St. Lucia CIU “Not Against Signing MoA”, 50-60% of Saint Kitts Govt Revenue From CBI

An internal review of the Citizenship by Investment (CBI) Program in St. Kitts and Nevis has uncovered an alarming over-reliance on the program’s revenue by the former administration, indicated Prime Minister and Minister of National Security and Immigration, Dr. Terrance Drew, in a statement delivered to the National Assembly last week.

According to Dr. Drew, the CBI program generated 50% of the federal government’s overall cash revenue in the last five years of the previous administration, reaching an unsustainable 60% in 2022. The previous administration’s term concluded in August 2022.

PM Drew also said that during the past two years, mostly under his leadership, 57% of his government’s overall cash revenue arose directly from the CBI program.

“This is the truest economic example of putting all of one’s eggs in one basket,” Dr. Drew commented, according to The St Kitts & Nevis Observer.

Intending to address this over-dependence proactively, the current administration says it has prioritized expanding and diversifying the national economy, focusing on sectors such as tourism, construction, water and energy infrastructure, the creative economy, agriculture, offshore education, and manufacturing.

St Lucia Fails to Meet CBI Revenue Target

While St Kitts is concerned it may be overly dependent on its CBI revenue, Saint Lucia sees things differently. In a Parliamentary address last week, Prime Minister Philip J. Pierre said that St Lucia’s CBI program contributed US$45 million in the fiscal year 2023/2024 – half the estimated US$90 million. Saint Lucia’s latest annual statistical report available online covers only the period up to the 2021/2022 fiscal year.

Pierre attributed the lower revenue to the rising popularity of the real estate route as opposed to the donation route, which has typically been more attractive to investors. This could be attributed to St Lucia recently lowering the real estate threshold to US$200,000 from the previous US$300,000.

Saint Lucia’s CIU currently only has one listed real estate option, a project from Caribbean Galaxy. This project, however, has reportedly sold out already, and local agents tell IMI the government recently approved the issuance of several thousand more shares for another project from the same developer, this time in the infrastructure category, specifically an infrastructure project. IMI has so far not been able to verify this with official sources.

Despite the underwhelming performance, the National Economic Fund received $64.1 million in CBI revenue, US$45 million of which accrued directly to government coffers, while the balance will now be available for use according to the Fund’s objectives. Additionally, US$39.5 million took the form of bond investment, but these funds are included in bond financing this year. The government also allocated US$17.4 million from the CBI revenue to fund security, healthcare, social development, and infrastructure development.

Saint Lucia Wants More Time to Consider Pan-Caribbean CBI Price Accord

Responding to a question IMI posed last week regarding Saint Lucia’s decision to opt out of the Memorandum of Agreement signed by the other four Caribbean CIPs, Saint Lucia CIU boss Mc Claude Emmanuel said “an official response will soon be provided” and emphasized that “Saint Lucia is not against signing the MoA.”

Emmanuel reveals Saint Lucia had “asked for additional time to address some housekeeping matters and discuss legal obligations. However, the other territories went ahead and signed.”

He also remarked that Saint Lucia’s CIU stood “in solidarity with our regional CIPs in the effort to maintain the viability of the industry, and Saint Lucia continues to be lauded for having the most robust due diligence process.”