The Eastern Caribbean nation of Saint Lucia has emerged as a new favourite for investors. This is due to its growing economy, stable business environment and tax regime which supports the growth and development of its businesses, investors and citizens.
As the world has faced various uncertainties in last two years and investors, High Net-Worth Individuals started finding alternative options to keep their investments safe and secure. To overcome the effects of the Covid-19 pandemic, reviving the economy has proved a major challenge for many countries. The world's largest economies have been affected, with many suffering from declining growth. In response, many investors have been hesitant to invest, seeking out economies that can provide sufficient returns at minimal risk.
In this context, the Eastern Caribbean nation of Saint Lucia has emerged as a new favourite for investors. This is due to its growing economy, stable business environment and tax regime which supports the growth and development of its businesses, investors and citizens.
Launched in 2016, the Citizenship by Investment Programme (CIP) of Saint Lucia is one of the top performers in the Caribbean region. As the demand for the programme such as this skyrockets amongst high net-worth individuals (HNWIs), the newly elected government is striving to utilise the funds brought in by the programme to develop more advanced public infrastructure and uplift the standard of living of its people.
Despite being the newest Caribbean programme in this industry, Saint Lucia offers an advanced, secure and transparent programme. With more foreign direct investments coming into the country via its prestigious CIP Programme, the government is preparing a roadmap to engage in constructing and uplifting schools, roads, health care, and other public infrastructures through the funds generated by the Citizenship by Investment Programme.
The actions and fiscal policies adopted by the government have steered the country out of previous difficulties, promoting the development of an attractive economic environment. In recent years, the country has maintained a steady pace of recovery and has emerged as one of the top choices for the HNWIs.
According to the Economic Commission for Latin America and the Caribbean, Saint Lucia had its highest GDP growth in 2022. This growth is likely to continue in the coming years, due to its thriving tourism industry.
This year, in particular, will be a breakthrough one for the Caribbean island, with statistics reflecting an estimated 13.1% growth in the first six months of 2023. This success is thanks to the country's policy of welcoming direct foreign investment and channelling these funds into the most productive sectors of the economy. This means that investment benefits both the investors and citizens of the country, with Saint Lucia ranking 93 out of 190 countries in the World Bank’s ease of doing business index for 2022.
Once an agriculture-based economy, with the banana industry employing the majority of its citizens, Saint Lucia has now altered course and also focuses on tourism and banking services. By taking this course of action the island nation has changed its fortune, breaking free of its dependence on agriculture, the country has reformed its economic structure. With its tourism industry now constituting 65% of its GDP, it has also become a preferred destination for foreign investors. The industrial setup in Saint Lucia is far easier to navigate than many other countries.
The Government does not limit the amount of foreign ownership or control in the establishment of a business in Saint Lucia, allowing 100 percent foreign ownership of companies in any sector. Currently, there are no restrictions on foreign investors investing in military or security-related businesses or natural resources. Trade licenses and other approvals/licenses may be required prior establishment.
The island has long been considered a top honeymoon destination, but tourism has grown substantially in recent years, with the country attracting approximately 900,000 tourists per year. Investors have therefore generally looked towards the accommodation and hospitality industry. Developing tourist sites and catering to the needs of its large number of visitors, investors have discovered major opportunities for gaining prominent returns on minimal risk investments.
The country will welcome a 345-room Grand Hyatt luxury Hotel in Sabwisha in 2023. The economic boost offered by such large-scale projects is substantial. At least 2,000 Saint Lucians are expected to gain employment through the hotel’s operations and management.
But Saint Lucia isn’t only a hub for tourism. The country is abundant in natural resources, with great scope for developing these in sustainable and eco-friendly ways. In 2021, the World Bank approved a $21.9 million (USD) loan for developing the renewable energy sector in Saint Lucia.
With the loan, the country aims to increase its geothermal and hydroelectric capacity. These plans respond to the call for governments worldwide to transition to and establish socially and environmentally responsible business environments. Additionally, the scheme will reduce the cost of energy on the island, lowering financial stress on businesses. Drawing on renewable energy sources, the country will also be able to facilitate and improve support for energy-intensive industries.
In a move to boost manufacturing and exports, Saint Lucia has also introduced tax holidays for manufacturing units. This is one way in which the government aims to widen its manufacturing base and increase its exports while also encouraging the use of local materials and labour. Approved manufacturing enterprises are entitled to a tax holiday for up to 15 years, depending on the local value provided by approved products.
Businesses also receive income tax incentives as well as other fiscal concessions. These are regulated through the Fiscal Incentives Act, Tourism Incentives Act, Special Development Areas Act and varied concessions granted by the Cabinet of Ministers. Alongside these incentives, the government also allows for the duty-free import of raw materials, machinery, components and equipment. It also offers income tax waivers for up to 100% of companies engaged in manufacturing, tourism and agriculture.
In addition to the above, Saint Lucia hosts a dynamic and steady workforce, from varied professionals to highly-skilled tradesmen and labourers. This budding workforce is available to plan, organise, execute and control business undertakings, supporting new businesses on the island.
In these ways Saint Lucia offers a highly conducive business environment which has been drawing investors from all over the world. Many High Net Worth Individuals (H NWIs) have shown a keen interest in becoming citizens of Saint Lucia, an opportunity provided for by the country’s prestigious Citizenship by Investment Programme (CIP).
SAINT LUCIA: CITIZENSHIP BY INVESTMENT PROGRAMME (CIP)
Saint Lucia is the latest Caribbean country to open its borders to Citizenship by Investment. Although the programme was launched just six years ago, it is already considered one of the top three countries for Citizenship by Investment, according to the CBI Index of 2022. The CIP of Saint Lucia provides numerous benefits such as:
1: Providing investors with global citizenship
2: Delivering opportunities for diversifying investors’ portfolios
3: Planning wealth and business expansion overseas
4: Gaining a citizenship that can be passed down to future generations.
Saint Lucia’s Citizenship by Investment programme is also notable for the ease of its application process. This includes five steps:
Step 1: Completion of the application by applicants.
Step 2: Submission of the application via the CIP Portal.
Step 3: Document verification by the CIP Unit and stringent due-diligence checks.
Step 4: The selection or rejection of the application by the board.
Step 5: The provision of certification, subject to selection.
The Saint Lucia Citizenship by Investment Programme is a member of the Investment Migration Council (IMC). The IMC is the worldwide association for investor immigration and Citizenship by Investment, bringing together the leading stakeholders in the field and giving the industry a voice. The IMC sets the standards on a global level and interacts with other professional associations, governments and international organisations in relation to investment migration. The IMC helps to improve public understanding of the issues faced by clients and governments in this area and promotes education and high professional standards among its members.