No ‘race to the bottom’ for St Kitts and Nevis CBI

Last updated: October 31, 2017 at 7:33 am

The department that manages the Citizenship by Investment Programme in St Kitts and Nevis has stressed that the country will not engage in a “race to the bottom” to secure funds.

Earlier this month, the cost of applications for the Antigua and Barbuda scheme was slashed to US$100,000, and St Kitts and Nevis has recently introduced a cheaper option – the Hurricane Relief Fund – that costs US$150,000.

The temporary additional method, which will sit alongside the existing $450,000 and $250,000 choices until early next year, has split opinion.

Prime Minister Timothy Harris believes it will have “a direct impact on the quality of life” of those in the federation, while opposition leader Denzil Douglas believes it could harm the economies of hurricane-ravaged islands nearby.

Douglas also questioned the fund’s purpose, fearing that without proper legislation it could become a “slush fund in order to facilitate him [Harris] – and his cronies – to get back into office.”

But Les Khan, CEO of the Citizenship by Investment Unit (CIU), believes that there has been “consistent excellence and professionalism associated with the platinum brand of the St Kitts and Nevis citizenship programme.”

'Competitive'

The federation’s citizenship by investment offering is the oldest in the world, and is regularly referred to as the “platinum standard”.

According to the CIU, there has been in increased increase in applicants to the programme.

Earlier this month, Khan addressed accusations of cutting costs to fend off competitors.

“We originally set a price that we felt was competitive, but was also one that maintained the standard of a platinum brand and one that was still higher than everyone else’s,” he said.

“There will be further adjustments, I believe, by other countries but we will not be engaged in that race to the bottom.”

[caption id="attachment_1002" align="aligncenter" width="500"] Former prime minister and opposition leader Denzil Douglas.[/caption]

Denzil Douglas, who was prime minister from 1995 until 2015, has been stinging in his critique of the Harris-led government, especially when it comes to economic citizenship.

He said last week that the prime minister had “destroyed our once upon a time globally-leading Citizenship by Investment Programme in his narcissistic and corrupt attempts to create a Harris Re-Election Slush Fund”.

A “frantic desire to sell 4000 Kittitian-Nevisian passports in six month” will compromise due diligence vetting, Douglas added.

Timing

One of the major attack points by the St Kitts-Nevis Labour Party was the timing of the Hurricane Relief Fund’s introduction.

It came on 22 September, less than a week after Dominica was devastated by Hurricane Maria.

Although the federation was damaged – the cost of repairs is disputed between political parties – it did not suffer on the scale of Dominica, or Barbuda during Hurricane Irma just a week before.

As well as labelling it an excuse for Harris to boost his election coffers, Douglas emphasised that such measures could “undermine the desperate recovery efforts that are underway”.

Prime Minister Timothy Harris, who said after criticism that some of the money raised by the Hurricane Relief Fund could help other countries in the region, said that CBI pricing is a market issue.

“We do not have an OPEC-like arrangement where countries participating in the citizenship programme come together and determine the price,” he said.”

“And so each country, each jurisdiction at its sovereign wish, would make those judgment calls, and we respect that and we will let the market play out in terms of its responses to these issues.”