Feature Address by Dr. the Hon. Timothy Harris, Prime Minister and Minister of Finance at the Caribbean Investment Summit St. Kitts Marriott Resort ~ June 20, 2019

As Prepared for Delivery

Salutations

35 years ago, St. Kitts and Nevis embarked upon a visionary path in its efforts to enlarge the economic freedom of its people. It took stock of its relative insignificance in the international geopolitical space and determined that it will mark out a niche for itself and its newly independent people by pioneering the Citizenship by Investment Programme.

Here was the smallest independent state – conscious of the onerous challenges of nation-building – bringing its ingenuity to envision how a small Country could overcome the constraints of limited factors of production by inviting other nationalities to invest and become its citizens. It was hoped that these new “economic citizens” as they become popularized would bring their resources, particularly their wealth, talent and diversity, to aid in nation-building. Our Constitution provides for Parliament to determine who may become citizens beyond those normally entitled to citizenship through birth, marriage and descent.

35 years after the idea was born, others far and near like the USA, Canada, the UK, Malta and Cyprus have adapted with various permutations an idea whose birth and intellectual producer was the Government and people of St. Kitts and Nevis. 35 years ago, intellectual property rights were not vogue and others capitalized on the intellectual work of St. Kitts and Nevis.  We are happy to have made this enduring contribution to the rest of the World and humanity.

Today our CBI programme is still the oldest and best programme. The programme has grown in significance and scale.  Its contribution to Government revenue is significant in St. Kitts and Nevis and in other member states of our sub-region like Dominica, Antigua and Barbuda, Grenada and St. Lucia to a lesser extent.

Our landscape has been transformed. Construction is a major driver of economic growth. The build-out of the Four Seasons Residences, Ramada, Wyndham and Park Hyatt all owe their progress and success to the CBI programme here in St. Kitts and Nevis.

A Most Resilient Programme 

How have we survived 35 years? We had the good sense to stay ahead of the market, save for the dark period of maladministration prior to 2015. My administration has since strengthened the CBI programme, reformed it administratively and legislatively, imposed the most vigorous due diligence tests, rebuilt trust with international partners, and held and continues to hold open and frank discussions with the EU, Canada and the USA regarding our programme.

We are a responsible and respected member of the international community. Our ranking in the rule of law is the best in the OECS, second in CARICOM and we are among the 30 best performing countries on the World Justice Project Rule of Law Index 2019. We are ranked as largely compliant on OECD transparency in tax cooperation – the same rank as the United States of America.  We are a most cooperative jurisdiction on several indices.

Lessons Learned

These 35 years have also provided us moments from which key lessons have been learnt.  These lessons, and the extent to which we are able to apply them to future policies and practices relating to citizenship by investment, hold the key to the sustainability of our successes in this industry.

  1. Our experiences over the last 35 years, and particularly in the last 5-10 years, have underscored the crucial importance of ‘building resilience’ for our Citizenship Programmes across the Caribbean.
In St. Kitts and Nevis, my Government took significant steps to reform our programme and to correct the failures of the former regime.  My Government was able to take decisive action in the first 18 months in office, focusing on legislative and institutional changes, in order to guard our treasured citizenship programme. We: (i) imposed the most vigorous due diligence tests; (ii) enhanced the capacity of our CIU with the best talent and the brightest minds in a range of operational areas. We also (iii) launched our world-star platinum standard brand in 2016, and (iv) legislated to facilitate and support the changes my Government was introducing. Through these specific actions, we were able to rebuild trust with international partners.Today, as I stand here, the clear and unmistakable result of building resilience is that our programme continues to attract high net worth individuals in search of a reliable and trusted brand.

Proofing our programmes to withstand political over-involvement and the risk of mismanagement has been my Government’s way of building resilience. But it has not been the only way. The last 5 years have shown us how hurricanes and other natural disasters necessitate building another kind of resilience in respect of our CBI programmes – that is, resilience in relation to our natural landscapes and economic life. The devastation wreaked upon our island states in the last 5 years has brought into focus the importance of climate resilience to our CBI programmes. On the one hand, the ability of our nations to absorb the shock of these disasters, which have been growing both in frequency and intensity, has proven crucial to protect investments particularly in real estate. On the other hand, our exposure to these natural disasters has compelled us to evolve and adapt to ensure that the economies of our island states can benefit from direct investment to recover from and guard against widespread destruction to property and infrastructure. In St. Kitts and Nevis, the Hurricane Relief Fund was one of our innovations that demonstrated the flexibility and adaptability that is part and parcel of the resilience that is required.

Since the Fund was established in October 2017, its proceeds have improved the quality of life of over 2,000 households through the Government’s Hurricane Repair Housing Assistance Programme.

  1. All countries that are participating in Citizenship Programmes have prioritized and improved due diligence as a central feature of operations. Our programmes operate within an increasingly inter-connected world – a global village in which foreign policy and geopolitical complexities of countries far beyond our shores invariably influence and impact on our programmes. In the context of a global thrust in the areas of anti-money laundering and countering the financing of terrorism, our regions have assumed a certain responsibility in collaboration with our international partners to ensure that our programmes are not susceptible to undesirable and illicit actors.  We invite all participants to do their very best to ensure only characters of high repute are invited to our programme.
Our multi-agency approach to due diligence, which no doubt has become industry standard across the region, has resulted in our regional programmes being highly regarded as safe and robust.
  1. A third lesson that the last 35 years have brought to the fore for our regional CBI jurisdictions is the importance of collaboration and harmonization of standards across the region. This is what CIPA is mandated to do, and other institutions such as ECCB have been working to ensure progress in this area.  The very critical work of JRCC is also commended.  We cannot do it alone.
  1. A fourth and final lesson is this: the socio-economic empowerment and the improvement in the quality of life for all our citizens should remain the lifeblood and calling of each of our programmes. Ultimately, the measure of success of our CBI programmes is indicated by the extent to which we are able to convert inflows into our programmes into real, sustained and meaningful improvements in the lives of our people, and in the overall development of our island nations.
Our policies, pricing strategies, and even our discourse about citizenship by investment must always emphasize the inextricable link between successful applicants to our programmes and the observable, actual development in and around our countries.  Across our region we see the positive impacts our citizenship by investment programmes make on construction, job creation, hotel stock, housing stock, social safety nets, etc.

These transformations— made possible by the careful management of our citizenship programmes are the ultimate purpose of CBI in our region. It is a lesson we can hardly remind ourselves of too much.

Towards A Brighter Future

At this juncture, as we celebrate our successes and reflect upon the lessons we have learned over the last 35 years of Caribbean citizenship by investment, the single most important task for our jurisdictions is to protect, consolidate and build upon those successes. We must meet the challenges and opportunities of the next three decades of Caribbean CBI with: (i) the vision and foresight of the architects of our regional industry; (ii) even greater ingenuity, imagination and innovation; and above all (iii) the leadership and resolve to execute the blueprint for this industry over the coming years.

Requires Innovation

After 35 years, we are called as a region to constantly innovate and lead.  We must not allow this momentum to lose pace.

As a region, we cannot afford to fall behind, and I am assured by:

  • The current exploration into the use of biometric data for applicants, to strengthen the security and verification features of our programmes.
  • The emergence of smart tech tools like RCBI Direct, which is being launched at this Summit, and the vast potential it can unleash for our local developers.
  • The increasing use of online technologies to provide authoritative information about our programmes and investment opportunities in our countries to people all around the world.
But the innovation that is required is not just about material technology. The future of CBI in our region requires a new wave of imagination about the products and services we offer, the institutional infrastructure and our distribution and sales models.

One area in which the region has demonstrated its appetite for this kind of innovation is in ongoing discussions among regional stakeholders about the best way to leverage existing regional institutions to strengthen the work of individual CBI jurisdictions.

We must continue to challenge current approaches to ask ourselves ‘How can we extend our reach? Are there existing opportunities that are yet to be identified and explored? How can we improve and transform the industry for the ultimate improvement of the lives of the people we serve?’

Requires Leadership

To pursue this new vision and to execute the innovation that the next decade of CBI requires, there is a need for our continued leadership in this global industry. As a region, we must continue to lead the agenda, set and raise industry standards and shape the future of global migration and industry trends in the years to come. This is our mission. It is our mandate, as the early movers in this industry, to meet the challenges and opportunities that the next decade will bring and to address them in a way that redounds to our benefit.

Some Challenges

We know what some of the challenges are. Over the course of this week, you will hear from speakers who will discuss:

  • Risks re: OECD
  • EU blacklisting – thankfully, none of our CBI countries in the Caribbean are on the blacklist
  • Constraints on correspondent banking
  • Specific reputational risks
These are some of the risks that require a firm resolve from our region. Focused and coordinated leadership is needed. We cannot shy away from this responsibility. We must continue to make use of lobbying and negotiating machinery, as well as our diplomatic good offices, to have open and frank discussions with our international partners on matters pertaining to our CBI jurisdictions.  It is our duty to ensure that decision-makers elsewhere fully appreciate the impact of their decisions and policies in our region and for our CBI jurisdictions, and we must make the case strongly and boldly so that as a region we continue to attract high net worth individuals.  We are grateful to Ernst & Young for its work on CBI and its findings that our regional CIPs are not avenues for tax evasion.

Forward-looking leadership also demands of us, at all times, to make clear that citizenship is an honour, a privilege and package of legal rights and obligations bequeathed to the economic citizen, and, for this, we expect of citizens by their conduct to add value to our nations and people. It is on the firm grounds of ethical leadership that we should pronounce clearly that as a region: (i) we will always maintain the strongest and most robust due diligence programme in the world; (ii) we will cooperate with all nations and entities, in particular the USA, Canada, the EU, Interpol, JRCC, etc.; and (iii) we will never condone wrong or become a haven to illicit actors. We want persons not just of high net worth but of high integrity and excellent character to become part of our citizenry.

Having led the innovation of this niche industry back in 1984, and having made significant and pioneering contributions to citizenship by investment as we have come to know it, our region is uniquely and ideally positioned to lead the advances in this industry in the coming three decades of Caribbean CBI.

Standing on the strength of our successes over 35 years, I am confident that this new wave of vision, innovation and leadership will enable our region, small as we are, to carry this booming industry to even greater success.

Closing

I thank you again for participating in this Summit.  I hope that all of us will take advantage of the vast potential to network, to strengthen our friendships and to learn more about CIPs in the region.

May God Bless Our Region and People!  May God Bless All of Us!

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