My Borders are Your Borders

INTERVIEW: ALLEN CHASTANET, PRIME MINISTER OF SAINT LUCIA

Allen Chastanet, Prime Minister of Saint Lucia, says he supports the idea of common standards for the CBI industry, but he is against the idea of setting a base price that no country would go below.

What is the history and background to Saint Lucia’s CBI programme and how important is it to the economy?

We were a relatively later-comer to the CBI industry, having only launched our programme in 2016. We saw the programme as a way to attract foreign investment and raise funds for large-scale development projects. Since its launch, we have attracted four major hotel developments with a combined investment value of over US$ 1 billion. We have a very diversified economy, with tourism accounting for the lion’s share, along with strong agricultural and manufacturing industries. We are currently developing a financial services sector, which we’d like to expand in the coming years. While the CBI programme is an excellent opportunity to attract additional investment, I’d like to stress that we are not completely dependent on it.

How would you characterise the overall landscape of the sector?

We are seeing more and more countries launching residence-by-investment or citizenship-by-investment programmes, and we believe this is very positive. While it creates more competition, it also creates more credibility for the industry. The industry overall becomes much stronger.

The industry has come under the spotlight of international organisations and the media who question the concept of citizenship by investment. How should the industry reply to this criticism?

I don’t think we can ignore it. We need to communicate better what we do to ensure that our programmes are not an entry point for criminals. We have to be transparent as much as possible, but we should also make it very clear that any system can fail. We are screening all applicants, and we are doing our outmost to minimise the level of risk. We continuously update our systems when new laws and regulations come in. We want to adhere to the best global standards.

What are the priority issues that are currently high on your agenda?

Correspondent banking is very high on our agenda as some banks are not processing CBI funds, which is something I cannot accept. We are doing all the checks that are required, including proper due diligence, and should not be discriminated against.

I can understand that the US and the EU are extremely concerned about the security of their borders. When I talk to them, I get the message that they are not against this industry, they are just trying to protect themselves. I, as Prime Minister, assure our partners that my borders are their borders. But what becomes frustrating is that once we satisfy their demands, they don’t change their policies. We need to find a solution to move forward together.

What are your thoughts on having a public register of individuals who have gained citizenship by investment?

Saint Lucia is not trying to hide anybody. While we do not share information with the general public on who has become a citizen, we do share this information with security agencies around the world. Personally, I would like to see more formalised due diligence cooperation between countries, but many oppose this idea as they feel it might imply an acceptance and responsibility for the due diligence being carried out on their part. They are willing to participate informally, but once it becomes formal, they are not willing to do that.

A number of CBI programmes have taken the step of revoking investors’ citizenships. What are your thoughts on this development and what impact is it having on the industry?

Unfortunately, we had to face that situation in Saint Lucia: citizenship was granted and then we received information from third parties that called into question the integrity of a number of individuals. We have learned from that experience and have streamlined our processes so that this does not happen again. However, our law includes the option of revoking citizenship as the ultimate safeguard.

What would you highlight as the top three challenges that you as Prime Minister are facing in this industry?

Firstly, it is a challenge to continuously convince our international partners that we are running a very good operation. Secondly, the investment migration industry is very dynamic and changing every day; so we need to make sure that what we are offering is competitive. Thirdly, we need to ensure that the funds that are being raised through this programme are directed towards the development of the country. We are inviting new citizens to join our society for the benefit of all citizens. These funds should improve the overall wellbeing of the economy.

You endorse the concept of a common Caribbean Citizenship programme. How do you see this addressing the main issues, including the price war, due diligence issues and the possibilities of other governments withdrawing visa-free access?

While the Caribbean is not one country, we have to take into account that the rest of the world sees us as one. I respect the sovereign governments and decisions of each Caribbean nation, but I think we should work closer together. This does not mean that all programmes have to be the same, but there should be some common elements. I also don’t think we need to compete against each other. There is enough business for all of us. There are also advantages on the operational side. As an example, if we were to establish a central agency that would perform due diligence checks, it could result in significant operational cost savings for all of us.

With more and more countries choosing to launch their own programmes, do you worry about the commoditisation of programmes and do you believe the industry needs to set a price floor?

There are legitimate reasons why people want a second citizenship, with political and economic instability being two examples. We all wish to have a sense of security, and in my opinion, acquiring a second passport should not be an option only available to the super-rich. I am not even sure that everyone that applied to our programme is a millionaire. I also think that the market will ultimately decide the price and that there is no requirement to agree on a minimum investment.

“If we were to establish a central agency that would perform due diligence checks, it could result in significant Operational cost savings for all of us”

How do you expect the sector to develop over the next five to ten years?

I think the market will continue to grow and that there will be more information sharing, which will allow this industry to blossom. However, going forward countries that are just selling citizenship may not be as successful as countries that brand themselves as holistic lifestyle locations. We, in Saint Lucia, are clearly positioning ourselves as one such location and are actively seeking to diversify our economy. We want to offer our new citizens ample opportunities to get involved in our economy, creating substance and building strong ties to the country. In the long term, I believe this will give the industry more legitimacy.

Have got a piece of advice or a personal message to share with the industry?

Let’s keep talking and work on common standards for this industry.

Source: IM Yearbook 2018/2019