Antigua and Barbuda is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU). According to Eastern Caribbean Central Bank (ECCB), as of December 31, 2019, Antigua and Barbuda had an estimated Gross Domestic Product (GDP) in market prices of $1.72 billion in 2019, with forecast growth of 6.75 percent in 2020. The economy of Antigua and Barbuda remained buoyant, driven mainly by increased tourist arrivals and ongoing public and commercial construction projects. However, due to the coronavirus pandemic, these projections have been revised downwards significantly, with expected declines in revenues and increased spending on imports such as medicine, medical equipment, and food. The government has stated it remains committed to improving the business climate to attract more foreign investment and stimulate growth.
In the World Bank’s 2020 Doing Business Report, Antigua and Barbuda ranks 113th out of 190 countries rated. The scores remained relatively unchanged from the previous year, but highlighted some improvements in starting a business.
The government strongly encourages foreign direct investment (FDI), particularly in industries that create jobs and earn foreign exchange. Through the Antigua and Barbuda Investment Authority (ABIA), the government facilitates and supports FDI in the country and maintains an open dialogue with current and potential investors. All potential investors are afforded the same level of business facilitation services.
While the government welcomes all FDI, tourism and related services, manufacturing, agriculture and fisheries, information and communication technologies, business process outsourcing, financial services, health and wellness services, creative industries, education, yachting and marine services, real estate, and renewable energy have been identified by the government as priority investment areas.
There are no limits on foreign control of investment and ownership in Antigua and Barbuda. Foreign investors may hold up to 100 percent of an investment.
Antigua and Barbuda’s legal system is based on British common law. There is currently an unresolved dispute regarding expropriation of an American-owned property. For this reason, the U.S. government recommends continued caution when investing in real estate in Antigua and Barbuda.
In 2017, the government signed an intergovernmental agreement in observance of the U.S. Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in Antigua and Barbuda to report the banking information of U.S. citizens.
1. Openness To, and Restrictions Upon, Foreign Investment
Policies Towards Foreign Direct Investment
The government of Antigua and Barbuda strongly encourages FDI, particularly in industries that create jobs, enhance economic activity, earn foreign currency, and have a positive impact on its citizens. Diversification of the economy remains a priority.
Through the ABIA, the government facilitates and supports FDI in the country and maintains an open dialogue with current and potential investors. While the government welcomes all FDI, it has identified tourism and related services, manufacturing, agriculture and fisheries, information and communication technologies, business process outsourcing, financial services, health and wellness services, creative industries, education, yachting and marine services, real estate, and renewable energy as priority investment areas.
Limits on Foreign Control and Right to Private Ownership and Establishment
There are no limits on foreign control of investment and ownership in Antigua and Barbuda. Foreign investors may hold up to 100 percent of an investment, and a local or foreign entrepreneur needs about 40 days from start to finish to transfer the title on a piece of property. In 1995, the government established a permanent residency program to encourage high-net-worth individuals to establish residency in Antigua and Barbuda for up to three years. As residents, their income is free of local taxation. This program is separate from the Citizenship by Investment (CBI) program.
The ABIA evaluates all FDI proposals and provides intelligence, business facilitation, and investment promotion to establish and expand profitable business enterprises. The ABIA also advises the government on issues that are important to the private sector and potential investors to increase the international competitiveness of the local economy.
The government of Antigua and Barbuda treats foreign and local investors equally with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.
Other Investment Policy Reviews
The OECS, of which Antigua and Barbuda is a member, has not conducted a trade policy review in the last three years.
Business Facilitation
Established in 2006, the ABIA facilitates foreign direct investment in the aforementioned priority sectors and advises the government on the formation and implementation of policies and programs to attract investment. The ABIA provides business support services and market intelligence to all investors. Its website is: http://investantiguabarbuda.org/. It also offers an online guide that is useful for navigating the laws, rules, procedures, and registration requirements for foreign investors. The guide is available at http://www.theiguides.org/public-docs/guides/antiguabarbuda.
All potential investors applying for government incentives must submit their proposals for review by the ABIA to ensure the project is consistent with national interests and provides economic benefits to the country.
In the World Bank’s 2020 Doing Business Report, Antigua and Barbuda ranks 130th out of 190 in the ease of starting a business. The establishment of a new business takes nine procedures and 19 days to complete. This time was reduced by three days because the government made improvements to the exchange of information between public entities involved in company incorporation. The general practice is to retain a local attorney who prepares all the relevant incorporation documents. A business must register with the Intellectual Property and Commerce Office (IPCO), the Inland Revenue Department, the Medical Benefits Scheme, the Social Security Scheme, and the Board of Education. The government continues to explore ways to further expedite the process.
The government of Antigua and Barbuda continues to advance the work of the Antigua and Barbuda Business Innovation Center (ABBIC), a two-year project to assist small business and entrepreneurs. The ABBIC includes a business incubator and provides education, training, and investment opportunities to new and existing businesses. The Innovation Center focuses on businesses in the healthcare, tourism, agriculture and environment sectors, as well as projects submitted by women.
Through the Prime Minister’s Entrepreneurial Development Program (EDP), people with disabilities can apply for a special incentive grant. The EDP will also provide opportunities for female and young entrepreneurs in keeping with government’s mandate to support the growth of niche markets, innovation, the intellectual capital and ingenuity of its citizens, and the development of micro-, small- and medium-sized enterprises.
Outward Investment
Although the government of Antigua and Barbuda prioritizes investment retention as a key component of its overall economic strategy, there are no formal mechanisms in place to achieve this. In order to sustain future economic growth, Antigua and Barbuda’s economy depends on significant FDI.
There is no restriction on domestic investors seeking to do business abroad. Local companies in Antigua and Barbuda are actively encouraged to take advantage of export opportunities specifically related to the country’s membership in the OECS Economic Union and the Caribbean Community Single Market and Economy (CSME), which enhance the competitiveness of the local and regional private sectors across traditional and emerging high-potential markets.
13. Foreign Direct Investment and Foreign Portfolio Investment Statistics
Please note that the following tables include FDI statistics from three different sources, and therefore will not be identical. Table 2 uses U.S. Department of Economic Affairs (BEA) data when available, which measures the stock of FDI by the market value of the investment in the year the investment was made (often referred to as historical value). This approach tends to undervalue the present value of FDI stock because it does not account for inflation. BEA data is not available for all countries, particularly if only a few U.S. firms have direct investments in a country. In such cases, Table 2 uses other sources that typically measure FDI stock in current value (or historical values adjusted for inflation). Even when Table 2 uses BEA data, Table 3 uses the IMF’s Coordinated Direct Investment Survey (CDIS) to determine the top five sources of FDI in the country. The CDIS measures FDI stock in current value, which means that if the United States is one of the top five sources of inward investment, U.S. FDI into the country will be listed in this table. That value will come from the CDIS and therefore will not match the BEA data.
Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source*
USG or international statistical source
USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data
Year
Amount
Year
Amount
Host Country Gross Domestic Product (GDP) ($M USD)
Table 3: Sources and Destination of FDI
Data not available.
Table 4: Sources of Portfolio Investment
Data not available.
Dominica
Executive Summary
The Commonwealth of Dominica (Dominica) is located between the French territories of Guadeloupe and Martinique in the Leeward Islands chain of the Lesser Antilles. Dominica is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU). Dominica had an estimated gross domestic product (GDP) of $596 million in 2019. Prior to the COVID-19 crisis, growth was forecast at 5.47 percent for 2020, according to Eastern Caribbean Central Bank (ECCB). However, the coronavirus pandemic has reduced the gains that were expected to strengthen Dominica’s economic position in the near term. Preliminary estimates by the International Monetary Fund (IMF) in April 2020 predicted that GDP would instead contract 4.7 percent.
In the World Bank’s 2020 Doing Business Report, Dominica ranked 111th out of 190 countries, compared to 103rd the previous year. Over the past three years, Dominica made paying taxes less costly by reducing the corporate income tax rate. However, the 2019 report noted that transferring property became a slower process.
Dominica continues to recover from the devastation caused by Hurricane Maria in 2017. Losses from Hurricane Maria are estimated at $1.37 billion or 226 percent of GDP. The government continues to be focused on reconstruction efforts, with support from the international community. The government is seeking to stimulate sustainable and climate-resilient economic growth through a revised macroeconomic framework that includes strengthening the nation’s fiscal framework. The government states it is committed to creating a vibrant business climate to attract more foreign investment.
Dominica remains an emerging market in the Eastern Caribbean (EC), with investment opportunities mainly within the service sector, particularly in eco-tourism; information and communication technologies; and education. Other opportunities exist in alternative energy, including geothermal energy, and capital works due to reconstruction and new tourism projects.
Recently, the government instituted a number of investment incentives. Foreign investors in Dominica can repatriate all profits and dividends and can import capital.
Dominica’s legal system is based on British common law. It does not have a bilateral investment treaty with the United States, but has bilateral investment treaties with the UK and Germany.
In June 2018, the government of Dominica signed an Intergovernmental Agreement to implement the U.S. Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in Dominica to report the banking information of U.S. citizens.
1. Openness To, and Restrictions Upon, Foreign Investment
Policies Towards Foreign Direct Investment
The government of Dominica strongly encourages foreign direct investment (FDI), particularly in industries that create jobs, earn foreign currency, and have a positive impact on local citizens.
Through the Invest Dominica Authority (IDA), the government instituted a number of investment incentives for businesses considering locating in Dominica. Government policies provide liberal tax holidays, duty-free import of equipment and materials, exemption from value added tax on some capital investments, and withholding tax exemptions on dividends, interest payments, and some external payments and income. The IDA additionally provides support to approved citizenship by investment (CBI) projects.
The government has prioritized investment in certain sectors, such as hotel accommodation, including eco-lodges and boutique hotels, nature and adventure tourism services, marina and yachting sector development, fine dining restaurants, and information and technology services, particularly business processing operations. Other sectors include film, music, and video production, agro-processing, manufacturing, bulk water export and bottled water operations, medical and nursing schools, health and wellness tourism, geothermal and biomass industries, biodiversity, aquaculture, and English language training services. The government has signaled that it is also willing to consider additional sectors.
Limits on Foreign Control and Right to Private Ownership and Establishment
There are no limits on foreign control in Dominica. Foreign investment in Dominica is not subject to any restrictions, and foreign investors are entitled to receive the same treatment as nationals of Dominica. Foreign investors are entitled to hold up to 100 percent of their investment. The only restriction is the requirement to obtain an Alien Landholders License for foreign investors seeking to purchase property for residential or commercial purposes. Local enterprises generally welcome joint ventures with foreign investors in order to access technology, expertise, markets, and capital.
Other Investment Policy Reviews
The OECS, of which Dominica is a member, has not conducted a trade policy review since 2014.
Business Facilitation
The IDA is Dominica’s main business facilitation unit. It facilitates FDI into priority sectors and advises the government on the formation and implementation of policies and programs to attract investment in Dominica. The IDA provides business support services and market intelligence to all investors. It offers an online tool useful for navigating laws, rules, procedures, and registration requirements for foreign investors. Its website is http://investdominica.com.
All potential investors applying for government incentives must submit their proposals for review by the IDA to ensure the project is consistent with the national interest and provides economic benefits to the country.
The Companies and Intellectual Property Office (CIPO) maintains an e-filing portal for most of its services, including company registration on its website. However, this only allows for the preliminary processing of applications prior to the investor physically making a payment at the Supreme Court office. Investors are advised to seek the advice of a local attorney prior to starting the process. Further information is available at http://www.cipo.gov.dm.
According to the World Bank’s Doing Business Report for 2020, Dominica ranks 71st out of 190 countries in the ease of starting a business. It takes five procedures and about 12 days to complete the process. The general practice is to retain an attorney who prepares all the relevant incorporation documents. A business must register with CIPO, the Tax Authority, and the Social Services Institute.
The government of Dominica continues to support the growth of women-led businesses. The government supports equitable treatment and support of women in the private sector through non-discriminatory processes for business registration, fiscal incentives, investment opportunities, and quality assessments.
Outward Investment
There is no restriction on domestic investors seeking to do business abroad. Local companies in Dominica are actively encouraged to take advantage of export opportunities specifically related to the country’s membership in the OECS Economic Union and the Caribbean Community Single Market and Economy (CSME), which enhance the competitiveness of the local and regional private sectors across traditional and emerging high-potential markets.
13. Foreign Direct Investment and Foreign Portfolio Investment Statistics
Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source*
USG or international statistical source
USG or International Source of Data:
BEA; IMF; Eurostat; UNCTAD, Other
Economic Data
Year
Amount
Year
Amount
Host Country Gross Domestic Product (GDP) ($M USD)
Table 3: Sources and Destination of FDI Data not available.
Table 4: Sources of Portfolio Investment Data not available.
Grenada
Executive Summary
Grenada’s legal framework for business is strong. The country is a parliamentary democracy, has a functioning court system, relatively low crime rates, and no political violence. A comprehensive investment incentive regime, stable economy, existing trade agreements, and responsive investment promotion experts contribute to Grenada’s healthy and attractive investment climate.
Preliminary data for the first half of 2019 indicated that the economy was poised to experience its seventh consecutive year of growth, estimated at 3.2 percent. Growth in 2019 was fueled by activities in the tourism, education and transportation sectors, in addition to relatively strong performances in the retail and manufacturing sector. Before the COVID-19 crisis, analysts anticipated that Grenada’s 2020 growth rate would be above the projected 3.6 percent average for the members of the Eastern Caribbean Currency Union (ECCU). Grenada’s fiscal position was strong, with a projected primary surplus after grants of 6.8 percent of GDP at the end of 2019. The country’s debt to GDP ratio continued its downward trajectory, moving from 62.7 percent at the end of 2018 to an estimated 55.8 percent of GDP at the end of 2019. The unemployment rate is approximately 15.2 percent, down from 40 percent in 2013, and average inflation as measured by the Consumer Price Index remains at 1 percent. However, the economic impact of COVID-19 is expected to increase unemployment in the short- to medium-term.
Grenada has experienced a wave of foreign direct investment (FDI), primarily within the tourism sector and through Grenada’s citizenship by investment (CBI) program. The Grenada Investment Development Corporation (GIDC) approves over 90 percent of applications for investment incentives. According to the GIDC, Grenada receives an average of $100 million per year in foreign direct investment and $20 million per year in domestic investment.
In 2019, hotels were upgraded and new resorts established. The Royalton Grenada opened in March 2020. This growth in Grenada’s room stock is intended to facilitate and promote increased stay-over and cruise passenger arrivals.
The recent discovery of natural gas within Grenadian waters and the government’s interest in exploring renewables is a very important development within the energy sector. This discovery opens a new and viable area for investment in gas production and export. Climate resilience initiatives and the blue economy are also areas ripe for investment. Other international investments include projects in construction, retail, duty-free outlets, and agriculture.
The Grenada parliament made legislative revisions to value added tax, property transfer tax, investment, excise tax, customs (service charge), and bankruptcy and insolvency acts. The government also launched an innovative Investment Incentives Regime intended to streamline bureaucratic and legal processes. This new regime promotes transparency, equitable practices, and adherence to the rule of law, thus bolstering Grenada’s marketability as an investor-friendly location.
1. Openness To, and Restrictions Upon, Foreign Investment
Policies Towards Foreign Direct Investment
Grenada employs a liberal approach to FDI. The strategic agenda of the government states that investment is directly related to the socio-economic growth and development of the country. As a result, the government of Grenada identified additional foreign investment opportunities related to the country’s resource endowment of “sand, sun, sea and rich fertile soil.” The government of Grenada identified the following 5 priority sectors for investment:
Tourism and hospitality services
Education and health services
Information and communication technology
Agribusiness
Energy development
The GIDC is the country’s investment promotion agency. It is comprised of three strategic business units responsible for carrying out its core responsibilities. They are:
Investment Promotion Agency: responsible for investment promotion facilitation;
Business Development Centre: provides business support services to micro-, small and medium-sized enterprises; and,
Facilities: manages the three business parks owned by the GIDC.
The GIDC is a “one-stop shop” offering:
Investment and trade information
Investment incentives
Investment facilitation and aftercare
Entrepreneurial/business skills training
Small business support services
Industrial facilities
Policy advice
Limits on Foreign Control and Right to Private Ownership and Establishment
There are no economic and industrial strategies that discriminate against foreign investors. Non-Grenadian investors may be required to obtain an Alien Landholding License and pay a property transfer tax, which levies a 10 percent fee on the purchase of shares in a Grenadian registered company or real estate asset. In addition, the sale of shares or real estate to non-nationals attracts a property transfer tax of 15 percent payable by the seller. Foreign investors employed in Grenada are required to obtain a work permit, renewable annually. U.S. investors must pay a fee of $1,111 (3,000 Eastern Caribbean dollars) for work permits. The renewal fee varies based on the investor’s country of citizenship.
There are no limits on foreign ownership or control. Foreign investors may not invest in or operate investment enterprises that are prejudicial to national security or detrimental to the environment, public health, or national culture, or which contravene the laws of Grenada. Grenada has accepted but not yet implemented regional obligations on anti-competition concerns. U.S. investors are not disadvantaged or singled out by any of the ownership or control mechanisms, sector restrictions, or investment screening mechanisms in Grenada relative to other foreign investors.
Grenada maintains an investment screening and approval process for inbound foreign investment for national security concerns.
Other Investment Policy Reviews
Grenada passed its most recent Investment Promotion Act in 2014. The legislation promotes, encourages, and protects investment in Grenada by providing investors with a stable framework of fundamental and enforceable rights. It seeks to guarantee and ensure security and fairness in strict accordance with the rule of law and best international standards and practices. The 2014 Act complies with WTO regulations, the Economic Partnership Agreement (EPA) between the EU and the Caribbean Community (CARICOM), and the Agreement between the Caribbean Forum (CARIFORUM) and the EU.
In 2016, parliament approved a new incentives regime, ensuring all tax exemptions are codified in the relevant legislation. It also restricted discretionary exemptions and required that the beneficiaries of exemptions file appropriate tax returns and comply with tax requirements.
The incentive regime created a streamlined, simple, and non-discretionary system/process for the granting of incentives. The Customs and Inland Revenue Departments administer exemptions through a clearly defined rule-based system.
Incentives will be granted to projects within the priority sectors for investment. They are tourism; manufacturing; agriculture and agribusiness; information technology services; telecommunication providers and business process outsourcing operations; education and training; health and wellness; creative industries; energy; and research and development. Other sectors also include student accommodation; heavy equipment operators; investment projects above particular investment thresholds; and projects within specific geographical locations.
The incentive regime seeks to provide investment incentives on a performance basis (i.e. the more one invests, the more incentives one can receive). Therefore, based on the level of investment, different levels of incentives will be granted in a transparent, open, predictable, and non-discriminatory manner.
In the past three years, the government did not undergo any third-party investment policy reviews through multilateral organizations such as the Organization for Economic Cooperation and Development (OECD), the World Trade Organization (WTO), and the United Nations Conference on Trade and Development.
Business Facilitation
Political and economic stability, human resource capacity, supportive government policies, trade and investment opportunities, quality of life, and good infrastructure provide a positive environment for FDI in Grenada.
An investor must register a business name and identify whether it is a partnership or limited liability company. A registered business can be wholly owned or a joint venture. The official website of the GIDC includes an investor’s guide that details the procedures for starting and operating a business in Grenada. The guide has a business procedure flow chart and gives step-by-step instructions for various tasks from registering a business and owning properties to obtaining permits and licenses. Detailed information on business registration and timelines can be found at: http://grenadaidc.com/investor-centre/investors-guide/starting-up-a-business/#.WKxXdfnQe70
The GIDC provides business facilitation mechanisms and ensures the equitable treatment of women and underrepresented minorities in the economy.
Outward Investment
The government of Grenada does not promote or incentivize outward investment. However, under the Revised Treaty of Chagaramus, there are Rights of Establishment in any CARICOM member state. There is also a chapter on service agreements under the EPA. Under certain circumstances, provisions in these agreements may offer incentives to the potential investor. Grenada does not restrict domestic investors from investing abroad.
2. Bilateral Investment Agreements and Taxation Treaties
Bilateral Investment Agreements established between Grenada and several countries are designed to encourage and protect international investments and to ensure that investors receive fair, equitable, and nondiscriminatory treatment. Bilateral Investment Treaties exist between Grenada and the United States as well as Grenada and the UK.
Grenada is a member of CARICOM, established by the Treaty of Chagaramus in 1973 to promote economic integration and development among its 15 member states. The Revised Treaty of Chagaramus later established the CARICOM Single Market and Economy (CSME) to provide for the free movement of goods, services, capital, and labor within member states.
Grenada is also a member of CARIFORUM and party to the EPA between the EU and CARICOM member states. This agreement aims to alleviate poverty, foster regional integration, promote economic cooperation, and propel CARIFORUM states’ entry into the world economy by creating an attractive investment climate and ensuring trade viability on the world market.
Grenada is also a member of the Caribbean-Canada Trade Agreement (CARIBCAN), an agreement between the Canadian government and the Commonwealth Caribbean nations to promote trade, investment, and industrial cooperation. Treaties with investment provisions also exist through the CARICOM-Costa Rica free trade agreement (FTA), CARICOM-Cuba Cooperation Agreement, CARICOM-Dominican Republic FTA and CARICOM-Venezuela FTA. Grenada, under the umbrella of CARICOM, is reviewing trade agreements with Cuba and the Dominican Republic to negotiate new market access and opportunities.
There is also an agreement with the Caribbean Basin Initiative (CBI), an initiative created by the United States with the Caribbean and Central America to provide several trade and tariff benefits, among others.
In 2018, Grenada signed a bilateral Open Skies Agreement with the United States. This agreement replaces the 1946 Bermuda I Agreement, and ensures a more current, responsive, and beneficial arrangement that is reflective of modern civil aviation trends.
Bilateral Taxation Treaties: Grenada passed legislation that will implement the Foreign Account Tax Compliance Act Inter-Governmental Agreement (FATCA) with the United States. FATCA requires that information on U.S. citizens with accounts at local financial and credit institutions holding in excess of $18,500 (50,000 Eastern Caribbean dollars) be shared with the U.S. Internal Revenue Service (IRS). The legislation provides for the Competent Authority to be the Comptroller of Inland Revenue, who will communicate directly with the IRS. The Comptroller will mandate his/her staff to gather information from financial institutions to be divulged to the IRS. According to the legislation, “failure to comply with such a request is a summary offence punishable by a fine not exceeding $100,000 [Eastern Caribbean dollars].”
The legislation also provides for the protection of privacy, stating that the Competent Authority must protect confidential account information. Other than FATCA, the United States does not have a tax treaty with Grenada.
13. Foreign Direct Investment and Foreign Portfolio Investment Statistics
Host Country Statistical source
USG or international statistical source
USG or International Source of Data: BEA; IMF; Eurostat; UNCTAD, Other
Economic Data
Year
Amount
Year
Amount
Host Country Gross Domestic Product (GDP) ($M USD)
Table 3: Sources and Destination of FDI
Data not available.
Table 4: Sources of Portfolio Investment
Data not available.
Saint Kitts and Nevis
Executive Summary
The Federation of St. Christopher and Nevis (St. Kitts and Nevis) is located toward the top end of the Leeward Islands chain of the Lesser Antilles, near the U.S. Virgin Islands. St. Kitts and Nevis is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU). St. Kitts and Nevis had an estimated gross domestic product of USD 952.1 million in 2019. Prior to the COVID-19 crisis, growth was forecast at 3.2 percent for 2020, according to the Eastern Caribbean Central Bank (ECCB). However, the coronavirus pandemic has reduced the gains that were expected to strengthen St. Kitts and Nevis’s economic position in the near term. The impact of the pandemic on tourism, a mainstay of St. Kitts and Nevis’s economy that generates over 60 percent of GDP, has had ripple effects across the economy. Preliminary estimates by the International Monetary Fund (IMF) in April 2020 predicted that GDP would instead contract by 8.1 percent.
St. Kitts and Nevis ranked 139th out of 190 countries in the World Bank’s 2020 Doing Business Report. The report noted little change in key areas from the previous year.
During the last fiscal year, the economy of St. Kitts and Nevis remained buoyant, fueled by revenue from its citizenship by investment (CBI) program, a robust construction sector, and increased tourist arrivals. Manufacturing exports grew 169 percent and agricultural output grew 37.5 percent over 2018 levels. St. Kitts and Nevis has reduced its debt to GDP ratio to 44.6 percent, surpassing a target set by the Monetary Council of the ECCB in 2017. The government states it is committed to creating an enhanced business climate to attract more foreign investment.
In 2019, St. Kitts inaugurated its second cruise pier, increasing ship docking capacity. Multiple resorts and hotels prepared to open in 2020, including the Hilton’s KOI Resort Saint Kitts, Ramada Hotel, T-Loft at Wyndham, and Sea View Hotel. St. Kitts and Nevis anticipated these investments would facilitate and promote increased stay-over and cruise passenger arrivals. However, the global impact of the coronavirus pandemic on the tourism and cruise industries may reduce the expected positive impact of these projects.
St. Kitts and Nevis has identified priority sectors for investment. These include financial services, tourism, real estate, agriculture, information technology, education services, renewable energy, and limited light manufacturing.
The government provides a number of investment incentives for businesses that are considering establishing operations in St. Kitts or Nevis, encouraging both domestic and foreign private investment. Foreign investors can repatriate all profits, dividends, and import capital.
The country’s legal system is based on British common law. It does not have a bilateral investment treaty with the United States. It has a Double Taxation Agreement with the United States, although the agreement only addresses social security benefits.
In 2016, St. Kitts and Nevis signed an Intergovernmental Agreement in observance of the U.S. Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in St. Kitts and Nevis to report banking information of U.S. citizens.
Table 1: Key Metrics and Rankings
Measure
Year
Index/Rank
Website Address
Transparency InternationalCorruptionPerceptions Index
1. Openness To, and Restrictions Upon, Foreign Investment
Policies Towards Foreign Direct Investment
The government of St. Kitts and Nevis strongly encourages foreign direct investment (FDI), particularly in industries that create jobs, earn foreign currency, and have a positive impact on its citizens.
The country is home to the ECCB, the Eastern Caribbean Securities Exchange (ECSE), and the Eastern Caribbean Securities Regulatory Commission (ECSRC).
Through the St. Kitts Investment Promotion Agency (SKIPA), the government introduced a number of investment incentives for businesses that consider locating in St. Kitts and Nevis. SKIPA provides “one-stop shop” facilitation services to investors, helping to guide them through the various stages of the investment process. Government policies provide liberal tax holidays, duty-free import of equipment and materials, and subsidies for training local personnel.
The St. Kitts and Nevis government encourages investment in all sectors, but targeted sectors include financial services, tourism, real estate, agriculture, information and communication technologies, international education services, renewable energy, ship registries, and limited light manufacturing.
Limits on Foreign Control and Right to Private Ownership and Establishment
There are no limits on foreign control in St. Kitts and Nevis. Foreign investors may hold up to 100 percent of an investment. Local enterprises generally welcome joint ventures with foreign investors in order to access technology, expertise, markets, and capital.
Foreign investment in St. Kitts and Nevis is generally not subject to any restrictions, and foreign investors receive national treatment. The only exception to this is the requirement to obtain an Alien Landholders License for foreign investors seeking to purchase property for residential or commercial purposes.
Other Investment Policy Reviews
The OECS, of which St. Kitts and Nevis is a member, has not conducted a trade policy review in the last three years.
Business Facilitation
Established in 2007, SKIPA facilitates domestic and foreign direct investment in priority sectors and advises the government on the formation and implementation of policies and programs to attract investment to St. Kitts and Nevis. SKIPA provides business support services and market intelligence to investors.
St. Kitts and Nevis ranks 109th of 190 countries in starting a business, which takes seven procedures and about 18.5 days to complete, according to the World Bank’s 2020 Doing Business Report. It is not mandatory that an attorney prepare relevant incorporation documents. A business must register with the Financial Services Regulatory Commission, the Registrar of Companies, the Ministry of Finance, the Inland Revenue Department, and the Social Security Board.
The government of St. Kitts and Nevis supports the growth of women–led businesses. The government encourages equitable treatment and support of women in the private sector through non-discriminatory processes for business registration, fiscal incentives, investment opportunities, and quality assessments. In 2019, the Nevis Island Administration (NIA) established a loan program open to women of all ages and men under 35 that gives concessional loans of up to USD 37,000 (100,000 Eastern Caribbean dollars).
Outward Investment
There is no restriction on domestic investors seeking to do business abroad. Local companies in St. Kitts and Nevis are actively encouraged to take advantage of export opportunities specifically related to the country’s membership in the OECS Economic Union and the Caribbean Community Single Market and Economy (CSME), which enhance the competitiveness of the local and regional private sectors across traditional and emerging high-potential markets.
13. Foreign Direct Investment and Foreign Portfolio Investment Statistics
Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source*
U.S. Government or international statistical source
St. Lucia is located in the Lesser Antilles in the Eastern Caribbean (EC). St. Lucia is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU). In 2018, the country had an estimated Gross Domestic Product (GDP) of USD 1.33 billion, with a growth of 1.50 percent in 2019. Prior to the COVID-19 crisis, growth was forecasted at 3.78 percent for 2020, according to the Eastern Caribbean Central Bank (ECCB). However, the coronavirus pandemic has significantly reduced the gains that were expected to strengthen St. Lucia’s economic position in the near term. The impact of the pandemic on tourism has had ripple effects across the economy. Preliminary estimates by the International Monetary Fund (IMF) in April 2020 predicted that GDP would instead contract 8.5 percent. There has been a slight decline in the country’s debt to GDP ratio over the past three years, from 65.45 percent in 2016 to 64.28 percent in 2018. Inflation remains relatively stable at 1.55 percent. Public sector outstanding debt in 2018 was estimated at USD 1.2 million (3,342,730 million Eastern Caribbean dollars), and is expected to increase in 2020 due to government borrowing to finance pandemic response and recovery efforts.
In the 2020 World Bank’s Doing Business Report, St. Lucia ranked 93rd out of 190 countries. The report noted minimal changes from the previous report, but some improvement in the ease of starting a business.
St. Lucia attracts foreign business and investment, especially in its offshore banking and tourism industries. According to the World Travel and Tourism Council, in 2019 tourism was St. Lucia’s main economic sector, accounting for about 40 percent of GDP and formal employment. Real estate and transport are other leading sectors. The government has stated it is committed to creating a welcoming and open business climate to attract more foreign investment. Investment opportunities are focused primarily in tourism and hotel development, information and communication technology, manufacturing, international financial services, agribusiness, and creative industries.
The government of St. Lucia provides several investment incentives to encourage domestic and foreign private investment. Recent amendments to the International Business Act sought to encourage businesses to locate their head offices in St. Lucia. Foreign investors in St. Lucia can repatriate all profits, dividends, and import capital.
The St. Lucia legal system is based on the British common law system, but its civil code and property law are greatly influenced by French law. St. Lucia does not have a bilateral investment treaty with the United States but has bilateral investment treaties with the United Kingdom and Germany.
In 2014, the government of St. Lucia signed an Intergovernmental Agreement in observance of the U.S. Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in St. Lucia to report the banking information of U.S. citizens.
Table 1: Key Metrics and Rankings
Measure
Year
Index/Rank
Website Address
Transparency International Corruption Perceptions Index
1. Openness To, and Restrictions Upon, Foreign Investment
Policies Towards Foreign Direct Investment
The government of St. Lucia strongly encourages foreign direct investment (FDI). Through Invest Saint Lucia, the government introduced several investment incentives for businesses that consider locating in St. Lucia, encouraging both domestic and foreign private investment. Invest Saint Lucia provides “one-stop shop” facilitation services to investors, helping to guide them through the various stages of the investment process.
Applicable government agencies, rather than Invest Saint Lucia, grant investment concessions. Invest Saint Lucia is overseen by the Minister in the Office of the Prime Minister with responsibility for Commerce, International Trade, Investment, Enterprise Development and Consumer Affairs. Government policies provide liberal tax holidays, a waiver of import duty on imported plant machinery and equipment and imported raw and packaging materials, and export allowance or tax relief on export earnings. Various laws provide fiscal incentives to encourage establishing and expanding foreign and domestic investment. Invest Saint Lucia also provides investment promotion services.
The St. Lucian government encourages investment in all sectors, but targeted sectors include tourism, smart manufacturing and infrastructure, information and communication technologies, alternative energy, education, and business/knowledge processing operations.
Limits on Foreign Control and Right to Private Ownership and Establishment
There is no limit on the amount of foreign ownership or control in the establishment of a business in St. Lucia. The government allows 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. However, Invest Saint Lucia assesses investment proposals for viability and in accordance with the laws of St. Lucia. Trade licenses and other approvals/licenses may be required before establishment.
Invest Saint Lucia evaluates all FDI proposals and provides intelligence, business facilitation, and investment promotion to establish and expand profitable business enterprises in St. Lucia. Invest Saint Lucia also advises the government on issues that are important to the private sector and potential investors and advocates for an improved business climate, growth in investment opportunities, and improvements in the international competitiveness of the local economy. They focus on building and promoting St. Lucia as an ideal location for investors, seeking and generating new investment in strategic sectors, facilitating domestic and foreign direct investment as a one stop shop for investors, and identifying major issues and measures geared towards assisting the government in the ongoing development of a National Investment Policy.
The government of St. Lucia treats foreign and local investors equally with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.
Other Investment Policy Reviews
St. Lucia, as a member state of the OECS, has not conducted a trade policy review in the last three years.
Business Facilitation
Invest Saint Lucia is the main business facilitation unit for potential investors into St. Lucia. It facilitates FDI in priority sectors and advises the government on the formation and implementation of policies and programs to attract investment. Invest Saint Lucia provides business support services and market intelligence to all investors. All potential investors applying for government incentives must submit their proposals for review by Invest Saint Lucia to ensure the projects are consistent with the national interest and provide economic benefits to the country. Invest Saint Lucia offers an online resource that is useful for navigating the laws, rules, procedures and registration requirements for foreign investors. It is available at http://www.investstlucia.com/.
The Registry of Companies and Intellectual Property office maintains an e-filing portal for most of its services, including company registration. Relevant officials can review applications submitted electronically. However, applicants must pay the registration fee at the Registry office. The Registry of Companies and Intellectual Property office can only accept payment in the form of cash and checks. Personal checks are not accepted. It is advisable to consult a local attorney prior to starting the process. Further information is available at http://www.rocip.gov.lc.
According to the World Bank Doing Business Report for 2020, St. Lucia ranked 69 out of 190 countries in the ease of starting a business. The general practice for starting a business is to retain an attorney to prepare all incorporation documents. A business must register with the Registry of Companies and Intellectual Property Office, the Inland Revenue Authority, and the National Insurance Corporation. The government of St. Lucia continues to support the growth of women–led businesses. The government seeks to support equitable treatment of women in the private sector through non-discriminatory processes for business registration, awarding of fiscal incentives, and assessing investments.
In 2018, the government of St. Lucia embarked on a disability assessment, funded by the Caribbean Development Bank, to support the full participation of people with disabilities in the society and the economy. Among other objectives, the assessment seeks to provide data about the engagement of people with disabilities in society and to ensure the equal participation of people with disabilities in the formal and informal sectors of the economy.
Outward Investment
The government of St. Lucia prioritizes investment retention as a key component of its overall economic strategy. While the government of St. Lucia is encouraging more domestic savings, it continues to require significant foreign investment to fill the investment gap.
There is no restriction on domestic investors seeking to do business abroad. Local companies in St. Lucia are actively encouraged to take advantage of export opportunities specifically related to the country’s membership in the OECS Economic Union and the Caribbean Community Single Market and Economy (CSME), which enhance the competitiveness of the local and regional private sectors across traditional and emerging high-potential markets.
13. Foreign Direct Investment and Foreign Portfolio Investment Statistics
Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source*
U.S. Government or international statistical source
Table 3: Sources and Destination of FDI
Data not available.
Table 4: Sources of Portfolio Investment
Data not available.
Saint Vincent and the Grenadines
Executive Summary
St. Vincent and the Grenadines is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU). According to Eastern Caribbean Central Bank (ECCB) statistics as of December 2019, St. Vincent and the Grenadines had an estimated gross domestic product (GDP) of USD 825 million in 2019, with forecast growth of 3.4 percent in 2020. However, the coronavirus pandemic is expected to have far-reaching consequences, notably negative near-term economic growth. The government has announced an economic recovery and stimulus package.
The country seeks to diversify its economy across several niche markets, particularly tourism, international financial services, agroprocessing, light manufacturing, renewable energy, creative industries, and information and communication technologies. St. Vincent and the Grenadines ranks 130th out of 190 countries in the 2020 World Bank’s Doing Business report.
The government of St. Vincent and the Grenadines strongly encourages foreign direct investment (FDI), particularly in industries that create jobs and earn foreign exchange. Through the Invest St. Vincent and the Grenadines Authority (Invest SVG), the government facilitates FDI and maintains an open dialogue with current and potential investors.
The government does not impose limits on foreign control, nor are there requirements for local involvement or ownership in locally registered companies. The islands’ legal system is based on the British common law system.
St. Vincent and the Grenadines does not have a bilateral investment treaty with the United States. However, it does have double taxation treaties with the United States, Canada, the UK, Denmark, Norway, Sweden, and Switzerland.
In 2016, St. Vincent and the Grenadines signed an intergovernmental agreement in observance of the United States’ Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in St. Vincent and the Grenadines to report the banking information of U.S. citizens.
Table 1: Key Metrics and Rankings
Measure
Year
Index/Rank
Website Address
Transparency International Corruption Perceptions Index
1. Openness To, and Restrictions Upon, Foreign Investment
Policies Towards Foreign Direct Investment
The government of St. Vincent and the Grenadines, through Invest SVG, strongly encourages FDI, particularly in industries that create jobs and earn foreign currency. St. Vincent and the Grenadines is an emerging and developing investment destination. The government is open to all investment, but is currently prioritizing investment in niche markets, particularly tourism, international financial services, agroprocessing, light manufacturing, creative industries, and information and communication technologies. St. Vincent and the Grenadines benefits from a low inflation rate and growing opportunities in the trade and export sectors.
Invest SVG’s FDI policy is to attract investment into the aforementioned priority sectors. It advises the government on the formation and implementation of policies and programs that attract and facilitate investment. The government offers special incentive packages for foreign investments in the hotel industry and light manufacturing. The government offers other incentive packages on an ad hoc basis.
Limits on Foreign Control and Right to Private Ownership and Establishment
There are no limits on foreign control in St. Vincent and the Grenadines, nor are there requirements for local involvement or ownership in locally registered companies, although non-nationals must apply for a license from the Prime Minister’s Office to acquire more than 50 percent of a company. An attorney must submit the application and Cabinet must approve it. Companies holding at least five acres of land may restrict or prohibit the issue or transfer of their shares or debentures to non-nationals.
The government has not officially closed any industries to private enterprise, although some activities such as telecommunications, utilities, broadcasting, banking, and insurance require a government license.
Other Investment Policy Reviews
The OECS, of which St. Vincent and the Grenadines is a member, has not conducted a trade policy review in the last three years.
Business Facilitation
Established in 2003 under the Companies Act, Invest SVG facilitates domestic and foreign direct investment in priority sectors and advises the government on the formation and implementation of policies and programs to attract investment. Invest SVG provides business support services and market intelligence to all investors. It also reviews all investment projects applying for government incentives to ensure they conform to national interests and provide economic benefits to the country. Invest SVG offers an online resource that is useful for navigating the laws, rules, procedures, and registration requirements for foreign investors. It is available at http://www.investsvg.com.
According to the World Bank’s 2020 Doing Business Report, St. Vincent and the Grenadines ranks 93rd of 190 countries in the ease of starting a business, which takes seven procedures and 10 days to complete. The general practice is to retain an attorney to prepare all incorporation documents. A business must register with the Commerce and Intellectual Property Office (CIPO), the Ministry of Trade, the Inland Revenue Department, and the National Insurance Service. The CIPO has an online information portal that describes the steps to register a business in St. Vincent and the Grenadines. There is no online registration process, but the required forms are available online. These must be printed and submitted to the CIPO. More information is available at http://www.cipo.gov.vc.
Outward Investment
There is no restriction on domestic investors seeking to do business abroad. Local companies are actively encouraged to take advantage of export opportunities specifically related to the country’s membership in the OECS Economic Union and the Caribbean Community Single Market and Economy (CSME), which enhance the competitiveness of the local and regional private sectors across traditional and emerging high-potential markets.
2. Bilateral Investment Agreements and Taxation Treaties
St. Vincent and the Grenadines has not signed a bilateral investment treaty with the United States. However, the country does have bilateral tax treaties with the United States, Canada, the UK, Denmark, Norway, Sweden, and Switzerland. In 1989, Germany and St. Vincent and the Grenadines signed a treaty for the Encouragement and Reciprocal Protection of Investment. In 2018, St. Vincent and the Grenadines and the United Arab Emirates concluded an Agreement on the Avoidance of Double Taxation on Income and an Agreement for the Promotion and Protection of Investments. St. Vincent and the Grenadines is also party to the following economic communities and organizations:
Caribbean Community
The Treaty of Chaguaramas established the Caribbean Community (CARICOM) in 1973. Its purpose is to promote economic integration among its 15 member states. Investors operating in St. Vincent and the Grenadines have preferential access to the entire CARICOM market. The Revised Treaty of Chaguaramas goes further, establishing the CSME and permitting the free movement of goods, capital, and labor within CARICOM states.
Organization of Eastern Caribbean States
The Revised Treaty of Basseterre establishes the Organization of Eastern Caribbean States (OECS). The OECS consists of seven full member states (Antigua and Barbuda, Dominica, Grenada, Montserrat, St. Kitts and Nevis, St. Lucia, and St. Vincent and the Grenadines), and three associate members (Anguilla, Martinique, and the British Virgin Islands). Guadeloupe signed an accession agreement with the OECS in March 2019. The purpose of the Treaty is to promote harmonization among member states in foreign policy, defense and security, and economic affairs. The six independent countries and Montserrat ratified the Revised Treaty of Basseterre establishing the OECS Economic Union, which entered into force in 2011. The Economic Union established a single financial and economic space within which all factors of production, including goods, services, and people, move without hindrance.
CARIFORUM-EU Economic Partnership Agreement
The Caribbean Forum of the African, Caribbean and Pacific Group of States (CARIFORUM) and the European Community signed an Economic Partnership Agreement (EPA) in 2008. The overarching objectives of the EPA are to alleviate poverty in CARIFORUM states, to promote regional integration and economic cooperation, and to foster the gradual integration of CARIFORUM states into the world economy by improving their trade capacity and creating investment-conducive environments. The Agreement promotes trade-related developments in areas such as competition, intellectual property, public procurement, the environment, and protection of personal data.
Caribbean Basin Initiative
The objective of the Caribbean Basin Initiative is to promote economic development through private sector initiatives in Central America and the Caribbean islands by expanding foreign and domestic investment in non-traditional sectors, diversifying country economies, and expanding their exports. It permits duty-free entry of products manufactured or assembled in St. Vincent and the Grenadines into U.S. markets.
Caribbean/Canada Trade Agreement
Caribbean/Canada Trade Agreement (CARIBCAN) is an economic and trade development assistance program for Commonwealth Caribbean countries in which Canada provides most products originating in Commonwealth Caribbean countries with duty-free access to its national market.
13. Foreign Direct Investment and Foreign Portfolio Investment Statistics
Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy