Caribbean countries selling citizenship at discounts to curb effect of COVID-19 on economies

Francis Akhalbey Jul 22, 2020 at 10:00am

July 22, 2020 at 10:00 am | Money Moves

Francis Akhalbey

Francis Akhalbey | Staff Writer

July 22, 2020 at 10:00 am | Money Moves

Some Caribbean countries are offering citizenship at discounts -- Photo Credit: stkittstourism.kn

Besides tourism, Citizenship by Investment is one of the major revenue generators in some Caribbean countries. Rich and affluent people in the United States, Asia, Europe as well as other developing countries, usually opt for second passports from Caribbean nations that offer this “expensive luxury” due to their mobility in visa-free travel to several countries and tax planning.

According to IMF in a 2016 report: “Offering citizenship in return for investment has been a “win-win” for some small Caribbean states. The substantial inflows of funds from these programs have helped boost employment and growth. Inflows to the public sector alone in St. Kitts and Nevis had grown to nearly 25 percent of GDP as of 2013.”

The dual-island nation of Saint Kitts and Nevis is one of the pioneers of the Citizenship by Investment program, launching theirs as far back as 1984 to help develop the country. The program, which has since, over the years been implemented by other countries as means to cushion their various economies, has metamorphosed into a multi-billion dollar business.

With tourism being one of the major sources of revenue in the Caribbean, attracting millions of visitors and raking in billions of dollars annually, the COVID-19 pandemic has severely impacted the economies of these countries. As a means of mitigating the effects, some Caribbean nations are enticing foreigners with Citizenship by Investment offers at reduced costs, Bloomberg reports.

Saint Kitts and Nevis, which was one of the first to offer discounts, has a passport package for a family of four in exchange for a $150,000 contribution to the dual-island nation’s “Sustainable Growth Fund.” This is less than the previous $195,000 asking price. The aforementioned offer will be available till the end of the year.

“In these days of Covid, when tourism is not happening, we have to find ways to create revenue to sustain our economy,” Les Khan, CEO of St. Kitts and Nevis Citizenship Investment Unit, told Bloomberg.

He added that other Caribbean nations, including Saint Lucia, Grenada, Antigua and Barbuda, and Dominica have also discounted their regular prices to entice investors, offering citizenship for as low as $100,000.

Saint Lucia also has an option where interested clients can buy five-year, zero-interest “Covid-19 Relief” bonds at a reduced price of $250,000 per person or $300,000 for a family of four. The offer, which is half the regular price, is also available till the end of the year. The island nation has so far awarded citizenship to about 700 clients since the program was introduced in 2015, Nestor Alfred, the CEO of the St. Lucia Citizenship by Investment Program, told Bloomberg.

Passports from Caribbean countries including Antigua and Barbuda, Saint Kitts and Nevis and Saint Lucia – which make the list of global citizenship and residence advisory firm, Henley & Partners’ prime citizenship programs – offer the luxury of visa-free or visa-on-arrival access to over 140 destinations.

“Clients look at these citizenship options as volatility management or risk management tools,” Paddy Blewer, director of the U.K. office of Henley & Partners told Bloomberg, adding that travel restrictions among countries as a result of the COVID-19 pandemic has cast a light on the value of second passports, as citizens of countries – including the United States – who can usually travel without visas have been blocked by some countries.

Prices are, however, likely to go back to normal in the foreseeable future as these initiatives have been introduced to help mitigate the effects the COVID-19 pandemic has had on the economies of these Caribbean countries, Bloomberg reports.

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