The European Union (EU), Canada, and the U.S. have been pushing Caribbean governments to improve due diligence systems for foreigners buying into a scheme to obtain passports and local citizenship, worried that too many dubious characters had escaped detection.
The western nations had threatened to take away visa free-entry rights of citizens from Dominica, St. Kitts, Antigua, St. Lucia, and Grenada if the investigatory abilities of their Citizenship by Investment Program (CIP) were not stepped up.
Under the CIP scheme, people from around the globe with as little as $100,000 could have applied to obtain a passport from any of the five participating nations and citizenship once they had pumped cash into real estate, education funds, and investment ventures, among other areas. These golden passports allow the newly minted citizens to enter Canada, Europe, and more than 100 countries around the world as local citizens who do not require visas. That is the main fear of EU and Canadian security officials.
In recent months, the EU in particular has increased pressure on the CIP nations in the Eastern Caribbean to increase their base rates to make it more expensive for people from around the world to apply. In most cases, the five leaders of the CIP nations agreed to do so in the past month and have almost doubled rates for applicants in keeping with EU and Canadian urgings.
The regional sub-grouping had turned to the scheme to replace revenues lost from the Caribbean’s largely duty-free single trading market, other bilateral agreements, and the collapse of the banana and sugar exporting markets to Europe in the past two decades. Agents worldwide who procure applicants for CIP nations have already been informed of the new changes, governments said.
Aligning with other participating nations as of the end of July, the new baseline minimum fee would be doubled to $200,000. For a family of four applying, the minimum investment will be $230,000; for five or more, $245,000. Those who wish to invest in real estate ventures will be required to fork out $325,000, but there has been no increase in business venture investments—this remains at $1.5 million. Rates are now similar for most of the five nations.
“These changes are meant to align with (EU) demands to raise the minimum investment threshold,” according to the announcement. “The EU has been pressuring Caribbean states to eliminate or alter their citizenship program[s]. The four islands also committed to sharing data between CIPs and enhancing programme transparency. They will share information on applicants with each other by establishing a digital portal with the joint regional communications centre (JRCC) in Barbados.”
Although pressured by the western nations to consider abandoning CIP programs altogether, Caribbean governments are adamant that revenues from the scheme have funded major development projects, including propping up a tenuous pension program in one country, investing nearly $1 million in the Antigua-based LIAT commuter air service, and keeping some economies afloat during the COVID-19 pandemic.
Neighboring Dominica used a chunk of its revenue stash to help recover from Hurricane Maria in 2017. Other countries have built sports arenas from such revenues, but concerns remain about the ability of the participating nations to investigate the backgrounds of applicants properly from far-flung places like Russia, Belarus, and China, among others.
