CIP ST LUCIA
A SECURE INVESTMENT
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INTERVIEW: CITIZENSHIP BY INVESTMENT SAINT LUCIA
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PROSPERITY Sustainable Business Magazine speaks to Nestor Alfred, CEO at Citizenship By Investment Saint Lucia, about good governance, CIP’s role as a source of revenue for Saint Lucia, and its benefits for local communities. Compared to its neighbors, Saint Lucia is new to the idea of a citizenship by investment program (CIP). The program, which allows eligible individuals to apply for national citizenship, has been in place in neighboring Saint Kitts for over 36 years, for 27 years in Dominica, and roughly 15 each for Grenada and Antigua. In 2020, Saint Lucia CIP celebrated its fifth year, but despite its infancy, the idea behind the program remains the same: an opportunity for the country to generate economic growth and stability. “In pursuing CIP, Saint Lucia was very cautious,” says Nestor Alfred, CEO at Saint Lucia CIP. “We took the time to understand how the program was being managed in other islands; what were some of the pitfalls and the strengths. It was on this basis that in 2015, Saint Lucia drafted a piece of legislation with regulation to drive such a program.” 2 | SUSTAINABLE BUSINESS MAGAZINE
PRESERVING INTEGRITY At the center of Saint Lucia’s CIP is a commitment to rigorous due diligence. “There’s some common traits amongst the islands that operate CIP programs,” says Mr. Alfred. “All these countries have beautiful sunshine, blue seas, and white sand. But here in Saint Lucia, we spare absolutely no effort regarding the conduct of due diligence. From the outset, the island decided that the grant of citizenship ought not to be in the hands of
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INTERVIEW: CITIZENSHIP BY INVESTMENT SAINT LUCIA
“SINCE THE PANDEMIC BEGAN, THE CIP HAS RECORDED ITS BEST PERFORMANCE IN FIVE YEARS, WITH AN INCREASE IN REVENUE IN EXCESS OF 100%.”
politicians, but in the hands of competent technocrats and so legislation provided for the setting up of a board of directors, who are charged with the final decision over whether any individual citizenship is granted or denied. Likewise, Saint Lucia’s legislation mandates that Saint Lucia’s CIP Unit undertakes a financial audit of its affairs by a professional audit firm and presents to the Cabinet of Ministers, for onward transmission to Parliament, its audited financial statements. When this statement is presented to Parliament, it becomes a public document, which means that all Saint Lucians can lay their hands on this document to see the amount of revenue that the program has generated, as well as how many applications have been approved and declined as well as the financial standing of the Unit.” 4 | SUSTAINABLE BUSINESS MAGAZINE
Despite its small size, Saint Lucia has worked hard to prioritize transparency and good governance within its programme. “Since the collapse of Cyprus’s golden visa program, there have been questions as to whether small states have the capacity to undertake the requisite due diligence, to protect their own borders, and those of Europe and the United States,” says Mr. Alfred.
“However, we have clearly demonstrated that we the capacity and willingness to do just that. We work closely with CARICOM IMPACS and through its “sister” organization, Joint Regional Communication Centre based in Barbados, together with our own Law Enforcement, to ensure that before we grant citizenship, intelligence information is obtained on every single applicant. It is es-
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www.tmantoinelaw.com sential that we know whether any applicant is wanted by any other country; whether they’re on Interpol red lists; or whether they’re involved in criminal or terrorist activities. To advance the due diligence process further, we have contracted international due diligence firms. These firms have the responsibility to create a profile of our applicants, to confirm that they exist, they have friends, a home, a workplace. Without deliberate due process, we know that we cannot make an informed decision on the grant/decline of citizenship to any applicant.” RELIABLE REVENUE The mainstay of Saint Lucia’s economy is tourism, contributing over 60% of GDP. However, with the onset of the COVID-19 pandemic the island has seen tourist reve-
nues take a significant hit, with international lockdowns discouraging or preventing tourists from travelling to Saint Lucia from its main markets. “During the pandemic, the significance of CIP was really brought to the fore,” says Mr. Alfred. “We’ve all seen how fragile the tourism sector can be, and it’s partly because of this and the opportunity to develop another sector that the government of Saint Lucia first decided to pursue CIP as a viable platform. Now, what we have seen in the last year is that CIP has become practically the only sector that has been able to generate revenue irrespective of the pandemic and irrespective of lockdowns. In fact, since the pandemic began, the CIP has recorded its best performance in five years, with an increase in revenue in excess of 100%.”
The CIP Unit is fully aware of some of the underlying factors behind this increase in demand for its services. “It’s notable that, during this pandemic, we’ve seen an increase in applications for citizenship from countries that lie outside of our traditional areas,” says Mr. Alfred. “In any CIP program, people primarily seek international mobility, and that mobility is usually sought by people whose passports are not “strong” enough to give them visa-free access to many countries. In Saint Lucia, we are fortunate to have visa-free status with 146 countries in the world, and it’s a major pull-factor. But what the recent change in our applicant base suggests is that people are looking for a security platform. As we’ve seen in the United States, there’s been a continued increase in COVID case numbers. Many people believe that in the Caribbean, the pandemic has been controlled in a more reasonable way. Because of that, more people are seeking a move, and wanting to take advantage of the opportunity that comes with a Saint Lucian passport.” SUPPORTING THE NATION Although the CIP’s remit is simply to process citizenship applications, all funds received go towards the country’s National EcoSUSTAINABLE BUSINESS MAGAZINE
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INTERVIEW: CITIZENSHIP BY INVESTMENT SAINT LUCIA
“THE CIP WAS ORIGINALLY SET UP TO GENERATE MUCH-NEEDED REVENUE FOR THIS ISLAND, AND TO PLAY AN IMPORTANT ROLE IN ITS ECONOMIC DEVELOPMENT”
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nomic Fund that has been set up. “With a significant percentage increase in numbers, comes a significant increase in dollar value,” says Mr. Alfred. “This in and of itself sets a really good tone for the country, in terms of having a reliable source of revenue at such a crucial time and in helping the government meet its primary objectives. The National Economic Fund itself has its own board of directors, manned by the technocrats within the Ministry of Finance and two representatives from the private sector. The spenging of this Fund is captured within the respective legislation, and prioritizes infrastructure investments, reduction of national debt, and other social purposes. Prior to the establishment of the National Economic Fund CIP some of the funds were directed in areas such as the agricultural diversification program, and the completion of the St. Jude Hospital, located in the south of the island.” As the country looks to the future, the main question is not about whether CIP can replace tourism, but about how it can work alongside tourism to shape and bring prosperity to Saint Lucia. “CIP was originally set up to generate much-needed revenue for this island, and to play an important role in its economic development,” says Mr. Alfred. “We’re proud to able to say that we’re already doing that. In the government’s 2019 budget preparation, CIP was cited as instrumental in reducing government deficit, a fact that speaks volumes about the capacity of this program. In the future, we would like CIP to have an even greater impact on the country’s development. With our focus on corporate governance, we hope that the spend of CIP money will be far more transparent. We need to continue in all of our endeavors to protect the integrity of our passport.” c SUSTAINABLE BUSINESS MAGAZINE
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CIP ST LUCIA
PASSPORT TO PROSPERITY