The Changing IM Industry And The Rise Of The Caribbean Republics
Cinvest Migration
IMI Official Partner
This year has taken a heavy toll on investment migration.
Portugal dominated the media with the catastrophic handling of its Golden Visa saga, Greece doubled its golden visa asking price for real estate, and Australia all but doomed its BIIP visas by deprioritizing them. The UK showed, once again, it has no idea what it is doing with its Innovator Visa and, most recently, Dominica lost visa-free access to the UK.
How a year that started with such positive updates in the Caribbean can lead to where we are now is truly baffling, and it seems as if a new era of investment migration is upon us.
EU programs on their last legs
The EU seems bent on demolishing everything investment migration-related, which has been the case for some time. But what is more surprising is that sovereign EU states with investment migration programs, except Malta, don’t seem determined to defend them.
The damage to Portugal’s and Greece’s Golden Visas was self-inflicted. It was not an EU mandate nor a result of pressure emanating from Brussels; it was all done in-house.
Now, many will try to spin the “survival” of the Portuguese Golden Visa as a positive. But taking away the real estate option, which accounted for more than 95% of all applications since the visa opened, is devastating. Yes, the funds have gained popularity during the COVID period, but even that interest may die down as investors must choose funds that don’t focus on real estate investments, adding risk to an already risky – and expensive – investment option.
Greece may have done better, limiting the damage to certain areas, but in a program where investment options suffer from inflated prices with massive markups, investors will soon realize they are getting less value for more money.
Both programs were outstanding investment migration options, but the blind tinkering of their governments has seriously hindered them, and they’ve made them much more expendable when the EU inevitably comes knocking on their door.
The EU Commission’s stance is clear, and taking Malta to court is a testament to that. The future of EU Golden Visas is now up in the air, and it doesn’t look good.
The Caribbean way forward
Caribbean states haven’t been any luckier dealing with geopolitical superpowers meddling in their affairs. But there is still a glimmer of hope.
After an encouraging start to the year with St Kitts & Nevis and St Lucia announcing major updates to their programs, a more political tone took over.
A roundtable meeting with top US officials resulted in six principles Caribbean Citizenship by Investment Programs (CIPs) must follow, many of which are now in place. But this meeting highlighted the sheer influence the US has over Caribbean states, even though they have no visa-free travel to the country. The Caribbean’s economic reliance on the US through tourism and trade means the Americans have a lot of sway over Caribbean politics.
Then, the UK’s Security Minister Tom Tugendhat announced that the government is “reviewing” Caribbean CIPs, a matter that culminated in the worst possible way for Dominica when the country recently lost its visa-free access to the UK.
UK Home Secretary Suella Braverman cited “clear and evident abuse of the [CIP] scheme” and “the granting of citizenship to individuals known to pose a risk to the UK” as the reasons behind the decision.
While this was going on, Caribbean top officials were dealing with another major superpower as they attended the EU – CELAC Summit in Brussels, which resulted in the EU agreeing to create a committee with OECS to “discuss and structure” the region’s CIPs, as well as (allegedly) six demands the CIPs should follow (four of which were already in place thanks to the US). This appears to have resulted in St Kitts & Nevis doubling its investment amounts in accordance with those demands, and the other Caribbean CIPs are expected to follow to maintain a good relationship with the EU.
The Caribbean Five are small countries with developing economies. They created their CIPs to aid their economic growth, but they now find themselves stuck within a triangulation of the world’s three leading political superpowers, and although it is a sticky situation, they have performed admirably, not relenting to the mounting pressure and they may even decide that this is the time to forge their own path forward.
The Rise Of Caribbean Republics
Caribbean Republicanism is on the rise, now more than ever since King Charles III has taken the throne.
Queen Elizabeth II’s passing has instigated an interest in republicanism within the Caribbean, as Matthew Smith, director of the Centre for the Study of the Legacies of British Slavery at University College London, highlighted that now with King Charles, “it’s a very different relationship.”
Six Caribbean countries are now considering becoming republics. Out of those, Grenada, Antigua & Barbuda, and St. Kitts & Nevis offer CIPs.
Caribbean countries are quickly realizing that being part of the Commonwealth realm isn’t as useful as onlookers may assume. Jahlani Niaah, a lecturer at the Institute of Caribbean Studies at The University of the West Indies, clarified the stance explaining that “we’re [Caribbean countries] relying on those arrangements to bring us serious socio-political transformation, but they have just made us more financially imbalanced.”
CIPs have been one answer to this imbalance, but now the UK, whose monarch is still officially the head of state in Antigua & Barbuda, Grenada, St Kitts & Nevis, and St Lucia, has been actively aggressive toward that economic lifeline.
Dominica is the only one of the Caribbean Five to become a republic, doing so in 1978. Some have speculated that this played a role in removing it from the visa-free waiver list so quickly after the UK announced its review.
But even if that is the case, Antigua & Barbuda, Grenada, and St Kitts & Nevis are still considering doing so because becoming a republic is much more than just visa-free access, and their CIPs will survive a minor setback.
The Caribbean’s willingness to talk to the US and the EU openly about their programs highlights their ability to engage in diplomatic discourse at the highest level and maintain their sovereignty, a matter which republicanism can boost.
By forging their own path forward, Caribbean CIPs can mold into something that fits the needs of the country while also maintaining a good relationship with the major global players that actually want to talk rather than threaten.
The US-Caribbean roundtable was a perfect example of this issue. Caribbean states have come to recognize that the US’ economic importance is much greater than the political one in Europe, and they managed to find a middle ground that suited all parties involved.
The Future Is Bright For Caribbean CIPs
Even if the Caribbean Five lose visa-free access to the UK – even if the worst materializes and they lose access to the Schengen Zone – they’ll survive.
This comes down to two main reasons; First, Caribbean citizenship is much more than just visa-free travel, even though most RCBI firms market it as such.
From immigration springboarding, wealth management, financial freedom, contingency planning, tax restructuring, and more, Caribbean citizenship is a major venture with endless benefits that can elevate anyone’s quality of life.
The second reason is that it has no competition. As EU Golden Visas are being run into the ground, Caribbean CIPs are the dominant investment migration programs in the world.
Their price point is optimal, the process is swift and smooth, and the benefits are there. Golden Visas are pricier and get more difficult as time goes on, and they seem to be living on borrowed time, while Turkey’s CIP is much more expensive (for now), and Vanuatu has had enough internal and external problems to render its CIP inferior to those in the Caribbean.
Demand for CIPs won’t go away. The EU and UK do not seem to take into consideration how dire the need for second citizenship is in countries in certain regions of the East. And those investors seeking quick, simple, and authentic naturalization won’t care about visa-free access alone, as it is just one part of what makes citizenship by investment so important to them.
The future of Caribbean CIPs is safe. The only ones who can alter that are the Caribbean governments themselves, and if they do pursue becoming republics, they’ll have more control over their own fates.