Author: Niu Ltd

A legal technicality has led Cyprus to temporarily halt a process to strip citizenship from 26 individuals who benefited from a secretive passports-for-investment scheme, lawmakers said on Monday.

A lucrative citizenship for investment scheme run by the Mediterranean island has been under scrutiny both in Cyprus and abroad after the disclosure that some of the beneficiaries were high-ranking officials from foreign countries.

More than 3,500 people have gained citizenship under this scheme in recent years.

In November, Cypriot authorities announced they would revoke the passports of 26 individuals, saying the criteria under which citizenship was granted to some people was flawed.

Reuters had reported in October that a number of Cambodians, including its police chief and finance minister, had acquired Cypriot citizenship.

Cypriot government sources had said at the time the group whose passports should be revoked include nine Russians, eight Cambodians, five Chinese nationals, two Kenyans, one Malaysian and one Iranian.

Lawmakers from the Interior Committee of parliament were told on Monday the decision to strip passports could not proceed at present for legal reasons, two of those present told Reuters.

That was because, one said, the relevant law for granting investors citizenship lacked a supplementary clause on the process for revoking it.

“We have a problem with the law which can be fixed relatively easily,” said George Perdikis, a lawmaker with the Greens party.

Nonetheless, he said, “our jaws dropped” when an interior ministry employee said there was a problem with the law as it currently stood. Left-wing lawmaker Eleni Mavrou, who chairs the Interior Committee, told Reuters there was a “legal vacuum” in revoking the passports. “Today we were told that the process won’t go ahead until a committee appointed by the government vets all the information,” she said.

Cyprus has had a citizenship for investment plan in place since 2013, under which a minimum 2 million-euro ($2.2 million) investment can buy a passport and visa-free travel throughout the European Union.

Authorities say the program has gone through several transformations, and was overhauled in February 2019 with five different due-diligence layers, compared with one in 2013.

For transparency reasons, Cypriot lawmakers in February 2019 decided the eligibility criteria of the citizenship scheme be enshrined in law, instead of based on regulations set by the island’s cabinet.

So far the government has not brought those regulations to parliament for discussion and a deadline set by parliament passed at the end of January.

“We have thrown down the gauntlet, we told them (the government) that since there are no regulations, any applications submitted after Jan. 31 can’t be reviewed,” Mavrou said.

 

Source: nytimes.com
Published: 10 February 2020

A coming together of the region’s Citizenship by Investment programmes is needed. This was the plea by the Governor of the Eastern Caribbean Central Bank (ECCB), Timothy Antoine at a recent press briefing here. Antigua and Barbuda, Dominica, St. Kitts and Nevis, and Saint Lucia all operate CBI programmes. There are, however, many differences separating the countries. For instance, the minimum investment required for one applicant in Saint Lucia, Antigua and Dominica is US$100,000, while in Grenada and St. Kitts, it’s US$150,000. Under the real estate option, Antigua’s minimum investment is US$400,000; Grenada, $350,000; Saint Lucia, $300,000; Dominica and St. Kitts, $200,000.

Antoine stated that the ECCB’s view is that the region is seen as one despite what individual countries do. The Caribbean, he says, is a brand, and if there is an adverse development in one island it affects all the others. “So our view is that we have to come together. We believe that the coming together will help all of our CBI programmes. Set the same standards, ensure that if you get denied in country A, you cannot get accepted in country B, because it’s a single space. Set the price reasonable, but not too low. We don’t want to sell ourselves short.”

Anthony noted that the CBI programmes are important to countries in the region and a main source of foreign direct investment. Therefore, Antoine said, the bank has an interest in the industry from a position of financial stability, fiscal and debt sustainability, as well as growth. The ECCB Governor lamented that as a result of competition the price keeps dropping lower and lower.

“We believe that what we have to offer in this region is valuable, is precious, and should be more highly valued. But the only way you can raise the price, and sustain the price for the benefit of all, is if they come together,” said Antoine.  When asked to suggest a price, Antoine said he was “not prepared to go that far”. However, he advised it should reflect the exclusiveness of the region, but not be so high as would price countries out of the market.

On Monday and Tuesday, heads of CBI programmes within the region met in Saint Lucia. Nestor Alfred, the CEO of Saint Lucia’s Citizenship by Investment Unit, told the STAR the meeting was convened to discuss matters relevant to the industry. Alfred, who also serves as the chairman of Citizenship by Investment Program Association, said the two-day meeting was productive, with frank discussions. He noted that individual countries can remain competitive but there are many avenues where collaboration can be achieved; for example, in the areas of exchange of information, and bringing harmonization to application forms.

“If rain falls on the roof on one OECS island,” he said, “it will invariably fall on the roof of every other island. So it’s really important that we do this. And because of the common space that we share, it’s even more important. There are some things that we have agreed on, which I can’t share just now, because each of us has to go back to our islands to make that communication.”

 

Source: stluciastar.com
Published: 9 February 2020

A Concluding Statement describes the preliminary findings of IMF staff at the end of an official staff visit (or ‘mission’), in most cases to a member country. Missions are undertaken as part of regular (usually annual) consultations under Article IV of the IMF’s Articles of Agreement, in the context of a request to use IMF resources (borrow from the IMF), as part of discussions of staff monitored programs, or as part of other staff monitoring of economic developments.

The authorities have consented to the publication of this statement. The views expressed in this statement are those of the IMF staff and do not necessarily represent the views of the IMF’s Executive Board. Based on the preliminary findings of this mission, staff will prepare a report that, subject to management approval, will be presented to the IMF Executive Board for discussion and decision.

 

Growth has recovered strongly in 2018-19 but is set to moderate, with the outlook clouded by downside risks. The Eastern Caribbean Central Bank (ECCB) and individual Eastern Caribbean Currency Union (ECCU) countries have continued to advance their reform agendas, but progress needs to be accelerated. While robust national fiscal frameworks remain key to the region’s policy priorities, well-sequenced steps to regional integration can catalyze capacity and resources. This would include (i) increasing fiscal integration, (ii) enhancing financial integration, and (iii) solidifying the monetary union by raising payment’s efficiency through—but not limited to—cautiously piloting a digital currency.

1.  Growth rebounded in 2018 and has remained robust so far in 2019. ECCU’s GDP growth accelerated to 3¾ percent in 2018, reflecting buoyant tourism and sizable Citizenship-by-Investment (CBI) inflows, which helped support Dominica’s reconstruction-led recovery from the 2017 hurricane. Growth momentum has remained strong in 2019, while inflation has been muted. The region’s fiscal deficits have been edging upwards in 2018-19 despite continued strength in CBI inflows, but with the deficits remaining moderate, the public debt ratio declined in 2018 and is set to fall further in 2019. While the region’s external deficits are high, they are amply financed by FDI flows. Bank credit to the private sector remains weak despite substantial excess liquidity.

2.  Going forward, growth is set to moderate, and risks remain mostly on the downside. GDP growth is expected to gradually ease to 2¼ percent, a long-term historical average for the region. CBI inflows are also projected to moderate. In the near term, economic activity would be supported by further post-hurricane reconstruction, tourism investment, and some agribusiness projects. Achieving the 60 percent of GDP debt target would remain challenging for most countries. Global risks, such as adverse confidence effects from rising protectionism and weaker US growth, could weigh on the outlook. Region-specific risks include natural disasters, increasing banks’ foreign exposures, continuing exit of global banks, and continued pressures on corresponding banking relationships (CBRs) against the backdrop of elevated non-performing assets. Positive surprises in CBI inflows, if well-managed, constitute potential upside risks.

3.  Greater regional integration can substantially complement robust national policies in improving the outlook and mitigating risks. ECCU’s challenges are compounded by large shocks and lack of economies of scale. Robust national fiscal responsibility frameworks that ensure public debt sustainability and buffers are crucial for improving the ECCU growth potential. ECCB’s advocacy for achieving the 60 percent of GDP debt target by 2030 through national fiscal responsibility frameworks and its efforts to improve debt management have supported this process. In addition, IMF staff analysis suggests that well-sequenced steps toward regional integration can catalyze resources for better policy responses, as elaborated below.

A. Increasing Fiscal Integration

4.  Regional coordination of selected revenue policies could create fiscal space for ECCU’s public investment. The ongoing “race to the bottom” in competing for tax incentives and CBI program conditions limits the potential to raise revenue that could be channeled to productive spending, including resilience building. This highlights scope for the ECCU countries to coordinate tax incentives and CBI program conditions, while achieving the objective of making FDI more attractive through better infrastructure. In this context, the authorities’ ongoing collaboration on CBI programs’ financial integrity to improve their transparency and governance could help lower negative perceptions about the use of CBI programs. Such collaboration could support region-wide sustainability of these flows and financial stability.

5.  Over the longer term, a regional pooling of fiscal resources can complement national fiscal buffers to build resilience against natural disasters and other shocks at a lower cost. While individual ECCU countries face similar risks, natural disasters put them in different economic conditions at a given time. The regional pooling of resources saved by limiting excessive growth of public consumption in good times could support macroeconomic stabilization and create scope for resilience building and other growth-enhancing investment in bad times. Staff calculations suggest that the size of a pooled fund would be about one-half of the sum of individual countries’ funds for the same stabilization effect. Such an arrangement would require a strong governance framework and should be financed by national budgets to protect ECCB’s international reserves and the credibility of its quasi-currency board arrangement. This pooling of resources could complement national insurance strategies against natural disasters, a key pillar of the Disaster Resilience Strategies currently being piloted in Dominica and Grenada.

B. Enhancing Financial Integration

6.  Accelerated progress on the ECCB’s reform agenda will help address financial system vulnerabilities. The ECCB in its capacity of a region-wide bank supervisor and regulator has continued to advance essential reforms, including strengthening its financial system stability function with deepened interaction with regional regulatory authorities, identifying regionally-systemic financial institutions, and improvement to its Financial Stability Report. The implementation of risk-based supervision, phase-in of Basel II/III standards, technology upgrades for supervisory operations, and enhanced AML/CFT frameworks continue to build supervisory effectiveness. Additional reforms are currently being pursued, such as establishing a shared services platform for indigenous banks; developing a deposit insurance scheme; implementing an e-conveyancing regime for collateral realization as part of the initiative to modernize insolvency frameworks; harmonizing non-bank financial laws; operationalizing a credit bureau; and preparing guidelines for the treatment of impaired assets. Authorities are also considering a macro-prudential framework for financial sector stability including the Lender of Last Resort (LOLR) function; and a framework for optimal regulation of the financial sector.

7.  The reform agenda needs to be prioritized with key short-term actions. Despite improvements in Non-Performing Loans (NPLs) in most jurisdictions, efforts to repair bank balance sheets should be stepped up by (i) adopting effective plans for all banks to reduce NPLs below the 5-percent benchmark by end-2023, including via sales to the Eastern Caribbean Asset Management Company (ECAMC); (ii) requiring banks’ disposal of non-banking assets (including land); and (iii) strictly enforcing exposure limits and market risk management. ECCB’s and deposit-taking institutions’ governance frameworks should be reviewed and passage of critical legislation, including AML/CFT, should be expedited by remaining countries to increase compliance and enforcement. Consolidated supervision of financial groups should be advanced. Urgent measures are also necessary to monitor and address operational risk, including due to CBRs and cybersecurity. The new treatment of impaired assets standard, now expected by January 2020, should be implemented without delay.

8.  Provided the critical short-term priorities are addressed, steps toward a fuller banking union could take place in the long term. These would involve: (i) enhancing the financial safety net with a robust deposit insurance scheme and (ii) establishing a regional resolution and crisis management framework. Both these steps require operationalizing credible fiscal backstopping as a key precondition, based on minimum regional fiscal responsibility commitments entrenched in national laws. Other reforms that should be implemented include: (i) advancing the regulatory regime for systemic institutions (including non-banks) to minimize regulatory gaps and shock propagation; (ii) consolidation of regional non-bank financial sector oversight to enhance coverage, address sector-specific risks, reduce compliance costs, and mitigate resource constraints; and (iii) progressing the establishment of a macroprudential mandate and toolkit to address region-wide systemic risk.

C. Solidifying the Currency Union by Raising Payment System’s Efficiency

9.  Building on the successful launch of the Electronic Funds Transfer, the ECCB, national authorities, and financial institutions should continue efforts to modernize the payment system. Major banks have recently begun to offer various electronic payment services. The authorities are also examining options to integrate credit unions in the core payment systems. This would help competition, but it should be considered in the context of establishing an appropriate prudential oversight framework. The ongoing review of the legal framework pertaining to the payment system is also critical to allow emerging Fintech and nonbank e-payment services to operate and innovate. Advancing e-government initiatives would also help increase the volume of digital payments to help address small-economy constraints and enhance the business opportunities for the private sector. In this context, the Digital Economy Project, which is currently in its preparatory phase, would support digital transformation of key services provided by ECCU Governments. Early introduction of a digital ID is needed to support these initiatives.

10.  The digital currency pilot project, launched by the ECCB, should proceed cautiously as planned. The authorities view the digital currency as an option to reduce excessive reliance on cash and cheques; improve the efficiency of the retail payment system; and support economic development by reducing financial frictions. To contain vulnerabilities, important safeguard measures are embedded in the design of the digital currency, such as the limited size of its holding and transaction values, no interest accrued; and does not include foreign currency transactions. That said, the digital currency could expose the ECCB and the financial system to various risks, including those related to financial intermediation, financial integrity, and cybersecurity. The pilot will provide the opportunity to examine these risks, test the design of the digital currency, and assess any policy gaps. After the pilot, the ECCB is planning to thoroughly review its results, and more work may be warranted, especially to further test the digital currency system, strengthen cybersecurity and AML/CFT operations, and update legal and regulatory frameworks.

 

Source: imf.org
Published: 7 January 2020

 

To ensure the immigration program’s uprightness, following second citizenship demand, the administration says it is focused on dedicating funding for progressively powerful security checks.

“The interest for economic citizenship in our nation brought about expanded expenditure for individual verifications and other expanses related with the support of a powerful CBI Program,” said Prime Minister Harris.

Harris believes the two islands are “the best in the business around the world,” which is the reason under the due diligence process every candidate for citizenship is completely screened.

In the wake indenpence, the islands presented the CBI program in 1984. It is a financial citizenship program, which PM Harris claims is “considered the most alluring, and that is shown by the certainty of our customers and operators.”

People contributing at least $150,000 to the Sustainable Growth Fund (SGF), and who have passed the diligence checks, can get second citizenship. The program means to encourage financial activities. Monetary residents can travel visa free or get visa on appearance for in excess of 150 nations and regions.

Canada, the U.S. furthermore, most E.U. nations have adopted comparative citizenship by investment programs.

 

Source: wicnews.com
Published: 2 February 2020

 

The UK is set to leave the European Union today at 11pm, 31 January 2020, with Brexit day marking a new era for the nation and the future of UK immigration policy. Over the past three decades, immigration to the UK has boomed. Since 1990, 14 million people have arrived in the UK and nine million have left, leaving a net inflow of five million people.

UK Prime Minister, Boris Johnson, has stated that a post-Brexit immigration system will put ‘people before passports.’ Speaking at the recent UK-Africa Investment Summit, Mr Johnson said UK immigration would become “fairer, treating people the same wherever they come from.”

While the UK will officially leave the EU at 11pm on 31 January 2020, freedom of movement for British and EU citizens will not end until 31 December 2020, following a ‘Brexit transition period’.

Australian-style points-based UK immigration and visa system

Following the transition period, the UK government plans to introduce an Australian-style, points-based immigration system by January 2021. However, UK Home Secretary Priti Patel has urged the government to implement the Australian-style system by the end of 2020.

Meanwhile, the Migration Advisory Committee (MAC) – a so-called independent body that advises the UK government on matters of immigration – rejected an Australian-style system, describing the plan as ‘a soundbite’.

The MAC’s criticism of the system has left the Conservative government scrambling to rescue the Prime Minister’s pledge to introduce an Australian-style immigration system.

A MAC report said: “The implementation of such a system – based on factors such as age, qualifications and previous study in the UK – risks repeating past mistakes and should be introduced for highly skilled migrants only.”

Instead, the MAC advised a minimum salary threshold for most workers offered a job – a system Mr Johnson sought to scrap – but set at £25,600 instead of the £30,000 proposed under Theresa May’s premiership.

Elsewhere, the Nuffield Trust – a health think tank – slammed the government’s proposals, saying an Australian-style system would make it ‘virtually impossible for foreign nationals to work in most frontline social care jobs in the UK.’

Business leaders criticised the government’s rejection of regional UK visas and any movement on a £25,600 minimum salary threshold, arguing that it would be catastrophic for companies based in poorer parts of the UK – mostly outside London.

However, Priti Patel has suggested that the MAC report would be rejected following the sacking of the body’s chairman, Professor Alan Manning.

Patel said: “The British public voted for change when it comes to immigration and with that they have voted for an Australian-style points-based system. The MAC’s recommendations are purely advisory.”

UK employers urged to ‘get their house in order’ ahead of Brexit day

A report published by Personnel Today urged UK business leaders to ‘get their houses in order’ ahead of the UK’s full divorce from the EU.

A number of business groups have said that while nothing will happen immediately after Brexit day, due to the transition period, employers need to use the time to be fully prepared come 31 December, 2020.

Many UK employers fear that Brexit will stifle plans to retain and attract overseas staff in the future. Manufacturers in particular seemingly face huge challenges, with 81% of firms saying that they’re having difficulty hiring skilled employees.

However, economist and CEO at people analytics firm Orgvue, Rupert Morrison, launched a scathing attack on UK businesses, saying that employers need to ‘get over’ their Brexit fears and start planning for a future outside the EU.

Morrison said: “British businesses need to grow up and quit complaining about Brexit as though it’s breaking news and they haven’t had a chance to prepare.”

Mr Morrison continued: “Large companies in the UK are currently investing more in their telecoms services than they are on understanding their business, the work that needs to be done, and the workforce they need to achieve it.”

“It’s no wonder business leaders are using Brexit as an excuse for growth concerns. But one referendum, two elections, three prime ministers and four years later, businesses are somehow still floundering due to ‘uncertainty’ and skills shortages,” Morrison added.

The future of UK immigration and visa policy

Uncertainty still looms over the future of UK immigration in a post-Brexit era. The issue clearly divides opinion. A series of celebrations and protests have taken place across the country to mark what will be an historic day in British history.

However, with the UK Home Secretary hinting that the government will go against the MAC’s recommendations, it seems that an Australian-style points-based immigration system is likely to represent the future of UK immigration.

Prior to his sacking, former MAC chairman Professor Alan Manning said: “No other country uses a points-based system as its only route for work migration.”

However, Professor Manning did add that ‘while immigration hasn’t harmed employment opportunities or wages, it hasn’t really benefitted them very much either.’

 

Source: workpermit.com
Published: 31 January 2020

The controversial cash-for-passports scheme will be retained, Prime Minister Robert Abela confirmed after pressure from the opposition and the business lobby to suspend or scrap it.

Dr Abela was speaking after Nationalist party leader Adrian Delia said he had refused to consult with the government on who should be appointed the programme’s regulator.

Dr Delia said he had told Dr Abela that it was time to scrap the Individual Investor Programme, which sees wealthy individuals pay for Maltese, and therefore EU, citizenship.

In a tweet he said the so-called ‘golden passports’ scheme should end because it had “left our country’s reputation in tatters”.

“As Opposition and PN leader, I refused to be consulted on the appointment of the scheme’s regulator,” he said.

Dr Delia has long called for a suspension of the scheme and last week, the Chamber of Commerce also said it should be paused.

According to the latest annual report, the programme raised €271.6 million in the last financial year, which equated to 2.11 per cent of the country’s wealth (GDP).

However, sales have dropped persistently and the current regulator Carmel De Gabriele partly blamed the fall on bad publicity.

The scheme has come under the spotlight, with an EU Parliament delegation describing it as risking “importing criminals and money laundering into the whole EU”.

However Dr Abela told Times of Malta he had no plans to either suspend or scrap the scheme.

“I have already stated that I plan to stick with the scheme,” he said on Friday.

“If I have to make any due diligence changes I will but the scheme has brought a lot of good to the country and I want to preserve it.”

However he stated that the due diligence surrounding the scheme was already very high, evidenced by the volume of applications that are rejected.

Dr Abela said it was a mistake for Dr Delia not to consult with him over appointing a regulator.

“I wished to have his input. I think that to abdicate from this responsibility is a mistake on his behalf.”

“I’m ready to collaborate with him over this issue as I believe this collaboration would lead to better results.”

 

Source: timesofmalta.com
Published: 1 February 2020

Following a comprehensive round of retroactive due diligence on citizenship by investment applications approved prior to the 2018 tightening of vetting procedures, Cypriot authorities identified 26 cases of inappropriate naturalizations. To rectify missteps of the past, the government vowed to revoke those citizenships.

But the country’s own citizenship law has so far foiled the revocation plans. Philefteros explains the convoluted legal issue:

Jho Low, the family of Hun Sen, and other CIP-naturalized Cypriots whose passports were destined for the shredder are, consequently, still in possession of their citizenships. This impasse is unlikely to last very long, however, as the ministers of Interior and Justice are reportedly planning to meet with the Attorney General “soon” to discuss how the law can be amended to accommodate the special circumstances.

In a piece of good news for the program, the three due diligence firms officially appointed to audit applications going back to 2013 report that they have identified no further cases, beyond the 26, of CIP-citizens doing anything to warrant alienation.

 

Source: imidaily.com
Published: 5 February 2020

The Commonwealth of Dominica has established a new embassy in the capital of the United Arab Emirates, Abu Dhabi – becoming the first Dominican mission to the country, but also to the Middle East.

Speaking during the opening ceremony, earlier this week, Dominican Prime Minister, Roosevelt Skerrit, said the embassy also comes to service a ‘small but dynamic’ community of Dominican economic citizens, which is growing via the island’s world-leading Citizenship by Investment (CBI) Programme.

The government of Dominica has appointed Hubert John Charles as the Ambassador to the UAE.

Prior to his new appointment, Charles served as the Dominican Ambassador to the United States and as the Permanent Representative of Dominica at the Organisation of American States.

“Thanks to the Citizenship by Investment Programme, Dominica already has a small but dynamic population, resident in the UAE and contributing to the dynamism of its service sector and to sustainable development at home,” said Skerrit.

He added that the new Dominican Embassy in Abu Dhabi will serve as “a crucial link between what is in effect the Dominican diaspora, here, in the UAE and the homeland.”

“As a result of the success and good reputation of the CBI Programme, investors’ trust in both, Dominica and its Programme remains unshaken. Dominica grants successful CBI applicants valuable citizenship benefits like family security, visa-free and visa-on-arrival travel to 140 destinations and growing business opportunities.”

Middle Eastern families and single individuals can obtain Dominican citizenship upon making an investment into the island’s economy, but only if they pass all the due diligence checks. Applicants choose from either making a minimum US$100,000 contribution to the Economic Diversification Fund or an investment worth at least US$200,000 in pre-approved real estate, comprising a selection of luxury hotels.

With a growing number of economic citizens from the UAE, the Prime Minister said that his administration will assist its new citizens.

The Dominican Embassy in Abu Dhabi will provide consular services to Dominican nationals, issuance of documentation, emergency notices, tourism advice and other services.

 

Source: caribbeannationalweekly.com
Published: 27 January 2020

Cypriot Foreign Minister Nicos Christodoulides has told local press he expects new developments soon with regards to a visa-waiver agreement with the United States.

“Our aim is to have developments towards that direction within 2020,” Christodoulides said on Tuesday, according to Cyprus Mail, adding that the competent deputy minister of the US government was slated to visit the island this month to discuss the way forward for a visa-waiver agreement between the two countries. The question of how to achieve the goal will be the subject of conversation during the official visit, which will include meetings with the Ministries of Justice and Interior.

The US’ visa waiver program is an exclusive club consisting of only 39 member countries, including most EU member states with the exceptions of Cyprus, Bulgaria, Croatia, and Romania.

The EU has an “umbrella” visa-waiver agreement with the United States – whose citizens are welcome without a visa in all EU countries – and has repeatedly prodded the US to reciprocate by extending that privilege to all its member states. The US, meanwhile, has stated intentions to include also the remaining EU members but wants those countries to first comply with certain criteria on “security, crime, and terrorism”.

All four EU-member states remaining outside the visa-waiver program have ratified agreements on “Preventing and Combating Serious Crime” and are now working to fully implement the measures thereto pertaining.

 

Source: imidaily.com
Publication: 20 January 2020