala national context, the Department of Escuintla has emerged as a crucial area for ZDEEP development, currently hosting eight ZDEEPs, with four operational. These zones, spanning vast areas, are projected to generate over 100 000 direct and indirect jobs, underscoring their vital role in boosting regional economic dynamism. However, achieving this job creation goal and ensuring equitable territorial development requires robust spatial planning, effective co-ordination across multiple levels of government, and coordinated infrastructure investment.

Maximising the impact of Synergy Industrial Park

The Synergy Industrial Park, a large-scale, private sector-led initiative spanning approximately 500 hectares in Escuintla, represents a significant opportunity to shift the regional economic trajectory. Its strategic positioning near major highways (CA-9, RN-14) and its goal to attract high-value sectors, including medical devices and data centres, can help leveraging Escuintla’s comparative advantages. Synergy Industrial Park’s commitment to environmental sustainability – exemplified by its use of renewable energy from sugarcane waste, plans for solar installations, and pursuit of LEED for Communities certification – sets a high standard for green industrialisation. With 17 client companies already securing land and 1 800 new direct jobs generated to date, Synergy Park demonstrates the feasibility of attracting significant investment.

The commitment of the Synergy Industrial Park to the broader development objectives of Escuintla and Guatemala sets a vital precedent for future investment. To maintain this trajectory and guarantee the region receives the full spectrum of benefits, including specialised skill development and sustainable economic growth, Synergy Industrial Park is encouraged to strategically deepen its efforts. Specifically, Synergy and its private sector operators must ensure its operational model prioritises sustained, proactive investment in local linkages, thereby solidifying knowledge transfer and equitable wealth distribution to deliver lasting integration. To achieve this, the private consortium must fully integrate robust mechanisms for community involvement and human capital development. This involves systematically training local workers to meet the specialised needs of incoming industries and actively integrating local firms into the supply chain. Furthermore, Synergy Industrial Park must deepen its commitment to multilevel governance beyond mere regulatory compliance, ensuring a transparent governance model – particularly for critical resource allocation like water management – that actively involves local authorities and community stakeholders. Addressing the current data gaps on the local labour market’s skills profile, in partnership with the public sector, is a crucial first step toward aligning workforce development with industry requirements and ensuring the Synergy Industrial Park successfully fosters truly inclusive regional development.

Table 1.1. Policy recommendations: Synthesis and examples of good practices

Recommendations			Good practices
Strengthening infrastructure while ensuring climate resilience	Improving transport and logistics	Expand and modernise road networks through public and private investment	OECD Recommendation on Effective Public Investment Across Levels of Government. Colombia adhere to the Recommendation and their main structure device for co‑financing are the Contratos Plan.
		Upgrade road quality, prioritising rural infrastructure to improve accessibility	Chile – Arica and Parinacota Region: Under the PEDZE the government implemented a logistics and transport infrastructure programme to improve regional connectivity and competitiveness, including road upgrades and port access to better integrate the region into national and cross-border trade networks. The Port of Valparaíso in Chile with joint efforts from the state and private sector, increase cargo throughput and operational efficiency.
		Review and streamline public private partnerships and concessions (including municipalities) for infrastructure development
		Strengthen port infrastructure to enhance trade and connectivity
	Developing climate-resilient and sustainable infrastructure	Integrate climate resilience and risk management into infrastructure planning	Brazil has implemented a Community Risk Plan, while China – with support from the World Bank – has developed a Low-carbon and Climate-resilient Residential Community model in a subdistrict of Shanghai. (G20/OECD report on approaches for financing and investment in climate- resilient infrastructure).
		Strengthen water governance and management systems	OECD Principles on Water Governance
		Expand renewable energy infrastructure to support economic and environmental goals, coupled with context-based research and development on infrastructure and materials	The Ministry for the Ecological Transition in France introduced the RE2020 regulation in 2022, requiring new buildings to meet energy efficiency and carbon reduction standards, while improving resilience to extreme heat, in response to rising climate risks.
Driving local economic development and social inclusion	Skills development	Strengthen vocational training and technical education to align with labour market needs	National Institute of Learning (INA), Costa Rica: Aligning Technical Training with Private Sector Demand
		Engage skilled diaspora to transfer expertise	Morocco created platforms like FINCOME and Maghrib.com to connect skilled diaspora with national development efforts and job opportunities back home.
	Promoting inclusive economic opportunities	Ensure local and marginalised communities benefit from new industrial development projects (e.g. SEZs, industrial parks)	In LAC regions cooperativism offers a starting point for entrepreneurs to upscale economic activity through association or by developing co-operative forms of joint self-employment such as worker co-operatives to encourage formalisation, achieve economies of scale, and improve access to social protection programmes. Mexico applies the Triple Helix model to foster collaboration between government, industry, and academia, promoting innovation and inclusive growth. In regions like Monterrey and Ciudad Juárez, it has helped align training with labour market needs and support local development.
		Enhance the appeal of formal employment for young people and women to reduce emigration, informal work and illicit activities
Developing a long-term investment strategy and institutional framework	Strengthening FDI strategies	Enhance co-ordination and role definition in investment promotion and territorial marketing	Tunisia assesses overlaps among its three investment agencies – APII, FIPA, and TIA – to help evaluate the potential benefits and trade-offs of institutional consolidation. This approach supports more effective co-ordination and strategic alignment in investment promotion.
		Promote tailored FDI attraction strategies through empowered municipal alliances:	(Ireland) South-East Regional FDI strategy: FDI strategy for a small region which markets their assets from talent to natural capital - ranked #1 for small regions FDI strategies by the Financial Times
	Leveraging nearshoring and global trade opportunities	Maximise and diversify trade agreements and international partnerships to improve market access	Canada’s dedicated national agency for attracting Foreign Direct Investment Invest in Canada’ Hub promotes Canada as an investment destination by integrating national and regional efforts Mexico has become a leading destination for manufacturing centres serving North America, with nearshoring driving demand for industrial space in border regions.
	Advancing green and sustainable investment	Increase the adoption of green and innovative financing tools	LEED certification is a standard for sustainable building and industrial development, promoting energy efficiency, resource conservation, and environmental responsibility. Countries such as India and Brazil have developed LEED-certified industrial parks and commercial zones to attract environmentally conscious investors and support their green growth agendas.
		Promote eco-friendly industrial parks with sustainability certifications to attract green investment
Improving governance and regulatory effectiveness	Enhancing institutional capacity and co-ordination	Simplify and improve public procurement processes to increase transparency and efficiency	The Secretariat of Public Management (SGP) of Perú within the Presidency of the Council of Ministers (PCM) led advancements in transparent e-procurement, prioritising openness, data management, and digital platforms like SEACE to improve public spending accountability
		Strengthen anti-corruption measures and accountability mechanisms	The Consorcio de la Zona Franca de Barcelona (CZFB), Spain, became the first free trade zone globally to receive the OECD Free Trade Zone (FTZ) Certification, setting a benchmark in transparency, innovation, and secure international trade. Costa Rica has recently begun the process to become part of the OECD FTZ Certification Scheme, reaffirming its commitment to international best practices in governance, transparency, and sustainable trade facilitation. Ukraine – Digital Restoration Ecosystem for Accountable Management (DREAM), a national platform supporting project planning, appraisal, and implementation. DREAM is fundamental to operationalising Ukraine’s new public investment management system.
		Improve co-ordination between national and subnational governments to enhance policy implementation	Through the OECD Council Recommendation for effective public investment across levels of government.
		Fostering Collaborative Governance through a steering committee	China – some industrial parks have put in place an evaluation system for Corporate social responsibility
	Boosting transparency and evidence-based decision-making	Improve the availability and quality of subnational data for informed policymaking	PARIS21, supports low- and middle-income countries in strengthening national and subnational statistical systems to inform inclusive development. It promotes strategic planning, better co-ordination, and improved data governance to address spatial inequalities and guide territorial policymaking.

Note

← 1.  Based on the OECD Regional Attractiveness Compass, with benchmarking against both general OECD regions and OECD LAC member countries.