United States Department of State

Costa Rica is located in Central America. Costa Rica's investment climate has been for many years generally favorable. Consequently, foreign direct investment is high and has been a significant contributor to Costa Rica's economic growth. The country's legal and cultural environment continues to present stumbling blocks to investors. Nevertheless, challenges to the country's competitiveness, including rising operating costs, a complicated legal environment, excessive bureaucratic red tape, and infrastructure deficiencies, are fueling caution on the part of investors. Costa Rica's continued popularity as an investment destination is well illustrated by historic FDI which climbed steadily from the year 2000 (USD 409 million) to 2008 (over USD 2 billion), and reaching a high of over USD 2.6 billion (5.4 percent of GDP) in 2013 before dropping back to USD 2.1 billion in recently released figures for 2014. In recent decades the Costa Rican government has focused on attracting relatively high-tech manufacturers and service companies that demand skilled labor, introduce new technologies and often run robust Corporate Social Responsibility (CSR) programs. The vast majority of these companies establish themselves in Free Trade Zones that enjoy certain fiscal benefits. Consistent with this orientation, the Costa Rican government was aggressive in signing free-trade agreements, tax information agreements and generally participating in the global arena under former President Laura Chinchilla. The current Solis administration, which took office on May 8, 2014, has been aggressive in seeking FDI inflows and has prioritized foreign visits to potential investors in Asia, Europe and the Americas. Despite years of trade liberalization, the Costa Rican economy is not as advanced as this export-led development might suggest. The legal system, while solid and generally uncorrupt, can be very slow and often disappointing. Invasion and occupation of private property by squatters, who are often organized and sometimes violent, does occur in Costa Rica. The Costa Rican police and judicial system have at times failed to deter or to peacefully resolve such invasions. Much of Costa Rica's basic infrastructure - ports, roads, water systems - needs major upgrading. In a significant step forward for port infrastructure, Dutch-based APM Terminals broke ground in early 2015 on its long-delayed USD 1 Billion megaport on the Caribbean coast. Private-public partnerships as well as concessions continue to face numerous legal and procedural challenges that have delayed, or in some cases, canceled key infrastructure projects. Even China, which has sought to invest in two major infrastructure upgrades, has seen these projects stalled by bureaucratic and legal concerns.

Guyana is a country located in South America's North Atlantic coast. During 2014, Guyana's investment climate showed no signs of recovery from the downward turn of 2013. Political gridlock and infighting hampered the country's development efforts on several fronts. The Amaila Falls Hydropower Project, which would have been the largest capital project in the country's history, fell apart after a decade of planning when U. S. developer and equity partner Sithe Global withdrew from the multinational development team in August 2013. The company had concerns related to political risk following objections to the venture by the country's largest opposition party. Guyana has failed to crack down on money laundering, and parliament has been unable to pass legislation strengthening Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) laws. Consequently in November 2014, the Caribbean Financial Action Task Force (CFATF) recommended that its members implement counter measures to protect their financial systems from the ongoing money laundering and terrorist financing risks emanating from Guyana. CFATF also referred Guyana to its parent body, the international Financial Action Task Force (FATF), for review. Although FATF has not concluded its review of Guyana, consumers and importers are already complaining of increased costs and delays in processing international financial and trade transactions. The government continues to encourage foreign investment but with limited success outside of the gold mining sector. Perceptions of corruption, inefficient government, inadequate infrastructure, and crime remain barriers to attracting foreign investment. Early general elections were held on May 11, 2015. The APNU-Alliance for Change party won 33 out of 65 seats in the National Assembly and David Granger was sworn in as President on May 16th, 2015. The impending elections slowed down current and prospective investment since implementation of many governmental projects were either put on hold or curtailed, until after the elections. Presentation of the National Budget, which has a constitutional deadline of April 30th, was also affected.

The Netherlands consistently ranks among the world's most competitive industrialized economies. It offers an attractive business and investment climate and remains a welcoming location for business investment from the United States and elsewhere. Distinguishing strengths of the Dutch economy include the Netherlands' stable political and macroeconomic climate, a highly developed financial sector, strategic location, well-educated and productive labor force, and high quality physical and communications infrastructures. Investors in the Netherlands take advantage of its highly competitive logistics industry, anchored by the largest port (Rotterdam) and fourth-largest airport in Europe. In telecommunications, the Netherlands has the highest internet penetration in the European Union (EU) and hosts the largest data transport hub in the world. The Netherlands is the largest recipient and source of foreign direct investment in the world and the largest historical recipient of direct investment from the United States. This position reflects the Netherlands' competitive economy and a tax climate that many corporations find favorable. The majority of investment flows to the Netherlands are not ultimately destined for the Dutch market, but rather pass through the Netherlands en route to another destination; nevertheless, the Dutch economy is characterized by a high degree of foreign investment in a wide range of sectors including logistics, information technology, and manufacturing. In the past year, the Dutch government has begun implementing significant reforms in key policy areas, including the labor market, the housing sector, the energy market, the pension system, and health care. Reflecting common Dutch practices, these reform policies were crafted following close consultations with key stakeholders, including business associations, labor unions, and civil society groups. Following a protracted recession that ended in late 2013 and anemic GDP growth of 0.8 percent in 2014, the macroeconomic outlook in the Netherlands is more positive for 2015 and 2016. The Dutch government projects economic growth of 1.7 percent of GDP in 2015 and 1.8 percent in 2016. Projected drivers of growth include increased exports and business investments, as well as newly invigorated domestic consumption.

The Republic of Kosovo declared independence from Serbia in 2008. Kosovo's neighbor to the north, Serbia does not recognize it as a sovereign state, but has begun to normalize relations in accordance with the Brussels Agreement of April 2013. With a population of 1.8 million and land area 6,765 square miles, landlocked Kosovo is considered Europe's poorest country, yet it does have some mineral and coal deposits. Kosovo's official unemployment rate is 30.9 percent, although some estimates are as high as 45 percent. In an effort to foster economic development, the Government of Kosovo (GoK) has implemented reforms to improve the investment climate, prompting improved rankings in the World Bank's Doing Business reports from 81 (2014) to 75 (2015). Kosovo is continuing efforts to transform its socialist legacy to a market-oriented economy, and the GoK is working to strengthen the legal environment necessary to attract and retain foreign investment. Corruption, practiced and perceived, and a lack of contract enforcement create high barriers to foreign investment. According to the World Bank, Kosovo's economy is characterized by: limited integration into the global economy; the success of its Diaspora in foreign labor markets, resulting in a steady stream of remittances; pro-growth budgetary priorities; and continued international financial support. Vocal political opposition to the government's privatization policies, corruption, political or self-interested interference by government officials, disagreements over asset ownership between Kosovo and Serbia, and unreliable energy supply increase the risk and cost of investments in Kosovo. Despite these challenges, Kosovo's relatively young population, low labor costs, and abundant natural resources have attracted foreign investment, with several international firms and franchises already present in the market. There are opportunities for U. S. businesses to invest, especially in the food, IT, infrastructure, and energy sectors. The newly-elected government is seeking to further improve the business climate through the adoption of a multi-year development program focused on providing incentives for economic growth. These include amendments to tax and foreign investment legislation. The banking sector in Kosovo is stable and liquid, but high interest rates stifle commercial endeavors, prompting the government to enter into credit-guarantee arrangements with international donors to improve access to credit for businesses.

Macedonia's government welcomes and seeks out foreign investors. The Prime Minister regularly leads investment roadshows and has charged multiple Ministers and agencies with promoting Macedonia as an investment destination. Macedonia's legal framework for foreign investors is generally in line with international standards. However, investors complain that many laws are enforced unevenly or not at all, and corruption is widespread and largely goes unpunished. Bureaucracy and lack of communication and capacity within the government also frustrate investors. The judicial system is slow and many investors and citizens of Macedonia believe it to be corrupt. Foreign investors also complain that it can be challenging to secure visas for foreign managers and employees. Macedonia generally has been free from political violence for the past decade. However, interethnic and inter-religious tensions remain and are often aggravated by political rhetoric.

The Palestinian economy is small and relatively open, with several large holding companies dominating certain sectors. Palestinian businesses have a reputation for their professionalism as well as the quality of their products. Large Palestinian enterprises are internationally connected, with partnerships extending to Asia, Europe, the Gulf, and the Americas. Due to the small size of the local market, access to foreign markets through trade is essential for private sector growth. However, restrictions on the movement and access of goods and people between the West Bank, the Gaza Strip, and external markets imposed by the Government of Israel (GOI) continue to have a deleterious effect on the private sector and limit economic growth. Private sector opportunities are constrained in Gaza due the de facto rule of Hamas, which has been designated as a foreign terrorist organization (FTO), combined with GOI restrictions on many imports and most exports. Since 2007, the West Bank's economy has made significant progress- primarily due to improved security, economic and legal reforms, international donor support and the easing of GOI restrictions - economic growth slowed drastically during 2013 and contracted in 2014. Gross Domestic Product (GDP) growth in the West Bank and Gaza was 2 percent in 2013 and in 2014 declined to nearly 1 percent, down from a combined average 9 percent GDP growth in 2010- 2012. According to international organizations, the decline in 2014 is mainly a result of that summer's conflict in Gaza, the ongoing political conflict with Israel, the uncertainty in the Palestinian Authority's (PA) ability to pay salaries, and the accumulation of high levels of private sector arrears. In 2014, donor countries provided the PA USD 1.030 billion to support its budget, about USD 297 million short of the amount needed to cover the PA's recurrent deficit. Future economic growth depends on a series of factors; an easing of Israeli movement and access restrictions, further expanding external trade and private sector growth, improved PA governance on commercial regulation, political stability, Israel prompt releasing the PA's customs and VAT revenues, and the general recovery of global and regional economic growth. Economic sectors that are not dependent on traditional infrastructure and freedom of movement, such as information and communications technologies (ICT), are able to grow somewhat independent of these factors, enjoying greater success in the Palestinian territories during the past decade. According to the Palestinian Bureau of Statistics (PCBS), the unemployment rate in the Palestinian territories is 26.5 percent, with a disproportionate effect on youth: between the ages of 20-24 where unemployment is at a rate of 45.6 percent. In addition, the workforce is expected to significantly expand in the coming years as 47.1 percent of the population of the West Bank and Gaza is currently below the age of 18. The labor force is relatively well-educated, boasting a high literacy rate, with high technology penetration and familiarity with overseas markets. Wages are low relative to Israel, but higher than other neighboring Arab countries. In January 2013, the PA implemented the first Palestinian minimum wage, set at NIS 1,450 (USD 389) per month. Palestinians remain dependent on the public sector, which employs 22.9 percent of the workforce. The PA depends primarily on the transfer of its customs and VAT revenue, which Israel collects on the PA's behalf, to cover its operational expenses, including its wage bill.

Several key factors make Slovenia an attractive location for foreign direct investment (FDI), including: modern infrastructure with access to main EU transportation corridors, a major port on the Adriatic Sea, a highly-educated and professional work force, close proximity to Central/Southeastern European and EU markets, and membership in the EU and Eurozone. However, potential investors in Slovenia have faced challenges including a lack of transparency in economic and commercial decision-making, unclear tender processes, and at times an inconsistent taxation and regulatory structure. EU member states are the biggest investors in Slovenia. Together they account for over 80 percent of all inward investment in Slovenia. The share of inward FDI stock in GDP in 2013 in Slovenia stood at 25 percent. Nevertheless, foreign companies are an important factor to Slovenia's economy. In 2013, they accounted for 19.2 percent of capital, 22.7 percent of assets and 22.1 percent of employees in the entire corporate sector. Their capital and workforce generated 29.4 percent of total net sales revenue and 28.0 percent of total operating profit. Foreign companies accounted for 39.5 percent of exports and 45.2 percent of imports by the Slovenian corporate sector. Sectors of the economy that are most successful in attracting FDI to Slovenia include manufacturing, especially metal products, electrical and optical equipment (in particular production of components for electronic and automotive industry), chemical products and products from plastic materials, paper, pharmaceuticals, rubber, wholesale, retail, and financial and business consultancy. An annual survey of foreign companies in Slovenia, conducted by the Slovenian Public Agency for the Promotion of Entrepreneurship, Innovation, Development, Investment and Tourism (SPIRIT Slovenia), indicates the most decisive factors for choosing Slovenia as a location for investment are the high quality production of export goods, the high skills and expertise of the labor force, prospects for long-term relationships with local customers and suppliers, market access (mostly for services), and geographic position.

Lebanon is open to foreign direct investment and has many advantages that have encouraged foreign companies to set up offices in the country. These include a free-market economy, the absence of controls on the movement of capital and foreign exchange, a well-developed banking system with strong financial soundness indicators, a highly-educated labor force, good quality of life, and limited restrictions on investors. According to the most recent Transparency International Corruption Perception Index, Lebanon is one of the 50 most corrupt countries in the world, and ranks 14 out of 19 countries in the Middle East North Africa region. Other issues that continue to cause frustration among local and foreign businesses include red tape, arbitrary licensing decisions, outdated legislation, an ineffectual judicial system, high taxes and fees, unreliable interpretation of the law, and weak enforcement of intellectual property rights. The ongoing presidential vacancy since May 2014 and the political divisions behind the delay in electing a new president have hampered the effectiveness of an already divided cabinet, where major decisions have been stalled waiting for elusive political consensus. However, the negative impact of the political stalemate on the economy has been somewhat compensated for by several Central Bank stimulus packages implemented since January 2013 that, combined, injected approximately USD 4 billion into the economy. That stimulus, in addition to increased domestic consumption of goods and services (in part from the presence of an estimated 1.5 million Syrians seeking refuge in Lebanon), helped Lebanon achieve GDP growth of two percent in 2014 (IMF). In 2015, political risk perceptions remain high, given the negative impact on the Lebanese economy of the continuing turmoil in Syria and the region, compounded by uncertainty over the vacant presidency and the country's security, which was tested by extremist attacks in 2014 and 2015. As a result, many investors have maintained a wait-and-see attitude. Although the public deficit dropped by 27 percent in 2014, it remains an issue of concern for investors, but given the high liquidity in the domestic banking sector and continued growth in deposits in private banks, the Government of Lebanon (GoL) should not face difficulties in financing its deficit and rolling over sovereign maturities coming due in 2015. The Central Bank continues to publicly assert that it will maintain monetary and financial stability - reassuring investors that there will be no debt defaults and no currency depreciation. In April 2015, the rating agency Standard & Poor's affirmed Lebanon's "stable" rating. The business climate will remain sensitive to domestic and regional political and security developments. Spillovers from the Syrian crisis will continue to impact growth, which is expected to remain below potential until a positive resolution in Syria. In addition to political divisions, elite satisfaction with the status quo has blocked structural reforms and legislation to stimulate growth, encourage private sector development, and create jobs. The World Bank currently rates Lebanon 104 out of 189 in the ranking category- Ease of Doing Business. While the World Economic Forum's 2015 Global Competitiveness Index, ranked Lebanon 113 out of 144 worldwide. Lebanon is keen to attract U. S. investment because of its state-of-art technology, know-how, and competitiveness. Significant potential opportunities for U. S. companies exist in the energy sector, namely oil and gas exploration and power production. However, the first bid round for offshore oil and gas exploration has been delayed due to political differences and as of May 2015, no new date has been set. By 2020, Lebanon intends to be in a position to rely on renewable energy for at least 12 percent of its energy needs, a good investment opportunity for U. S. companies.

A major money laundering country is defined by statute as one "whose financial institutions engage in currency transactions involving significant amounts of proceeds from international narcotics trafficking". However, the complex nature of money laundering transactions today makes it difficult in many cases to distinguish the proceeds of narcotics trafficking from the proceeds of other serious crime. Moreover, financial institutions engaging in transactions involving significant amounts of proceeds of other serious crime are vulnerable to narcotics-related money laundering. Additionally, money laundering activity has moved beyond banks and traditional financial institutions to other non-financial businesses and professions and alternative money and value transfer systems. This year's list of major money laundering countries recognizes this relationship by including all countries and other jurisdictions whose financial institutions and/or non-financial businesses and professions or other value transfer systems engage in transactions involving significant amounts of proceeds from all serious crime. A government (e.g., the United States or the United Kingdom) can have comprehensive anti-money laundering laws on its books and conduct aggressive anti-money laundering enforcement efforts but still be classified a major money laundering jurisdiction. In some cases, this classification may simply or largely be a function of the size and/or sophistication of the jurisdiction's economy. In such jurisdictions, quick, continuous, and effective anti-money laundering efforts by the government are critical. The following countries/jurisdictions have been identified this year in this category:

Mongolia is a landlocked country located in North-East Asia. Foreign Direct Investment (FDI) into Mongolia has trended downward since its 2011 peak of USD 4.7 billion. Overall, FDI into Mongolia fell by 85 percent from 2011 through the first quarter of 2015, with USD 644 million of FDI in 2014. Some 80 percent of FDI into Mongolia annually targets the mining sector and falling global coal and copper prices have dampened investor interest. Mongolia's elected leaders readily accept, however, that government missteps (confiscating selected mining licenses, levying a mining-specific windfall profits tax, assuming veto rights over mining company business decisions, etc.) collectively amounted to a far greater disincentive to investment; these leaders say they recognize the need to correct course. Parliament's ousting of the Democratic Party-led coalition Government in November 2014 clearly reflected a lack of confidence in the government's economic policies. In December 2014, new Prime Minister Saikhanbileg led an all-party unity government into office vowing to focus its efforts virtually exclusively on Mongolia's battered economy, to make restoration of FDI the center of those efforts, and to put the launching at long last of two FDI-fueled mining mega-projects - OyuTolgoi (copper/gold) and TavanTolgoi (coal) - at the epicenter of efforts. The new PM initially received high grades from the Mongolian public for sincerity and determination but lower grades for results. A sign that the PM and his government mean to turn that situation around was the May 18, 2015, signing of the Oyu Tolgoi Underground Mine Development and Financing Plan (Plan) by representatives of the GOM and Rio Tinto. At the signing, Prime Minister Saikhanbileg said "Mongolia is back to business" and that Oyu Tolgoi is a world-class copper-gold asset and its further development is of great economic significance for Mongolia. He boldly asserted that Mongolia had finalized a way forward with its partners that established a new and constructive relationship based on mutual trust and joint long-term commitment to Mongolia's growth. The PM's robust, public defense of the Plan before Parliament on May 22 encouraged investors' belief that GOM is fundamentally changing its attitude toward FDI. However, investors also will judge the GOM's resolve by how it treats investments beyond OT. As most Mongolian eyes focus on Parliament, international investors have an additional and serious concern - the evident willingness of Mongolian state prosecutors and other authorities to unilaterally impose exit bans on foreign business executives whose companies become involved in business-related disputes with the government or individual Mongolian citizens. The 2015 conviction and imprisonment of three mining executives (among them a U. S. citizen) suggested to investors that Mongolian courts do not fully observe principles of due process, and that foreign investors risk being coerced into settling legal disputes on disadvantageous terms. In 2014, investors told us that those willing to realistically accept the challenges of Mongolia's commodity-driven economy and rough and tumble political and judicial processes might find profitable medium- to long-term investment opportunities. Mongolia, after all, has some of the world's largest untapped mineral reserves. For U. S. investors, mining and mining-related services represent the most important and potentially remunerative sectors for long-term investment in Mongolia. Other promising sectors include infrastructure, transportation, energy, construction, healthcare, agriculture, tourism, and environmental products and services. But investor concerns about weak rule of law in Mongolia require us to heavily caveat even last year's qualified endorsement.

The Republic of Georgia (Georgia) is located at the crossroads of Western Asia and Eastern Europe. Since the Rose Revolution, Georgia has made sweeping economic reforms, moving from a near-failed state in 2003, to a relatively well-functioning market economy in 2015. Through dramatic police and institutional reforms, the government has mostly eradicated low-level corruption. According to a 2015 Georgia Messenger poll, only 2 percent of the population reported that they had to pay a bribe in the previous year to receive a government service or decision. In 2005, the government eliminated 84 percent of licensing requirements, and Georgia ranks 15th in the 2015 World Bank's, Ease of Doing Business Index. Fiscal and monetary policy are focused on low deficits, low inflation, and a floating real exchange rate, although the latter has been affected by regional developments, including sanctions on Russia and other external factors such as a stronger dollar and weaker regional economies. In October 2012 Georgia ushered its first democratic transfer of power when former Prime Minister Bidzina Ivanishvili's Georgian Dream coalition won a parliamentary majority and formed a new government. The 2013 Presidential elections in Georgia were viewed by international observers as highly competitive with fair electoral processes and facilitated Georgia's second peaceful transfer of power in a little over a year. Prime Minister Ivanishvili resigned in November 2013, and was replaced by Irakli Garibashvili. Subsequent local self-government elections in 2014 further consolidated Georgia's record of electoral democracy and were acknowledged by the international community as yet another step towards strengthening democratic processes in Georgia. The current government has carried on the previous government's low-regulation, low-tax, free market policies, while increasing social spending, strengthening anti-trust policy, amending the labor code to strengthen protections for workers, and consulting the private sector in the development of sound economic policies. In early 2014, the government published its medium-term economic strategy Georgia 2020, which outlines Georgia's economic policy priorities. It stresses the government's commitment to business friendly policies such as low taxes, but also pledges to invest in human capital and to strive for inclusive growth across the country, not just in Tbilisi. The strategy also emphasizes Georgia's geographic potential as a trade and logistics hub along the New Silk Road linking Asia and Europe via the Caucasus. Companies in past years reported occasional problems arising from a lack of judicial independence, lack of intellectual property rights enforcement, lack of effective anti-trust policies, selective enforcement of economic laws, and difficulties resolving disputes over property rights. Georgia's government has pledged to address these issues and, despite these remaining challenges, Georgia stands far ahead of its post-Soviet peers as a good place to do business. In June 2014, Georgia signed an Association Agreement (AA) and Deep and Comprehensive Free Trade Area (DCFTA) with the European Union. In 2012, following President Obama's meeting with former Georgian President Mikheil Saakashvili, the U. S. and Georgia established a High-Level Dialogue on Trade and Investment to identify ways of increasing bilateral trade and investment. The U. S. and Georgia also discussed economic cooperation within the bilateral Strategic Partnership Commission's Economic Working Group. Both countries signed a Bilateral Investment Treaty in 1994, and Georgia is eligible to export many products duty-free to the U. S. under the Generalized System of Preferences (GSP) program. The program is currently awaiting re-authorization by Congress.

The Czech Republic is a medium-sized, open, export-driven economy. Around 80 percent of its GDP is comprised of exports - mostly from the automotive and engineering industries. Its strong dependence on foreign demand, especially from the Eurozone, of which it is not a member, was highlighted in the global financial crisis of the late 2000s. However, the Czech banking sector remained relatively healthy. After two years of economic contraction, the Czech economy emerged from recession in early 2013 and enjoyed two percent GDP growth in 2014. Experts predict approximately 2.5 percent growth in 2015. In November 2012, the Czech National Bank (CNB) lowered the two-week repurchase rate to a record low of 0.05 percent, referred to as technical zero, in order to address deflationary pressures. A year later, the CNB launched a foreign exchange intervention to mitigate the risk of continued deflation. Since then, the exchange rate has remained at 27 Czech crowns/1 euro or weaker (27.5 as of April 2015). Accordingly, due to the fall of the euro in 2014, the Czech crown has weakened to 25/1 USD (as of April 2015). The Czech crown is fully convertible and all international transfers of investment-related profits and royalties can be carried out freely without delay. While there has not been significant political momentum toward Euro accession in recent years, the current government under Prime Minister Sobotka has demonstrated a more positive approach to EU integration than any past government. CSSD, Sobotoka's party and the coalition leader, expressed support in March 2015 for joining the Eurozone by 2020. President Zeman is also a strong supporter of Euro accession. The Czech Republic fully complies with EU law and OECD standards for the equal treatment of foreign and domestic investors. Labor laws are comparable with most developed nations, but a gap still exists between wages of Czech individuals and their neighbors in Western Europe. The U. S.-Czech Bilateral Investment Treaty provides for international arbitration of investor-State disputes. Great strides have been taken since the fall of communism to open the market to competition and privatization, but the prosecution of anti-trust violations is still less than adequate. Corruption remains a problem. Czech Intellectual Property Rights (IPR) protections are still not optimal, but the legal framework for IPR protection has been tested and proven successful in punishing infringers. Other western concepts such as entrepreneurship and corporate social responsibility (CSR) are growing trends in the Czech business and NGO communities. There are no general restrictions on foreign investment, although limits exist within certain sectors. The Czech Republic attracts a great deal of FDI for its size, and has taken strides to diversify its traditional investments in engineering into new fields of research, development and innovative technology. In fact, EU structural funding has enabled the country to open a number of world-class scientific and hi-tech centers. Companies from EU member states are the chief foreign investors in the Czech economy, but the government has signaled a desire to seek more export and investment opportunities from non-European regions, including the United States, China, and South Korea.

Armenia is located in Western Asia. The Government of Armenia (GOA) officially welcomes foreign investment and the country has received respectable rankings on some global indices measuring business climate. In January 2015 the Eurasian Economic Union trading bloc went into effect, creating a single economic market of 176 million people between Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia. Armenia has a highly educated workforce and the high-tech and information technology (IT) sectors have attracted foreign investments - particularly from the United States. 2014 saw the initial steps towards a major U. S. investment in Armenia's energy generation sector that is expected to finalize in 2015. However, Armenia's investment climate can be difficult and poses several serious challenges: a population of less than three million; relative geographic isolation due to closed borders with Turkey and Azerbaijan; per capita gross national income (GNI) of about USD 3,800; and high levels of corruption in both official and commercial spheres. Armenia has no limitations on the conversion and transfer of money or the repatriation of capital and earnings, including branch profits, dividends, interest, royalties, or management or technical service fees. The banking system in Armenia is sound and well-regulated, but Armenia's financial sector is not highly developed. Foreign individuals who do not hold special residence permits cannot own land, but may lease it; companies registered by foreigners in Armenia as Armenian businesses have the right to buy and own land. There are no restrictions on the rights of foreign nationals to acquire, establish or dispose of business interests in Armenia. The U. S.-Armenia Bilateral Investment Treaty (BIT) provides that if a dispute arises between an American investor and the Republic of Armenia, the investor may choose to seek remedy through binding international arbitration. Although Armenian legislation complies with the Trade Related Aspects of Intellectual Properties (TRIPS) Agreement and offers protection of intellectual property rights (IPR), enforcement efforts need to be improved. The Armenian regulatory system lacks transparency. Major sectors of Armenia's economy are controlled by well-connected businessmen who enjoy government-protected market dominance. Corruption remains a significant obstacle: although the government has introduced a number of reforms over the last few years, and the overall investment climate seems to be improving incrementally, corruption remains a problem in critical areas such as the judiciary, tax and customs operations, health, education, and law enforcement. Tax and customs procedures, while having improved, still lack transparency. It is still not uncommon to see the use of the two-invoice system, where reference prices are used, instead of invoice prices during customs clearance and manipulation of the classification of goods increases costs. The court system lacks independence, making it an unreliable forum for resolution of disputes.