Policies Towards Foreign Direct Investment

Grenada employs a liberal approach to foreign direct investment (FDI) and actively promotes foreign investment into the country.

The government of Grenada identified five priority sectors for investment:

• Tourism and hospitality services
• Education and health services
• Information and communication technology
• Agribusiness
• Energy development

The Grenada Investment Development Corporation (GIDC) is the country’s investment promotion agency. It was established in 1985 to stimulate, facilitate, and encourage the creation and development of industry.

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

To promote FDI, the GIDC adopts a targeted approach to promote investment opportunities, provides investor facilitation and entrepreneurial development services, and advocates for a supportive environment for investors to develop and grow businesses, trade, and industries.

Investment retention is a priority in Grenada and is maintained through ongoing dialogue with investors facilitated by the GIDC.

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. In addition, the sale of such shares or real estate to non-nationals will attract a property transfer tax of 15 percent payable by the seller if the seller is a non-Grenadian. Foreign investors employed in Grenada are required to obtain a work permit, renewable annually. U.S. investors must pay a fee of USD $1,111 or XCD $3,000 for work permits. The renewal fee varies based on the investor’s country of citizenship.

There are no limits on foreign ownership or control, except for enterprises deemed prejudicial to national security, the environment, public health, or national culture, or which contravene the laws of Grenada. Grenada has accepted but not yet implemented regional anti-competition obligations. 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.

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 is also in compliance 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.

The incentives regime enacted in 2016 grants incentives to ensure that all new tax exemptions are codified, restricts discretionary exemptions, and requires that the beneficiaries of exemptions file appropriate tax returns and comply with tax requirements. It also sets streamlined, simple, and non-discretionary system/process for the granting of incentives. The Customs and Inland Revenue Departments (CIRD) administer exemptions through a clearly defined rule-based system in contrast with past incentive schemes that required each case to be approved at the cabinet level.

Under this regime, the CIRD grants incentives 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, CIRD grants different levels of incentives in a transparent, predictable, and non-discriminatory manner.

In the past three years, the government was not subject to third-party investment policy reviews through multilateral organizations such as the Organization for Economic Cooperation and Development (OECD), the WTO, and the UN Conference on Trade and Development.

Business Facilitation

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. The Revised Treaty of Chaguaramas, to which Grenada is a party, includes a chapter on service agreements under the European Partnership Agreement (EPA). Under certain circumstances, provisions in these agreements may offer incentives to the potential investor. Grenada does not restrict domestic investors from investing abroad.

A. Bilateral Investment Treaties: Bilateral Investment Treaties 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 the Caribbean Community (CARICOM), established by the Treaty of Chaguaramas in 1973 to promote economic integration and development among its 15 member states. The Revised Treaty of Chaguaramas 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.

The Caribbean Basin Initiative (CBI), an initiative created by the United States with the Caribbean and Central America, also provides trade and tariff benefits.

Grenada, under the umbrella of CARICOM, is reviewing trade agreements with Cuba and the Dominican Republic to negotiate new market access and opportunities.

In 2018, Grenada signed a bilateral Open Skies Agreement with the United States. It is intended to liberalize the aviation market, remove various restrictions, increase capacity and number of routes, and improve the ease of travel to and from Grenada.

B. Bilateral Taxation Treaties: Grenada passed legislation to 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 more than XCD $50,000, approximately USD $18,518 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 communicates directly with the IRS. The Comptroller mandates 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 [XCD] $100,000.”

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.

Transparency of the Regulatory System

Grenada recognizes that investors value transparent rules and regulations dealing with investment.

The Investment Act and the investment promotion regime promote transparency by authorizing investment incentives to key sectors through the GIDC. This helps to streamline processes, standardize treatment of investors, and better define investment rights. It also provides procedural guarantees and reduces the possibility for political influence in business negotiation.

Grenada also seeks to promote investment by consulting with interested parties, simplifying and codifying legislation, using plain language drafting, developing registers of existing and proposed regulation, expanding electronic dissemination of regulatory material, and publishing and reviewing administrative decisions.

Tax, labor, environment, health and safety, and other laws or policies do not distort or impede investment. In theory, bureaucratic procedures, including those for licenses and permits, are sufficiently streamlined and transparent. In practice, local authorities recognize that the implementation of procedures can sometimes be slow and inefficient.

Legal, regulatory, and accounting systems are generally transparent and consistent with international norms. Public finances and debt obligations, including explicit and contingent liabilities, are also transparent and in keeping with international requirements.

No new regulatory systems and enforcement reforms have been announced since the last ICS report.

International Regulatory Considerations

Grenada has been a member of the WTO since 1996 and is a party to agreements established under the organization. In pursuit of WTO compliance, Grenada is in the process of negotiating trade and investment agreements that contain provisions better aligned with the provisions of the WTO. Grenada is a member of CARICOM and the CARICOM Single Market Economy (CSME), which adheres to the international norms and regulatory standards outlined by the WTO. Also, in keeping with WTO regulations the government notifies all draft technical regulations to the WTO Committee on Technical Barriers to Trade.

Legal System and Judicial Independence

The Prime Minister and the cabinet have the executive authority to negotiate and sign international agreements and conventions with other states and international organizations.

Grenada’s judicial system is based on English common law. The judiciary has four levels: The Magistrates Court, the High Court, the Eastern Caribbean Supreme Court, and the UK-based Privy Council.

The Magistrates Court primarily handles minor civil and criminal cases, while the High Court adjudicates cases under the purview of the Acts of Parliament. Appeals from the Magistrates Court are heard by the High Court, while appeals from the High Court are heard by the Eastern Caribbean Supreme Court. The Eastern Caribbean Supreme Court is comprised of the Chief Justice, who serves as the Head of the Judiciary; four Justices of Appeal; nineteen High Court Judges; and three Masters, who are primarily responsible for procedural and interlocutory matters. The Court of Appeal judges are based at the Court’s headquarters in Saint Lucia.

The Privy Council serves as Grenada’s final Court of Appeal. However, the Caribbean Court of Justice (CCJ) has compulsory and exclusive jurisdiction under Section 211 of the Revised Treaty of Chaguaramas, to which Grenada is a party. The Treaty delineates rights and responsibilities within CARICOM to hear and decide disputes concerning the interpretation and application of the Treaty.

The judicial system remains independent of the executive branch, and judicial processes are generally competent, fair, and reliable, however the process can be slow. Provisions are also made for appeals with the relevant court. Grenadian law also provides for the use of arbitration and mediation to resolve investment disputes.

Laws and Regulations on Foreign Direct Investment

The economy is supported by a strong legislative and regulatory framework that encourages FDI and promotes investment initiatives. Grenada augmented the investment climate with a revitalization of its Citizenship by Investment (CBI) program.

In 2016 parliament passed several legislative changes to enhance the investment climate in Grenada. Changes were made to the following Acts:

• Value Added Tax Amendment Act – Provides for VAT exemptions for qualifying investments in priority sectors.
• Excise Tax Amendment Act – Provides for tax incentives for investors engaged in manufacturing and investors entitled to conditional duties exemptions for motor vehicles.
• Property Transfer Tax Amendment Act – Establishes more favourable rates of property transfer tax for investors.
• Customs Service Charge Amendment Act – Removes the discretionary power of cabinet to prescribe varying rates of customs service charge (CSC) and to prescribe a new rate of CSC applicable to investors engaged in manufacturing.
• Investment Amendment Act – Provides for specified circumstances under which the Minister of Finance may make regulations under the Principal Act.
• Bankruptcy and Insolvency Amendment Act – Modernized the law relating to bankruptcy and insolvency of individuals and companies. The act is based on the Canadian Bankruptcy and Insolvency Act, which has been used as a model in several Caribbean countries.
• Income Tax Amendment Act – Provides for a waiver on withholding tax applicable on specified types of repatriated funds relating to investors engaged in tourism accommodation or health and wellness.

The GIDC and the Inland Revenue and Customs Department of Grenada work to ensure adherence to the rule of law and to facilitate the procedures outlined in the revised investment regime. The legal and regulatory framework governing foreign direct investment in Grenada is described here: http://grenadaidc.com/ 

Competition and Antitrust Laws

There are no competition laws in Grenada. A number of CARICOM and Organization of Eastern Caribbean States (OECS) proposals on competition are under consideration to strengthen market regimes under the CARICOM Single Market and Economy. CARICOM established a Competition Commission and plans are underway to establish a sub-regional Eastern Caribbean Competition Commission.

Expropriation and Compensation

According to the Constitution, Grenada shall not compulsorily acquire or take possession of any investment or any asset of an investor except for a purpose which is legal and non-discriminatory. If the government expropriates property for a legal purpose, it must promptly pay adequate and effective compensation. Owners of expropriated assets have the right to file claims in the High Court regarding the amount of compensation or ownership of the expropriated asset.

In 2016, parliament repealed the 1994 Electricity Supply Act and opened the market to potential investors who will commit to transition to alternative sources of power generation, decreasing costs, reducing dependence on imported fossil fuels, and improving energy efficiency. This repealed the exclusive license that was granted to the country’s sole electricity provider Grenada Electricity Services (GRENLEC) and its majority shareholder, U.S.-owned WRB Enterprises. This regulatory change triggered a clause in the Share Purchase Agreement requiring Grenada to repurchase the GRENLEC shares from WRB. WRB filed a request for arbitration with ICSID, and the Grenada government was ordered to pay $74 million to the U.S. investors following a March 2020 ruling. A negotiated sum of $63 million was paid to WRB Enterprises in December 2020.

In the past, Grenadian citizens had their lands expropriated to permit foreign investments but were compensated for such actions typically at the market value. There are no sectors at greater risk of expropriation, and there are no laws requiring local ownership. All expropriations have been subject to due process.

Dispute Settlement

ICSID Convention and New York Convention

Grenada is a signatory and contracting member of the International Center for Settlement of Investment Disputes and has engaged this platform to resolve past disputes. While Grenadian laws have adapted the provisions outlined in the New York Convention, the country is not a contracting state and has not ratified the convention.

Investor-State Dispute Settlement

There was an investment dispute between the government of Grenada and U.S.-owned WRB Enterprises, which was the majority shareholder in Grenada Electricity Services Ltd. In 2016, parliament repealed the 1994 Electricity Supply Act and opened the market to potential investors, which put an end to WRB’s 80-year exclusive license. This triggered a clause in the share purchase agreement requiring Grenada to repurchase the shares. The case was brought to arbitration before ICSID. On March 19, 2020, ICSID ruled in favor of WRB Enterprises. Grenada was ordered to pay $74 million for the shares, and a negotiated $63 million was paid in December 2020. There is no history of extrajudicial action against foreign investors.

International Commercial Arbitration and Foreign Courts

In the event of an investment dispute between two foreign parties, between a foreign investor(s) and Grenadian parties, between Grenadian partners, or between investors and the government of Grenada, Grenadian law mandates that the parties shall first seek to settle their differences through consultation or mediation. If the parties fail to resolve the matter, they may then submit their dispute to arbitration, file a lawsuit in Grenadian courts, invoke the jurisdiction of the Caribbean Court of Justice, or adopt such other procedures as provided for in the Articles of Association of the investment enterprise.

There is no government interference in the court system. Grenada participates in a court-connected mediation mechanism that can be accessed through the Mediation Centre. This Centre extends court-connected mediation to all member states of the OECS and allows for civil actions filed in court to be referred to mediation. Through this system, parties can utilize alternative dispute resolution mechanisms, including mediation, if the court deems them to be appropriate mechanisms for resolving the case.

Court-connected mediation, however, cannot be used in family proceedings, insolvency, non-contentious probate proceedings, proceedings when the High Court is acting as a prize court, and any other proceeding in the Supreme Court.

Bankruptcy Regulations

Grenada ranked 168 out of 190 for ease of resolving insolvency in the World Bank’s Doing Business Report for 2020, the same ranking it received in 2019.

The Bankruptcy Act makes provisions for all aspects of bankruptcy and sets out procedures for creditors to apply to the High Court for a bankruptcy order against a debtor and the appointment of a trustee in bankruptcy. There are provisions for the court to appoint an interim receiver pending the outcome of the application for a bankruptcy order. It also includes provisions for a process whereby an insolvent person, with leave of the court, may make an assignment of the insolvent person’s property for the general benefit of creditors of the insolvent person.

The High Court exercises exclusive jurisdiction in matters related to bankruptcy.

Investment Incentives

Grenada provides a legal package of benefits and concessions for specific investment activities. Incentives include tax waivers, import duty exemptions, repatriation of profits, and withholding tax exemptions.

Trade-related incentives are notified under Article 25 and Article 27 of the Agreement on Subsidies and Countervailing Measures. Concessions are available under the Income Tax Act, the Common External Tariff (SRO 42/09), the Property Transfer Act, the Petrol Tax Act, and the Customer Service Charge Act.

Fiscal incentives include:

• 100 percent investment allowances up to 15 years
• 50-100 percent property transfer tax waivers
• 50-100 percent withholding tax waivers
• Tax credits of 150 percent for training, research, and development
• Waiver of VAT on importation of capital goods
• Tax exemptions and waiver of duties on building materials

Non-fiscal incentives include:

• Equal treatment of all investors regardless of nationality or residence
• Conversion into freely convertible currency
• No discrimination among foreign investors
• Repatriation of profits allowed

Other incentives include accelerated depreciation (10 percent on physical plant and machinery; 2 percent on industrial buildings); investment allowance (100 percent write-off on total investment); carry forward of losses for three years; reductions in the property transfer tax; and 100 percent relief from customs duties on physical plant, equipment, and raw materials. Certain incentives may be linked to the site of investment, the number of persons employed, or other factors.

There was no instance where Grenada needed to review an approved investor for non-compliance with incentive requirements. Grenada does not have a practice of issuing guarantees or jointly financing foreign direct investment projects.

Foreign Trade Zones/Free Ports/Trade Facilitation

There are no foreign trade zones or free ports in Grenada.

Performance and Data Localization Requirements

CARICOM investors are accorded Rights of Establishment, while other foreign investors are required to obtain work permits and alien landholding licenses to invest in property.

The application fee for a work permit is USD $37/XCD $100 payable to the Work Permit Division of the Ministry of Labor. Along with the completed application form, applicants must also submit four passport-sized photos, a police certificate of character from their country, certificates of qualification, and a letter of intention. In addition, investors will need a character reference from a reputable person/former employer, a copy of the passport page indicating the last date of arrival in Grenada, a business registration certificate, company stamp, National Insurance Scheme compliance certificate, and recent tax compliance and VAT receipts.

The approval process takes two to three weeks, longer if there are questions, and is valid for one year. U.S. investors and workers are required to pay USD $1,111 or XCD $3,000 per year for renewal. The local government does not mandate local employment but encourages it.

There is no policy of “forced localization” of data storage and Grenada does not pressure international information and communications technology providers to provide source code or encryption keys. The OECS and other stakeholders have begun to develop draft model laws on electronic regimes. Laws specific to data storage and protection have not yet made it onto the national legislative agenda.

There are no measures to prevent or impede companies from transmitting customer or business-related data outside the country. There are no performance requirements. Investment incentives are applied uniformly to domestic and foreign investors on a case-by-case basis.

There is no requirement for foreign IT providers to turn over source code and/or provide access to encryption. There are no measures or draft measures that restrict companies from freely transmitting customer or other business-related data outside the economy/country’s territory.

Real Property

The Aliens Landholding Regulation Act No. 29 of 1968 (last amended in 2009) is the primary legislative instrument governing the right to private ownership by non-citizens. Investors may purchase or lease privately owned land and dispose of, or transfer, interests in the land under the Act. Investors may hold state lands by grant or lease from the state.

Property rights and interests are enforced under the Aliens Landholding Regulation Act. The only specific regulation regarding land lease or acquisition by a foreign or non-resident investor is the requirement to acquire an Alien Landholding License. The application process is described on the following website: http://grenadaidc.com/investor-centre/investors-guide/starting-up-a-business/#.WLBEUvnQe70 

Before a deed is issued, there is a title search on the previous owner, followed by conveyance, and the registering of the property to a new owner. A clear title must first be identified before the process moves forward. Once the landholder possesses a deed, the property remains legally theirs, occupied or not, until the deed is signed over to someone else.

Grenada ranked 147 out of 190 for the ease of registering property on the World Bank’s 2020 Doing Business Report.

Intellectual Property Rights

The Patents Act (Cap. 227 of the Consolidated Laws of Grenada) or the Trademarks Act (Cap. 284 of the Consolidated Laws of Grenada), or the Copyright Act Cap. 32 of 1988 (Cap. 67 of the Consolidated Laws of Grenada) guarantees the intellectual property rights of investors and investment enterprises e.g., patents, trademarks, brand names, and copyrighted materials in printed, recorded, or electronic formats. Grenada is a member of the World Intellectual Property Organization (WIPO), the Paris Convention, the Berne Convention, and the Patent Cooperation Treaty.

Domestic legislation regarding intellectual property protection has not been fully amended to bring it in line with the Trade-Related Aspects of Intellectual Property Rights (TRIPs) Agreement. However, updates to existing legislation are currently being drafted and reviewed.

Trademarks

The Trademarks Act of 2012 regulates trademarks.

Patents

The Registration of United Kingdom Patents Act Cap 283 of the Continuous Revised Laws of Grenada is still in force, although outdated. In accordance with the act, any person being the grantee of a patent in the United Kingdom or any person deriving right from such grantee may apply within three years from the date of issue of the patent in in the UK to have it registered in Grenada.

The Patent Act Cap 227 of the Continuous Revised Laws of Grenada is not TRIPS compliant. Implementation of the Patent Act No. 16 of 2011 has been slow due to the lack of implementing regulations, but the government has indicated that this a priority.

Copyright

The Copyright Act No. 21 of 2011 is in force.  In accordance with Berne Convention, there is no existing formal system of registration of copyrighted works. There are current discussions with WIPO, in conjunction with the intellectual property offices in the region, to consider a voluntary system of registration for copyrighted works.

Geographic Indication Bill

The geographic indication bills have been drafted but not yet enacted. The 2012 Trademarks Act provides for registration of collective marks in the absence of a geographic indication act.

Industrial Designs Bill

The Industrial Design Bill is a work in progress. According to the Office of Corporate Affairs, its enactment is a priority in 2021.

Administration of intellectual property laws in Grenada is the responsibility of the Ministry of Legal Affairs. The Corporate Affairs and Intellectual Property Office (CAIPO) is currently responsible for the registration of trademarks, re-registration of UK patents, and all other IP matters.

Post is unaware of any current or past prosecutions of IPR violations. Grenada is not listed in the U.S. Trade Representative’s Special 301 Report or in the 2020 Review of Notorious Markets for Counterfeiting and Piracy,

For additional information about national laws and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/ 

Capital Markets and Portfolio Investment

Grenada possesses a robust legislative and policy framework that facilitates free flow of financial resources. Its currency, the Eastern Caribbean dollar, has a fixed exchange rate established by the regional Eastern Caribbean Central Bank (ECCB). Foreign employees of investment enterprises and their families may repatriate their earnings after paying personal income tax and all other taxes due. The government of Grenada encourages foreign investors to seek investment capital from financial institutions chartered outside Grenada due to the short domestic supply of capital. Foreign investors are more likely to tap local financial markets for working capital. The government, local banks, and the ECCB respect IMF Article VIII by refraining from restrictions on payments and transfers for current international transactions.

The private sector has access to the limited number of credit instruments. Grenadian stocks are traded on the Eastern Caribbean Securities Exchange, whose limited liquidity may pose difficulties in conducting transactions.

Money and Banking System

The financial industry in Grenada is regulated by two entities: The ECCB and the Grenada Authority for Regulation of the Financial Industry (GARFIN). The ECCB regulates the banking system. GARFIN oversees non-banking financial institutions through a regulatory system that encourages and facilitates portfolio investment. The estimated total assets of the largest banks are USD $1.03 billion. Information on the percentage of non-performing assets is not available. Grenada has not experienced cross-shareholding or hostile takeovers. As of November 30, 2020, commercial banks in Grenada deferred debt service on 4,069 commercial bank loans due to job losses and a reduction in salaries caused by the COVID-19 pandemic. This was the second highest number of deferrals in the Eastern Caribbean Currency Union (ECCU).

Foreign banks or branches can establish operations in Grenada subject to prudential measures and regulations governed by the ECCB. For the requirements and procedures, foreign banks can refer to the following website: https://www.eccb-centralbank.org/p/grenada-1 

There is correspondent banking available with all licensed commercial banks. No correspondent banking relationships have been lost in the past three years. There are no restrictions on a foreigner’s ability to establish a bank account.

In addition to the banking sector, there are alternative financial services provided through credit unions. GARFIN regulates credit unions.

Foreign Exchange and Remittances

Foreign Exchange

Grenada’s currency is the Eastern Caribbean dollar issued by the ECCB located in Saint Kitts and Nevis. The exchange rate is also determined by the ECCB. The Eastern Caribbean dollar is pegged to the U.S. dollar at 2.7, adding to the stability of trade and investment in Grenada. The national currency rate does not fluctuate.

There are no restrictions or limitations placed on foreign investors in converting, transferring, or repatriating funds associated with investments. Funds associated with any form of investment can be freely converted. Banks reserve the right to delay transactions if deemed suspicious or outside the typical level of activity on the account.

Remittance Policies

There are no difficulties or delays regarding remittances and no proposed policy changes that would either tighten or relax access to foreign exchange for investment remittances.

Transfers of currency are protected by Article VII of the International Monetary Fund Articles of Agreement. Grenada is also a member of the Caribbean Financial Action Task Force.

Sovereign Wealth Funds

Grenada does not have a sovereign wealth fund.

Grenadian state-owned enterprises (SOEs) are legislatively established by acts of Parliament. These enterprises all have boards of directors appointed by the government and answerable to the relevant ministries. Twenty-five of the 28 authorized SOEs are operational. They secure credit on commercial terms from commercial banks. SOEs submit annual reports to the Government Audit Department and are subject to audits shared with their parent ministries. SOEs manage transportation infrastructure (ports and airports), housing, education, hospitals, cement production, investment promotion, and small business development, among other functions. Generally, where they compete with the private sector, they do so on an equal basis.

Grenada, like its neighbors, acknowledges the OECD guidelines. Corporate governance of SOEs is established and regulated by founding statutes. Local courts show no favoritism toward SOEs in the adjudication of investment disputes.

For additional information on SOEs in Grenada see: http://www.oecd.org/countries/grenada/ 

Privatization Program

Grenada does not have a privatization program.

Corporate social responsibility (CSR), interchangeably used with responsible business conduct, is a concept that was introduced to Grenada relatively recently by multinational and regional corporations. Local businesses are slowly incorporating this principle into their operations.

Some social responsibility initiatives undertaken by the private sector and non-governmental organizations (NGOs) include education programs, fitness programs, sporting activities, and cultural endeavors. These are predominantly implemented by the telecommunication companies Digicel and LIME, along with financial institutions. There is also a recent push towards environmentally friendly business practices and development projects.

While firms that promote CSR are more favorably viewed by the community, there is little familiarity with international CSR standards. Activities are deemed to be responsible business conduct if they are lawful, not a threat to national security, and not detrimental to the environment, health, and culture of the Grenadian people. Other than this being a requirement for any company operating in Grenada, CSR is not built into the laws governing the operations of a company.

There has been no high profile, controversial instances of private sector impact on human rights or resolution of such cases in the recent past. Grenada generally enforces domestic laws in relation to human rights, labor rights, consumer protection, environmental protection, and other laws/regulations intended to protect individuals from adverse business impacts. Local labor unions play a role in promoting and monitoring responsible business conduct. Grenada uses private security companies but is not a signatory to The Montreux Document or the International Code of Conduct or Private Security Service Providers.

Additional Resources 

Department of State

• Country Reports on Human Rights Practices;
• Trafficking in Persons Report;
• Guidance on Implementing the “UN Guiding Principles” for Transactions Linked to Foreign Government End-Users for Products or Services with Surveillance Capabilities and;
• North Korea Sanctions & Enforcement Actions Advisory

Department of Labor

• Findings on the Worst Forms of Child Labor Report;
• List of Goods Produced by Child Labor or Forced Labor.
• Sweat & Toil: Child Labor, Forced Labor, and Human Trafficking Around the World and;
• Comply Chain.

Grenada is a party to the Inter-American Convention against Corruption. The Integrity in Public Life Act (Act No.24 of 2013) requires that all public servants report their income and assets to the independent Integrity Commission for review. The Integrity in Public Life Commission monitors and verifies disclosures, although disclosures are not made public except in court. Failure to file a disclosure should be noted in the Official Gazette. If the office holder in question fails to file in response to this notification, the commission can seek a court order to enforce compliance.

The Office of the Ombudsman received 59 complaints in 2019, compared to 64 in 2018. Of the 59 complaints, six were closed, 19 are ongoing, advice/referrals were given to 25, and nine were outside the jurisdiction of the Ombudsman. Private entities received the highest number of complaints totaling 18, followed by the Ministry of Labor with 14. Of the 18 complaints, advice/referrals were given to 12, and six were beyond the jurisdiction of the Ombudsman. Of the 14 complaints against the Ministry of Labor, one was closed, 10 are ongoing, and three received advice/referrals.

Bribery is illegal in Grenada. For the most part, the enforcement of anti-bribery laws and procedures is effective and non-discriminatory.

Grenada is not party to the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. The country accepted and acknowledged the UN Convention against Corruption but has not yet signed or ratified it.

U.S. firms have not identified corruption as an obstacle to FDI in Grenada.

Resources to Report Corruption

Tafawa Pierre
Superintendent of Police/Head of FIU
Financial Intelligence Unit (FIU)
The Carenage, St. George’s, Grenada
(473) 435-2373 / 2374
gdafiu@spiceisle.com 

Allison Miller
Acting Ombudsman
Office of the Ombudsman
Tanteen, St. George’s, Grenada
(473) 435-9315
ombudsmangd@spiceisle.com 

Contact at “watchdog” organization:

Lady Anande Trotman-Joseph
Chairperson
Office of the Integrity Commission
Archibald Avenue, St. George’s, Grenada
(473) 439-9212/ 534-5190
office@grenadaintegritycommission.org 

Grenada has a stable parliamentary representative democracy free from political violence.

Grenada signed and ratified all the International Labor Organization’s (ILO) undertakings and enshrined these rights into its labor laws, including the Labor Relations Act No.1 of 1999 and the Employment Act No. 1 of 1999. Grenadian law protects the right of workers to be represented by a trade union of their choice.

Employers are generally expected to recognize a union that represents most workers but are not obligated to recognize a minority union formed by some employees if most of the workforce does not belong to said union. In accordance with the Trade Union Recognition Act No 29 of 1979, investors shall grant union representation at any site of employment if most employees indicate the desire for union representation. Investment enterprises are also required to contribute to the social insurance and welfare programs for their workers in accordance with the National Insurance Act.

The Ministry of Labor may refer disputes regarding workers in essential services to compulsory arbitration. Essential services include employees of utility companies, public health, and protection sectors, including sanitation, airport, seaport, and dock services.

Grenada does not restrict the legal activities of trade unions. Most of the workforce is unionized, and labor relations are generally stable.

Article 32 of the Employment Act prohibits employment of children under the age of 16 except for temporary holiday employment. Part 7 of the Employment Act provides for the protection and regulation of wages, and article 52 mandates the minimum wage. Minimum wage schedules are set by occupation. In the second quarter of 2020, the unemployment rate was 28.4 percent compared to 15.1 percent during the fourth quarter of 2019. In 2020, more than 14,000 jobs were lost from a labor force of approximately 50,000 due to the global COVID-19 pandemic and its impact on the tourism sector.

There have been strikes in the past year, but none posed an investment risk, and negotiations toward a satisfactory resolution continue. There are no gaps in compliance in law or practice with international labor standards that may pose a reputational risk to investors. No potential gaps were identified in law or in practice with international standards by the ILO.

No new labor-related laws or regulations were enacted during the last year, and no bills are pending.

* Source for Host Country Data: Government of Grenada, Ministry of Finance Statistics Division – https://www.finance.gd/, and the Eastern Caribbean Central Bank – https://www.eccb-centralbank.org/statistics/gdp-datas/comparative-report/1

Karl E. Duckworth
Principal Officer, U.S. Embassy Grenada
Tel: (473) 444-1176
Email: duckworthke2@state.gov 

Rachér Croney
Political & Economic Specialist
Tel: (473) 444-1173
Email: croneyrr@state.gov 

Contacts for Investment-Related Inquiries:

Ronald Theodore
CEO, Grenada Investment Development Corporation
Tel: (473) 444-1035
Email: Invest@grenadaidc.com  rtheodore@grenadaidc.com 
rtheodore@grenadaidc.com 
Website: www.grenadaidc.com 

Cathyann Alexander-Pierre
Senior Specialist, Investment Promotion Agency
Grenada Investment Development Corporation
Tel: (473) 444-1033-35, Ext.-236
Email: calexander@grenadaidc.com 

Policies Towards Foreign Direct Investment

The GoG recognizes foreign direct investment (FDI) as critical for growing and diversifying the Guyanese economy. Guyanese law does not discriminate against foreign investors. Shortly after being sworn in, President Ali committed to institute an electronic single window application process to expedite business registration, permitting, and improve the country’s Ease of Doing Business ranking. The GoG has prioritized investments in the following sectors: agriculture, agro-processing, light manufacturing, renewable energy, tourism and information and communications technology (ICT). The Guyana Office for Investment (GO-INVEST) is the GoG’s primary vehicle for promoting FDI opportunities and assisting foreign corporations with their business registrations and applying for tax concessions. Companies and investors are encouraged to do their due diligence and have robust business plans completed before approaching GOINVEST.

The GoG expects to table local content legislation before Parliament in the second quarter of 2021, which will set baseline requirements for foreign firms to hire Guyanese and establish taxation standards to foster greater local participation in the oil and gas sector. The aim of this legislation is to promote long term investments in Guyana, build local capacity, and avoid the resource curse.

Limits on Foreign Control and Right to Private Ownership and Establishment

Guyana’s constitution protects the rights of foreigners to own property in Guyana. Foreign and domestic firms possess the right to establish and own business enterprises and engage in all forms of commerce. Private entities are governed by the 1991 Companies Act (amended in 1995) under which they have the right to establish business enterprises and are free to acquire or dispose of interest in accordance with the law. Some key sectors like aviation, forestry, banking, mining, and tourism are heavily regulated and require licensing. The process to obtain licenses can be time consuming and may in some instances require ministerial approval.

The GoG prohibits foreign ownership of small-and-medium-scale mining (ASM) concessions. Foreign investors interested in participating in the industry at those levels may establish joint ventures with Guyanese nationals, under which the two parties agree to jointly develop a mining property. However, this type of relationship can carry a high level of risk because arrangements are governed only by private contracts and the sector’s regulatory agency, the Guyana Geology and Mines Commission (GGMC), offers little recourse for ASM disputes. The U.S. Embassy strongly encourages investors to thoroughly conduct their due diligence when exploring business opportunities.

Other Investment Policy Reviews

Guyana’s macro-economic fundamentals have remained stable over the past decade. The Ali administration is revising its Low Carbon Development Strategy (LCDS) to balance sustainable development goals with booming oil production. Developmental policies include incentives for priority areas, including education, health, renewable energy, agriculture, and agro-processing.

Government policy focuses on attracting inward FDI. The GoG applies national treatment to all economic activities, except for certain mining operations, although some foreign-owned companies conduct large-scale mining operations in the country. During its first months in office, the Ali administration took actions to improve the business environment such as repealing of taxes on corporate taxes on health, education, and construction materials. Incentives for FDI includes income tax holidays, and tariff and value-added tax (VAT) exemptions.

The World Trade Organization (WTO) published its most recent trade policy review of Guyana in 2015: https://www.wto.org/english/tratop_e/tpr_e/tp420_e.htm 

Business Facilitation

All companies operating in Guyana must register with the Registrar of Companies. Registration fees are lower for companies incorporated in Guyana than those incorporated abroad.  Locally incorporated companies are subjected to a flat fee of approximately $300 and a company incorporated abroad is subject to a fee of approximately $400. Depending on the type of business, registration may take three weeks or more. Newly registered businesses are encouraged to visit the Guyana Revenue Authority and apply for a tax identification number (TIN). If a company employs Guyanese workers, the company must demonstrate compliance with the National Insurance Scheme (social security). Businesses in the sectors requiring specific licenses, such as mining, telecommunications, forestry, and banking must obtain operation licenses from the relevant authorities before commencing operations. Guyana has six municipal authorities which also assess municipal taxes: Anna Regina, Corriverton, Georgetown, Linden, New Amsterdam, and Rosehall.

GO-INVEST advises the GoG on the formulation and implementation of national investment policies and provides facilitation services to foreign investors, particularly in completing administrative formalities, such as commercial registration and applications for land purchases or leases.  Under the Status of Aliens Act, foreign and domestic investors have the same rights to purchase and lease land. However, the process to access licensing can be complex and many foreign companies have opted to partner with local companies which may assist with acquiring a license. The Investment Act specifies that there should be no discrimination between foreign and domestic private investors, or among foreign investors from different countries. The authorities maintain that foreign investors have equal access to opportunities arising from privatization of state-owned companies.

Resources

Guyana Deeds and Commercial Registry: https://dcra.gov.gy/ 
GO-INVEST: https://goinvest.gov.gy/ 
Guyana Revenue Authority: https://www.gra.gov.gy/ 

Outward Investment

While the GoG is focused on attracting inward investment into Guyana, there are no restrictions for domestic investors to invest abroad. GO-INVEST supports Guyanese investors and exporters looking to operate overseas.  In 2019, the Natural Resource Fund Act (NRF) was passed which created Guyana’s sovereign wealth fund. The Act provides the Minister of Finance with responsibility for the overall management of the fund.  The NRF is currently held at the Federal Reserve Bank of New York and, as of February 2021, has a balance of $246.5 million from its nascent oil revenues and royalty payments. The Ali administration plans to amend the existing Natural Resource Fund Act and has committed to leave all funds on deposit until a new regulatory framework is adopted. The GoG has not stated an official investment policy for the sovereign wealth fund as of March 2021.

Transparency of the Regulatory System

Legal, regulatory, and accounting systems are consistent with international norms. Guyana is a democratic state and a separation of powers exists among the executive, legislative, and judicial branches of government.

As captured in the World Bank’s Doing Business Report, bureaucratic procedures are cumbersome, often requiring the involvement of multiple ministries. Investors report having received conflicting messages from various officials, and difficulty determining where the authority for decision-making lies.  In the absence of adequate legislation, most decision-making remains centralized. An extraordinary number of issues continue to be resolved in the presidential cabinet, a process that is commonly perceived as opaque and slow. Attempts to reform Guyana’s many bureaucratic procedures have not succeeded in reducing red tape.

International Regulatory Considerations

Guyana has been a World Trade Organization (WTO) member since 1995 and adheres to Trade-Related Investment Measures (TRIMs) guidelines. Guyana is also a member of the Caribbean Community (CARICOM) and is working to harmonize its regulatory systems with the rest of the CARICOM member states. Guyana is a member of the UNFCCC and reduces emissions from deforestation and forest degradation REDD+ initiative.

Guyana has laws on intellectual property rights and patents. However, a lack of enforcement offers few protections in practice and allows for the relatively uninhibited distribution and sale of illegally obtained content.

Legal System and Judicial Independence

Guyana’s legal system is mixed following the combination of civil and common laws. Guyana’s judicial system operates independently from the executive branch. The Caribbean Court of Justice, located in Trinidad and Tobago, is Guyana’s highest court. Registered companies are governed by the Companies Act and contracts are enforced by Guyanese courts or through a mediator. Guyana has a commercial court in its High Court, which has both original and appellate jurisdiction.

Laws and Regulations on Foreign Direct Investment

Legislation exists in Guyana to support foreign direct investment, but the enforcement of these regulations continues to be inadequate. The objective of the Investment Act of 2004 and Industries and Aid and Encouragement Act of 1951 is to stimulate socio-economic development by attracting and facilitating foreign investment. Other relevant laws include: the Income Tax Act, the Customs Act, the Procurement Act of 2003, the Companies Act of 1991, the Securities Act of 1998, and the Small Business Act. Regulatory actions are still required for much of this legislation to be effectively implemented. The Companies Act provides special provisions for companies incorporated outside of Guyana called “external companies.” Companies should direct their inquiries about regulations on FDI to GO-INVEST.

Guyana has no known examples of executive interference in the court system that have adversely affected foreign investors. The judicial system is generally perceived to be slow and ineffective in enforcing legal contracts. The 2020 World Bank’s Doing Business Report states that it takes 581 days to enforce a contract in Guyana.

Competition and Antitrust Laws

The Competition Commission of Guyana was established under the 2006 Competition and Fair Trading Act. The Competition and Fair Trading act seeks to promote, maintain, and encourage competition; to prohibit the prevention, restriction, or distortion of competition, the abuse of dominant trade positions; and to promote the welfare and interests of consumers. The Competition Commission and Consumer Affairs Commission (CCAC) is responsible for investigating complaints by agencies and consumers, eliminating anti-competitive agreements, and may institute or participate in proceedings before a Court of Law.  For mergers and acquisitions within of the banking sector, the Bank of Guyana has ultimate oversight and approval.

Expropriation and Compensation

The government can expropriate property in the public interest under the 2001 Acquisition of Land for Public Purposes Act, although there are no recent cases of expropriation. There is adequate legislation to promote and protect foreign investment, however, enforcement is often ineffective. Many reports view Guyana’s judicial system as being slow and ineffective in enforcing legal contracts. All companies are encouraged to conduct due diligence and seek appropriate legal counsel for any potential questions prior to doing business in Guyana.

Dispute Settlement

Guyana is a party to the International Centre for Settlement of Investment Disputes (ICSID Convention). Additionally, Guyana has ratified the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958 New York Convention), which entered into force in December 2014.

Investor-State Dispute Settlement

Guyana does not have a bilateral investment treaty with the United States. Negotiations began in 1993 but broke down in 1995. Since then, the two countries have not conducted subsequent negotiations.

Double taxation treaties are in force with Canada (1987), the United Kingdom (1992), and CARICOM (1995). Other double taxation agreements remain under negotiation with India, Kuwait, and the Seychelles. The CARICOM-Dominican Republic Free Trade Agreement provides for the negotiation of a double taxation agreement, but no significant developments have occurred since March 2009.

There is one ongoing investment dispute involving a U.S. telecommunications company, which previously held a legal monopoly in Guyana, contesting its liability for back taxes.

International Commercial Arbitration and Foreign Courts

International arbitration decisions are enforceable under the 1931 Arbitration Act of British Guiana, as amended in 1998. The Act is based on the Geneva Convention for the Execution of Foreign Arbitral Awards of 1927. The GoG enforces foreign awards by way of judicial decisions or action, and such awards must be in line with the policies and laws of Guyana.

According to the 2020 World Bank’s Doing Business Report, resolving disputes in Guyana takes 581 days, and on average costs 27 percent of the value of the claim. According to many businesses, suspected corrupt practices and long delays make the courts an unattractive option for settling investment or contractual disputes, particularly for foreign investors unfamiliar with Guyana.

The GoG has set up a Commercial Court to expedite commercial disputes, but this court only has one judge presiding, and companies have reported that it is overwhelmed by a backlog of cases.  The Caribbean Court of Justice, based in Trinidad and Tobago, is Guyana’s court of final instance. In practice, most business disputes are settled by mediation which avoids a lengthy court battle and keeps costs low to both parties. Guyanese state-owned enterprises are not widely involved in investor disputes. To date, there are no complaints on the court process relating to judgments involving state owned enterprises.

Bankruptcy Regulations 

The 1998 Guyana Insolvency Act provides for the facilitation of insolvency proceedings.  The 2004 Financial Institutions Act gives the Central Bank power to take temporary control of financial institutions in trouble.  This Act provides legal authority for the Central Bank to take a more proactive role in helping insolvent local banks.

According to data collected by the World Bank Doing Business Report, resolving insolvency in Guyana takes three years on average and costs 28.5% of the debtor’s estate, with the most likely outcome being that the company will be sold piecemeal.  The average recovery rate is 18 cents on the dollar. Globally, Guyana ranks 163 out of 190 economies on the Ease of Resolving Insolvency Report.

Investment Incentives

Guyana offers an array of incentives to foreign and domestic investors alike in the form of exemption from various taxes, accelerated depreciation rates, full and unrestricted repatriation of capital, profits and dividends. The first point of contact in applying for tax concessions is GO-INVEST. The GoG utilizes investment incentives to advance its broader policy goals, such as boosting research and development, or spurring growth in a particular region.

Information on investment incentives in Guyana can be found on the following websites:

Guyana Office for Investment:   http://goinvest.gov.gy/investment/investment-guide/ 
The National Procurement & Tender Administration (NPTA):   http://www.npta.gov.gy/ 
National Industrial & Commercial Investment Limited:  http://www.privatisation.gov.gy 
Ministry of Finance:  https://finance.gov.gy/procurements 

Foreign Trade Zones/Free Ports/Trade Facilitation

Guyana does not have free trade zones, however, the GoG is contemplating establishing free trade zones in Lethem, a Guyanese town on the Brazilian border that relies heavily on cross border commerce.

Guyana was the 53rd WTO member and first South American country to ratify the new Trade Facilitation Agreement (TFA).  The WTO Secretariat received Guyana’s instrument of acceptance on November 30, 2015.

Performance and Data Localization Requirements

There are no data localization requirements in Guyana.  Foreign investors are not required to establish or maintain a certain amount of data storage within the country. There is no visa requirement for U.S. citizens to visit Guyana. There are no government-imposed conditions to invest. However, if seeking tax concessions, an entity will be bound to an investment agreement.

A requirement to hire locally at least 80 percent of employees is applied equally to domestic and foreign investment projects. This percentage, however, will likely change once the GoG enacts its new local content policy, likely in the second quarter of 2021.  Although no explicit government policy exits regarding performance requirements, some are written into contracts with foreign investors and could include the requirement of a performance bond.  Some contracts require a certain minimum level of investment. Investors are not required to source locally, nor must they export a certain percentage of output.  Foreign exchange is not rationed in proportion to exports, nor are there any requirements for national ownership or technology transfer. There are no requirements for foreign IT providers to provide source code. There are no measures to prevent or restrict companies from transmitting customer or business data. The government agencies involved for local data storage include the National Data Management Authority and the Office of the Prime Minister.

Real Property

Property rights are enforced but it is often time consuming to determine the rightful owner of a particular plot of land. Ownership of property can be unclear even among government entities and potential investors are encouraged to have a local lawyer review any potential property purchase before executing the deal.

Guyana has a dual registry system of property rights with distinct requirements, processes, and enforcement mechanisms.  The two types of registry systems are deeds (regulated by the Deeds and Commercial Registry) and title (regulated by the Land Registry) registries that operate in separate jurisdictions, which in theory helps avoid the problem of double entry and dual registration.  Companies often complain about Guyana’s property rights being overly bureaucratic and complex, with opaque regulations that overlap and compete. Some report that this affects the proper allocation, enforcement, and effectiveness of property rights, as well as the efficiency of property-based markets, such as real estate and financial markets (especially primary ones, such as mortgage markets).  As previously stated, the judicial system is generally perceived to be slow and ineffective in enforcing legal contracts. The GoG is the country’s largest landowner. Property can be reverted to squatters who have squatted for over 10 years, but in most instances the GoG repossesses the land.

Intellectual Property Rights

Upon independence in 1966, Guyana adopted British law on intellectual property rights (IPR). Guyana’s relevant laws governing intellectual property rights (IPR) are the 1956 Copyright Act and the 1973 Trademark Act and Patents and Design Act.  Local contacts report that numerous attempts to pass comprehensive reforms to this legislation have been unsuccessful. However, piecemeal modernization amendments contained in the 2005 Geographic Indication Act, the 2006 Competition and Fair Trading Act, the 2000 Business Names Registration Act, and the 1999 Deeds Registry Authority Act have offered additional protection to local products and companies.

No modern legislation exists to protect the foreign-registered rights of investors. However, investors are encouraged to seek a lawyer to register and/or make an application for intellectual property. In the case of trademarks, registration is done through writing to the registrar, which once accepted after advertisement in the official gazette, the registrar inserts the particulars and issues a registration bearing the seal of the patent office. Guyana joined the World Intellectual Property Organization (WIPO) and acceded to the Berne Convention for the Protection of Literary and Artistic Works and the Paris Convention for the Protection of Industrial Property in 1994. Guyana has not ratified a bilateral IPR agreement with the United States. The previous government drafted IPR legislation, which has yet to be taken up in Parliament.

Many businesses report that the registration time for a patent or trademark may take in excess of six months. However, there is a lack of effective enforcement to protect intellectual property rights. Patent and trademark infringement are common, as is evident among local television broadcasts of pirated and rebroadcasted TV satellite signals. Guyana has seen seizures of counterfeited food items by the Guyana Foods and Drugs Analyst Department (GFDD). However, the GFDD is severely short staffed and unable to police all commerce effectively. Local news media sources report that piracy of foreign academic textbooks is common. Guyana’s laws have not been amended to fully conform to the requirements of the Trade Related Intellectual Property Rights (TRIPS) Agreement.

Guyana is not listed in the U.S. Trade Representative’s 2021 Special 301 Report or its 2020 Review of Notorious Markets for Counterfeiting and Piracy.

For additional information about treaty obligations and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/ .

Capital Markets and Portfolio Investment

Guyana has its own stock market, which is supervised by the Guyana Association of Securities Companies and Intermediaries (GASCI).  Dividends earned from the local stock exchange are tax free.  Guyana’s local stock market performed well in 2020 with a 15 percent increase in its market capitalization.  Credit is available on market terms. The Central Bank respects IMF Article VIII with regard to payments and transfers for international transactions.

Money and Banking System

Guyana relies heavily on cash payments for most financial transactions, but credit cards and mobile payment options are increasingly common. The GoG’s monetary policy remains accommodative, aimed at achieving price stability and controlling liquidity within the economy. The financial sector is regulated by the Bank of Guyana (BOG), the country’s central bank.  The BOG is empowered under the 1995 Financial Institutions Act and the Bank of Guyana Act to regulate the financial sector.  Under these regulations a bank operating in Guyana must maintain high levels of liquidity and a strong deposit and asset base.

In the middle of 2020, licensed depository financial institutions’ (LDFIs’) capital levels continued to be high, while non-performing loans (NPLs) increased marginally during the first half of 2020. The capital adequacy ratio (CAR) remained well above the prudential benchmark of 8.0 percent at 30.7 percent. The stock of NPLs deteriorated to 10.6 percent of total loans. Stress testing was performed by the Central bank with preliminary results indicating that the banking industry’s and individual institutions’ shock absorptive capacities remained adequate under the various scenarios for foreign currency and liquidity. However, vulnerabilities were observed in the investment and credit portfolios. Guyana’s Banking Stability index strengthened from -0.22 in March 2020 to 0.15 in June 2020 attributed to improvement in liquidity. The commercial banking sector grew by 7.2 percent from March 2019 to March 2020. Foreign banks seeking to open operations in Guyana are encouraged to engage with the Bank of Guyana and GO-INVEST.

Guyana has six commercial banks.  Foreign banks can provide domestic services or enter the market with a license from the BoG.  There are no restrictions on a foreigner’s ability to establish a bank account.

Foreign Exchange and Remittances

Foreign Exchange

The Guyanese Dollar (GYD) is fully convertible and transferable, and generally stable in its value against the U.S. dollar. The Guyana dollar weighted mid-rate, relevant for official transactions, remained constant at GYD 208.50 as at half year 2020. Guyana employs a de jure float exchange rate.

No limits exist on inflows or repatriation of funds. However, regulations require that all persons entering and exiting Guyana declare all currency in excess of $10,000 to customs authorities at the port of entry. It is common practice for foreign investors to use subsidiaries outside of Guyana to handle earnings generated by exports.

Remittance Policies 

There is no limit on the acquisition of foreign currency, although the government limits the amount that several state-owned firms may keep for their own purchases.  Regulations on foreign currency denominated bank accounts in Guyana allow funds to be wired in and out of the country electronically without having to go through cumbersome exchange procedures.  Foreign companies operating in Guyana have not reported experiencing government-induced difficulties in repatriating earnings in recent years.

Sovereign Wealth Funds

Guyana established a sovereign wealth fund, the Natural Resource Fund (NRF), in 2019, which is governed by the 2019 Natural Resources Act in accordance with the Santiago Principles. In December 2019, the Ministry of Finance and Bank of Guyana signed an operational agreement for the NRF . However, the Ali administration, noting the NRF’s passage under a previous government, has committed to repeal and replace the act to further insulate the NRF from potential political intervention. Until the NRF is amended the GoG does not expect to access the funds which has are held in the New York Federal Reserve Bank. As at March 10, 2021, the SWF held a balance of approximately $268 million.

Guyana has ten state-owned enterprises (SOEs) including: National Industrial and Commercial Investments Ltd. (NICIL), Guyana Sugar Corporation (GUYSUCO), MARDS Rice Complex Ltd., National Insurance Scheme (NIS), Guyana Power and Light (GPL), Guyana Rice Development Board (GRDB), Guyana National Newspapers Ltd. (GNNL), Guyana National Shipping Corporation (GNSC) and Guyana National Printers Ltd. (GNPL).

The private sector competes with SOEs for market share, credit, and business opportunities. It is common for SOEs in Guyana to experience political interventions, driven by boards of directors filled with political appointees. Procurement on behalf of SOEs may be passed through the National Procurement and Tender Administration or handled directly by the SOE.

The Public Corporation Act requires public corporations to publish an annual report no later than six months after the end of the calendar year. These reports must be audited by an independent auditor.

Privatization Program

In the 1990s, Guyana underwent significant privatization with the divestment of many sectors.  In 1993, the Privatisation Policy Framework Paper known as the “Privatisation White Paper” was tabled in Parliament and led to the creation of the Privatisation Unit (PU). Its function was to co-ordinate the implementation of the GoG’s privatization program and was tasked with:

• Combining the functions of the Public Corporations Secretariat (PCS) and the National Industrial & Commercial Investments Limited (NICIL);
• Preparing for the program strategy and annual program targets for privatization or liquidation Cabinet’s approval;
• Implementing the privatization of SOEs and assets selected for inclusion in the program;
• Participating in negotiations for the privatization of SOEs;
• Reviewing offers and making recommendations to Cabinet on the terms and conditions for the sale of SOEs;
• Preparing financial and administrative audits of SOEs not selected for privatization;
• Developing a strategy to build public understanding and support for privatization;
• Ensuring that transparency of the privatization program is strictly respected and followed;
• Monitoring operations of privatized entities in accordance with the terms and conditions of each respective contract;
• Preparing for Cabinet, broad guidelines on operating policies for privatization, develop action plans for implementation, conduct a public relations campaign and help to build national consensus in support of government’s program.

Foreign investors have equal access to privatization opportunities. However, there are many reports that the process is opaque and favors politically connected local businesses. Currently, the GoG is interested in privatizing at least a portion of GUYSUCO.

U.S. firms are generally given equal access to these projects through a public bidding process. However, many bidders continue to complain about the criteria and question their unsuccessful attempt at securing a contract.  In cases where international financial institution (IFI) funding has been involved in the project, such allegations have been credibly addressed. In cases where the project relied solely on GoG funds, redress has been more problematic to achieve.

Compared to responsible business conduct (RBC) norms in North America and Europe, Guyana-based businesses lag in adopting RBC policies and activities. Most companies conform to their business responsibilities outlined by the Organization for Economic Co-operation and Development (OECD), including human rights and labor rights, information disclosure, environment, bribery, consumer interests, science and technology, competition, and taxation. Guyana’s laws align with the guidelines for RBC by the OECD. Despite these improvements, Guyana has human rights concerns, especially involving child labor in outlying regions.

Local companies have improved RBC as firms react to increased levels of competition, partly to compete or subcontract with companies in the oil and gas sector that emphasize it.  Guyanese consumers are increasingly aware of RBC principles as the population becomes more sensitized. The GoG has expressed hope that large multinational companies will lead the way on RBC practices, setting an example for smaller local firms to follow, particularly in the extractive industries sector.  Guyana joined the Extractive Industries Transparency Initiative (EITI) as a candidate country in October 2017.  Guyana is not a signatory of the Montreux Document.

Additional Resources

Department of State

• Country Reports on Human Rights Practices;
• Trafficking in Persons Report;
• Guidance on Implementing the “UN Guiding Principles” for Transactions Linked to Foreign Government End-Users for Products or Services with Surveillance Capabilities and;
• North Korea Sanctions & Enforcement Actions Advisory

Department of Labor

• Findings on the Worst Forms of Child Labor Report;
• List of Goods Produced by Child Labor or Forced Labor.
• Sweat & Toil: Child Labor, Forced Labor, and Human Trafficking Around the World and;
• Comply Chain.

The law provides criminal penalties for corrupt practices by public officials. The relevant laws enacted include the Integrity Commission Act, State Assets Recovery Act, and the Audit Act. Several media outlets reported on government corruption in recent years and it remains a significant public concern.  Guyana has regulations to counter conflict of interests in the award of contracts. There are instances where the previous administration engaged in those practices, and it remains to be seen if the current administration will continue the trend; new administrations often seek legal action against members of previous administrations based on charges of fraudulent dealings. Media and civil society organizations continued to criticize the government for being slow to prosecute corruption cases.  The government passed legislation in 1997 that requires public officials to disclose their assets to an Integrity Commission prior to assuming office.  There are no significant compliance programs to detect bribery of government officials.

Widespread concerns remain about inefficiencies and corruption regarding the awarding of contracts, particularly with respect to concerns of collusion and non-transparency.  In his 2020 annual report, the Auditor General noted continuous disregard for the procedures, rules, and the laws that govern public procurement system.  There were reports of overpayments of contracts and procurement breaches.  Nevertheless, the country has made some improvements. According to Transparency International’s 2020 Corruption Perceptions Index (CPI), Guyana ranked 83 out of 180 countries for perceptions of corruption, falling 2 spots in comparison to 2019.

Companies interested in doing business in Guyana may contact a “watchdog” organization (international, regional, local nongovernmental organization operating in the country/economy that monitors corruption, such as Transparency International) for more information:

Transparency Institute of Guyana Inc.
157 Waterloo Street
Second Floor Private Sector Commission Building
North Cummingsburg
Georgetown
+592 231 9586
infotransparencygy@gmail.com 

Guyana has a high crime rate, and violence associated with drug and gold smuggling is on the rise. The country peacefully transitioned to a new government on August 2, 2020 after a 20 month-long extra-constitutional and electoral crisis, which saw few instances of politically-incited violence. The GoG has committed to electoral reform in the wake of the 2020 electoral crisis in order to avoid electoral impasses in the future.

The security environment in the country continues to be a concern for many businesses. Businesses considering investing in Guyana are strongly encouraged to develop adequate security systems.

Guyana’s labor market is tightening due to high investments in sectors driven by the oil and gas industry. In 2020, the total population aged 15 and above residing in Guyana was 602,795. In the first quarter of 2020, the labor force participation rate was 50.4 percent. Unemployment stood at 12.8 percent in the first quarter of 2020. A concerning trend is an increase in youth unemployment, jumping from 29.7 percent in the fourth quarter of 2019 to 30.2 percent in first quarter of 2020. Guyana has witnessed an influx of Venezuelan migrants which predominantly work in mining areas and in the restaurant industry. Chinese firms continue to invest heavily in Guyana with many companies importing Chinese workers for most of their operations. The Ali administration has committed to implement local content legislation which may include a requirement for hiring a fixed percentage of nationals. Guyana has a national insurance scheme, but social safety net programs do not exist for the general population. Strikes are common in the sugar industry and may vary with the public sector during collective bargaining sessions.

Local legislation governing labor in Guyana includes the National Insurance Act, Guyana Labour Act, Occupation Health and Safety Act, and the Termination of Severance and Pay Act.  Guyana’s Human Development Index for 2020 increased to 0.67 from 0.682. Guyana’s literacy rate is estimated at 90%. There is an ongoing push for information and communications technology curriculum in Guyana’s schools to develop a talent pool for this industry.

Guyana has one of the highest emigration rates in the world for nationals with a university degree of 89 percent. A significant number of businesses report having challenges with staff recruitment and retention.  These issues are linked to a small pool of semi-skilled and skilled workers.  Companies entering Guyana should consider training and capacity building opportunities for their employees.

The 1997 Trade Union Recognition Act requires businesses operating in Guyana to recognize and collectively bargain with the trade union selected by a majority of its workers.  The government, on occasion, has unilaterally imposed wage increases. Guyana adheres to the International Labor Organization (ILO) Convention, protecting worker rights.  The private sector has a minimum monthly wage of approximately $210.

Table 3: Sources and Destination of FDI
Data not available.

Table 4: Sources of Portfolio Investment
Data not available.

Seth Wikas
Political and Economic Counselor

Benjamin Hulefeld
Economic and Commercial Officer

Richard Leo
Economic and Commercial Specialist

Embassy of the United States of America
100 Duke and Young Streets, Kingston
Georgetown, Guyana
Telephone: + (592) 225-4900-9 Ext. 4220 and Ext. 4213
Fax: + (592) 225-8597
Email:  commercegeorgetown@state.gov 
https://gy.usembassy.gov

Policies Towards Foreign Direct Investment

The Government of Suriname (GOS) officially supports and encourages business development through foreign and local investment. The overall investment climate favors U.S. investors with experience working in developing countries. Investment opportunities exist in mining, agriculture, the oil and gas sector, timber, fishing, financial technology and tourism.

With the exception of petroleum, Suriname has no sector-specific laws or practices that discriminate against foreign investors, including U.S. investors, by prohibiting, limiting or conditioning foreign investment. In the oil sector, the state oil company, Staatsolie, maintains sole ownership of all oil-related activities. Foreign investment is possible through exploration and product sharing contracts (PSCs) with Staatsolie. Five U.S. companies participate in PSCs as operators and/or as contract partners. A full list of PSCs can be found on Staatsolie’s website: https://www.staatsolie.com/en/staatsolie-hydrocarbon-institute/active-production-sharing-contracts/ 

In February 2021, the Government of Suriname announced that it will terminate its two existing investment entities, namely the Institute for Promoting Investments in Suriname (InvestSur) and the Investment and Development Corporation of Suriname (IDCS) in order to establish a new investment company. In March 2021, the National Assembly launched debate on a draft law to establish a State-owned investment company to be named the Suriname Investment Enterprise NV. The government also created an International Business Directorate at the Ministry of Foreign Affairs to act as a first point of entry for foreign investors.

Suriname does not have a formal business roundtable or ombudsman aimed at investment retention or maintaining an ongoing dialogue with investors.

Limits on Foreign Control and Right to Private Ownership and Establishment

Foreign and domestic private entities can establish and own business enterprises and engage in all forms of remunerative activity.

There are no general limits on foreign ownership or control – statutory, de facto, or otherwise. No law requires that domestic nationals own a minimum percentage of domestic companies or that foreign nationals hold seats on the board. No law caps or reduces the percentage of foreign ownership of any private business enterprise.

Except for petroleum, there are no sector-specific restrictions applied to foreign ownership and control. Within the petroleum sector, the law limits ownership to Staatsolie, the state-owned oil company, which maintains sole ownership of all petroleum-related activities. Caribbean Single Market and Economy (CSME) countries do enjoy favored status over other sources of foreign investment, but in practice international firms from beyond the CSME are not denied investment opportunities. An Economic Partnership Agreement (EPA) with the European Union aims to provide European companies better access to Suriname. Suriname has not yet ratified the EPA.

Government ministries screen inbound foreign investments intended for the sector of the economy that they oversee. Special commissions screen all necessary legal and financial documents. Screening criteria vary, but are intended to determine a proposed investment’s compliance with local law. The screening process is neither public nor transparent, and therefore could be considered a barrier to investment. The Department of International Business at the Ministry of Foreign Affairs requests that prospective investors fill out an intake form. The intake form will enable its appraisal committee to conduct a quick scan and conclude whether the FDI in question fits the development goals of the government.

Other Investment Policy Reviews

The World Trade Organization (WTO) conducted an investment policy review of Suriname in 2019: https://www.wto.org/english/tratop_e/tpr_e/tp491_e.htm 

The Inter-American Development Bank published a report called Framework for Private Development in Suriname in 2013.The World Bank Group published Suriname Sector Competitiveness Analysis, focusing on the agribusiness and extractive sectors in 2017.

Business Facilitation

The Santokhi administration has emphasized its desire to diversify Suriname’s economy and deepen business ties with the United States, Europe, and others. In 2020, Suriname’s new government began publishing public tenders on the website of the Ministry of Public Works. The government created a Presidential Commission on the Surinamese Diaspora in an effort to explore possibilities for raising capital and increasing business ties with the Surinamese community in the Netherlands. In March 2021, the National Assembly launched debate on a draft law to establish a State-owned investment company to be named the Suriname Investment Enterprise NV. The government also created an International Business Directorate at the Ministry of Foreign Affairs to act as a first point of entry for foreign investors.

There is no online registration system. Companies must register with the local Chamber of Commerce and Industry, which provides guidance on registration procedures. At the time of registration, the company needs a local notary’s assent to ratify the company bylaws. For non-residents, the notary also sends a request to the Foreign Exchange Commission for approval. Applicants must obtain a tax number at the registration office of the tax department. Applications then go to the Ministry of Justice and Police and finally to the President for approval. The Ministry of Trade, Industry and Tourism launched the Suriname Electronic Single Window (SESW) in September 2019. Online submission and processing of documents required for import, transit of goods, and export is now possible. The World Bank’s Doing Business report indicates starting a business requires 66 days. The local Chamber of Commerce and Industry states it can take as little as 30 days.

Outward Investment

The Government does not promote or incentivize outward investment. Suriname’s outward investment is minimal.

The Government does not restrict domestic investors from investing abroad, but there are no specific mechanisms in place to promote the practice. Due to the small size of the local market, some domestic companies have expanded to CARICOM member states, such as Guyana and Trinidad & Tobago.

Transparency of the Regulatory System

Suriname does not use transparent policies and effective laws to foster competition. The previous National Assembly (2015-2020) indicated that it would vote on a draft competition law, but did not do so. The Competitiveness Unit of Suriname coordinates and monitors national competitiveness and is working towards establishing policies and suggesting legislation to foster competition. Current legislation on topics such as taxes, the environment, health, safety, and other matters are not purposely used to impede investment, but may still form obstacles. Employment protection legislation is among the most stringent in the world. Labor laws, for instance, prohibit employers from firing an employee without the permission of the Ministry of Labor once the employee has fulfilled his or her probationary period, which by law is limited to two months. Tax laws are criticized for overburdening the formal business sector, while a large informal sector goes untaxed. Public sector contracts and concessions are not always awarded in a clear and transparent manner. The current administration has announced its commitment to greater transparency in the public tendering process, and the Ministry of Public Works is publishing procurement notices on its website on a regular basis.

There are no informal regulatory processes managed by non-governmental organizations or private sector associations.

Rule-making and regulatory authority exist within relevant ministries at the national level. It is this level of regulation that is most relevant for foreign businesses. The government may consult with relevant stakeholders on regulations, but there is no required public process. The government presents draft laws and regulations to the Council of Minsters for discussion and approval. Once approved, the President’s advisory body, the State Council, considers the draft. If approved, the government presents a draft to the National Assembly for discussion, amendment, and approval, and then to the President for signature. Legislation only goes into effect with the signature of the President and after publication in the National Gazette.

Legal, regulatory, and accounting systems are often outdated and therefore not transparent nor consistent with international norms. The National Assembly passed the Act on Annual Accounts in 2017 to create more fiscal transparency by requiring all companies, including state owned enterprises, to publish annual accounts based on the International Financial Reporting Standards (IFRS). The law went into effect in 2020 for large companies, while it went into effect for small and medium sized companies (SMEs) in 2021. Small companies can use the IFRS for SMEs.

Suriname passed new legislation in October 2018 to professionalize and institute better standards in the accountancy profession. The legislation created the Suriname Chartered Accountants Institute (SCAI) and makes membership mandatory for accountants in Suriname. The board of the SCAI has the responsibility to monitor the quality of the profession and apply disciplinary measures.

Draft bills or regulations are discussed in view of the public, and relevant stakeholders may be consulted. The National Assembly has established the email address feedbackwetgeving@dna.sr  as a place where individuals can give their opinion on draft legislation.

There is no centralized online location similar to the Federal Register in the United States where key regulatory actions are published. However, the National Assembly publishes the actual text of adopted laws on its website.

It is unclear what the regulatory enforcement mechanisms that ensure the government follows administrative processes might be, as the processes have not been made accountable to the public. There is no public administration law. The Auditor General’s office is an independent body in charge of supervising the financial management of government funds. The Supreme Audit Institution reports to the National Assembly. The Central Accountant Service exercises control on administrative processes at the ministries and reports to the Ministry of Finance. There is no centralized online location where key regulatory actions or their summaries are published, similar to the Federal Register in the United States.

The minimum wage law was revised by State Decree on July 18, 2019. The government will determine the minimum wage biennially. Regulatory reform efforts announced in prior years have largely not been fully implemented. In January 2021, the government announced its intent to implement a value-added tax (VAT) by January 1, 2022.

Reforms such as the revised minimum wages had at most a modest impact due to inflation.

It is unclear what the regulatory enforcement mechanisms are, as the process has not been made public. Regulations are developed by ministries that have jurisdiction over the relevant area, in consultation with involved stakeholders.

The government’s executive budget proposal and enacted budget are easily accessible to the public. The previous government, led by President Desire Delano Bouterse, submitted an executive budget proposal for 2020, but the budget was not passed. The current administration, led by President Chandrikapersad Santokhi, submitted a draft amended budget for 2020, which the National Assembly passed in November 2020. Actual revenues and expenditures regularly deviate from the enacted budget, and the origin and level of accuracy of some information in the budget were not reliable. A full end-of-year report is not publicly available. The Supreme Audit Institution publishes a limited audit based on self-reporting by the ministries. The State Debt Management Office (SDMO) is responsible for the operational management of the public debt of the government. Data regarding public debt is published every three months in the Government Gazette of Suriname and on the SDMO website.

International Regulatory Considerations

As a member of CARICOM, Suriname has committed to regionally-coordinated regulatory systems.

Suriname uses national and international standards. Standards developed by other (international/regional) standardization bodies that Suriname utilizes include: ISO, Codex Alimentarius, International Electro Technical Commission, CROSQ, ASTM International, COPANT, SMIIC (Standards and Metrology Institute for Islamic Countries), NEN (Nederland Normalisatie Instituut), ETSI, GLOBAL GAP, etc..

Suriname is a member of the World Trade Organization (WTO). The WTO Committee on Technical Barriers to Trade (TBT) lists only one notification from Suriname in 2015.

Legal System and Judicial Independence

Suriname’s legal system is based on the Dutch civil system. Judges uphold the sanctity of contracts and enforce them in accordance with their terms. When an individual or company disputes a signed contract, they have the right to take the case to court. The judiciary consistently upholds local law, applies it, and enforces it for local and international businesses.

Laws are defined in criminal, civil, and commercial codes and verdicts are based on the judge’s interpretation of those codes. There is no specialized commercial court. The commercial codes contain commercial legislation.

Historically, the judicial system has been considered to be independent of the executive branch. Most observers consider the judicial system to be procedurally competent, fair, reliable, and free of overt government interference. Due to a shortage of judges and administrative staff, processing of civil cases can be delayed. Last year, the Court of Justice appointed seven new judges to ease the delay in court cases. The number of judges is now 30.

Draft regulations may be reviewed by involved stakeholders and they may be given the opportunity to comment. Since October 2019, individuals have also had the option to comment on draft legislation via email at feedbackwetgeving@dna.sr. There is no formal, required public consultation process. Suriname has no general administrative law, so there are no special administrative tribunals. Judges of the regular courts also hear cases of administrative law.

Laws and Regulations on Foreign Direct Investment

The overall regime, and more particularly the approval of foreign direct investment (FDI), may be discretionary rather than rules-based, leading to heightened unpredictability and uncertainty, and associated risks of favoritism and corruption.

In March 2020, the previous National Assembly passed the Foreign Exchange Act, which placed constraints on the use of foreign currency in cash transactions and established a strict exchange rate for the Surinamese dollar. It also granted the government broad authorities to enforce the law, as well as the power to halt the import of “non-essential” goods. In May 2020, a judge suspended the law over questions concerning its constitutionality. In March 2021, the Santokhi govenrment revoked the law and submitted an amended version to the National Assembly for debate.

In April 2020, the previous National Assembly passed the COVID-19 State of Emergency Law, which granted the government broad powers to enforce COVID-19-related precautionary measures. It also created a $53 million fund to assist struggling businesses, and it allowed the government to take loans and advances from local institutions and consolidate them into a single mega-loan. The new National Assembly extended the law in August 2020 and extended it once again in February 2021.

In September 2020, the new National Assembly amended the State Debt Act and the COVID-19 State of Emergency Law. The changes in these laws allow the government to take out local and international loans in order to respond to the global pandemic. In November 2019, the previous National Assembly amended the State Debt Act in order to raise the government’s debt ceiling from 60% of GDP to 95% of GDP.

In February 2021, the Foreign Exchange Commission announced three new measures regarding exchange rate policy. First, exporters will be required to repatriate all their earned export revenues to Suriname, which also means that the buyer abroad will have to pay for the purchased goods through a Surinamese commercial bank. Second, exporters and foreign exchange offices will be required to exchange 30% of their income in foreign currency to the local currency, the Surinamese Dollar (SRD). Third, importers are required to pay for their imports via Surinamese commercial banks. The stated intention of this measure is to foreclose the possibility that exporters act as illegal “cambios” to finance imports and thus make illegal profits. It is also designed to combat trade-based money laundering.

Several criminal investigations of former government officials began in 2020. In February 2020, former Central Bank Governor Robert van Trikt was arrested on fraud charges. In August 2020, the new National Assembly officially indicted ex-Minister of Finance Gillmore Hoefdraad, which allowed the Attorney General to launch an investigation into alleged financial mismanagement conducted by Hoefdraad in collaboration with the ex-Governor of the Central Bank of Suriname, Robert van Trikt. In December 2020, the new National Assembly voted to indict former Vice President (and current National Assembly member) Ashwin Adhin, which allowed the Attorney General to pursue a criminal investigation for embezzlement, fraud, and destruction of government property. The cases remain ongoing.

There is no primary one-stop-shop website for investments that provide relevant laws, rules, procedures, and reporting requirements for investors.

Competition and Antitrust Laws

There are no domestic agencies currently reviewing transactions for competition-related concerns. The previous National Assembly (2015-2020) considered draft laws on competition and consumer protection, but did not ultimately vote on them. According to the authorities, no date for enactment is foreseen. Both draft laws also cover state-owned enterprises. The CARICOM Competition Commission is based in Suriname, and it monitors potential anti-competitive practices for enterprises operating within the CARICOM Single Market and Economy.

Expropriation and Compensation

According to Article 34 of Suriname’s constitution, expropriation will take place “only for reasons of public utility” and with prior compensation. In practice, the government has no history of expropriations. However, Article 42 of Suriname’s constitution specifically refers to all natural resources as property of the nation, and states that the nation has inalienable rights to take possession of all natural resources to utilize them for the economic, social, and cultural development of Suriname.

There is no history of expropriation.

Dispute Settlement

ICSID Convention and New York Convention

Suriname is not a party to the Convention on the Settlement of Investment Disputes between States and Nationals of other States (ICSID). Suriname has been a member of the New York Convention of 1958 on the Recognition and Enforcement of Foreign Arbitral Awards since 1964, when the country was still a colony of the Netherlands. Upon becoming independent in 1975, Suriname automatically continued its membership in international conventions and treaties.

There is no specific domestic legislation providing enforcement of awards under the 1958 New York Convention or under the ICSID convention.

Investor-State Dispute Settlement

The government is a member state of the Multilateral Investment Guarantee Agency (MIGA).

Suriname has no BIT or FTA with an investment chapter with the United States.

There have been no publicly known investment disputes in the past 10 years involving a U.S person or other foreign investor. Every effort is made to settle investment disputes outside the court system or via arbitration.

Judgments of foreign arbitral awards are enforced by the local courts only if Suriname has a legal treaty of jurisprudence with the foreign country involved. If not, the foreign judgment can be brought before the Surinamese court for consideration as long as the court determines it has jurisdiction and doing so does not otherwise violate any Surinamese laws. With Suriname’s participation and membership in the Caribbean Court of Justice, judgments from this court are also binding for local courts. Cases have been successfully filed against Suriname before the Inter-American Court of Justice and the Organization of American States. Judgments from these courts have been upheld by the Surinamese legal system.

There is no known history of extrajudicial action against foreign investors.

International Commercial Arbitration and Foreign Courts

Suriname’s civil law includes options for arbitration. The government reactivated the Suriname Arbitration Institute (SAI) in August 2014 to offer arbitration and mediation services. The SAI collaborates with the Dutch Arbitration Institute.

The Mediation Council, pursuant to the Labor Mediation Act of 1946, promotes the peaceful settlement of disputes concerning labor issues and the prevention of such disputes in Suriname.

Local courts only recognize and enforce foreign arbitral awards if doing so is stipulated in the contract or agreement and it does not contradict local law. Foreign arbitration is an accepted means of settling disputes between private parties, but only if local alternatives are exhausted.

There have been no publicly known investment disputes in which state-owned enterprises are involved. Court processes are, in general, considered transparent and non-discriminatory.

Bankruptcy Regulations

Suriname has bankruptcy legislation. Creditors, equity shareholders, and holders of other financial contracts, including foreign contract holders, have the right to file for liquidation of debts due to insolvency. In a case where there is a loan from a commercial bank, repayment of the bank loan takes precedence. Bankruptcy, in principle, is not criminalized. However, in cases where a board of directors encouraged a company to pursue bankruptcy to avoid creditors, courts have viewed this behavior as a criminal offense. In the World Bank’s Doing Business Report, Suriname stands at 139 in the ranking of 190 economies on the ease of resolving insolvency.

Investment Incentives

Under current regulations, foreign investors can benefit from both tax and non-tax based incentives. Tax-based incentives include a nine-year tax holiday that can be extended by one year if the investment is at least $13 million; accelerated depreciation of assets; and tax consolidation. Under the Raw Minerals Act, the government grants an exemption of duties for the import of raw materials from CARICOM member countries. Exemptions are also granted in the food industry, the soft drink industry, and the fruit juice industry. In 2011, the government eliminated import duties on computers and related items. The law accords special consideration on investments exceeding $50 million and investments in the exploration and exploitation of bauxite, hydrocarbons, gold, and radioactive minerals. Large investments in the mining sector are subject to extensive negotiations between the government and investors. The government maintains the ability to grant incentives that depart from the provisions in the 2001 Investment Law, for example, incentives related to the provisions of infrastructure. The government does not have a practice of issuing guarantees or jointly financing foreign direct investment projects.

Foreign Trade Zones/Free Ports/Trade Facilitation

Suriname does not have a free trade zone ore duty free zone.

Performance and Data Localization Requirements

There are no policies that mandate hiring local employment; however, the Work Permits Act prohibits employers from employing foreigners without a work permit granted by the Ministry of Labor. Some large multinationals have specific agreements with the government mandating the hiring of local employees.

There are no policies requiring that senior management and board of directors should be Surinamese nationals.

There are no excessively onerous visa, residence, or work permit requirements inhibiting foreign investors’ mobility. Foreigners with short-term business in Suriname can apply online for an e-visa at: https://suriname.vfsevisa.com/ . Business visas require a letter of introduction from the business the applicant will be working with in Suriname. Foreigners who want to work in Suriname first need to apply for a residency permit at the Ministry of Justice and Police, after which they can apply for a work permit at the Ministry of Labor. The free movement of artists, university graduates, media workers, musicians, and athletes of CARICOM origin is arranged through CSME regulations. CSME regulations also provide for the free movement for those seeking to establish or conduct business within the community.

There are no government/authority-imposed conditions on permission to invest. In practice, large foreign investments, especially in the extractives sector, require approval from the relevant Ministry.

The government does not impose forced localization policies on foreign investors.

There are no enforcement procedures for performance requirements on investors.

The 2001 Investment Law authorizes the Minister of Finance to grant both tax and non-tax incentives for new investments and for the expansion of existing investments. Incentives for new investments are on a case-by-case basis at the discretion of the Ministry of Finance. Incentives are available for both domestic and foreign investors, but investors must apply for these incentives before the initial investment is made.

Foreign IT providers are not required to turn over source code and/or provide access to encryption.

There are no measures that prevent or unduly impede companies from freely transmitting customer or other business-related data outside the country’s territory.

There are no mechanisms used to enforce any rules on local data storage within the country.

Real Property

Interest in property is enforced. Mortgages and liens are common. Mortgages are registered with the Mortgage Office. However, no effective registration system exists for other types of liens.

Non-residents can request to lease land from the government if they have established a company under Surinamese law. However, the process from application to approval is lengthy.

The percentage of land in Suriname that lacks a clear land title remains unknown. There is no sustained effort by the government to identify property owners and register land titles. Article 1-1 of the L-1 decree, Principles of Land Policy, states that “all land, to which others have not proven their right to ownership, is domain of the State.” Furthermore, Article 41 of the Surinamese constitution states that wealth and resources are property of the nation and shall be used to promote economic, social, and cultural development. There is no effective demarcation of substantial land claims by indigenous people in the interior.

Unoccupied, legally-purchased property cannot be reverted to other owners, such as squatters.

Intellectual Property Rights

Suriname is a member of the World Trade Organization and the World Intellectual Property Organization; however, it has not ratified the Trade Related Aspects of Intellectual Property Rights (TRIPS) Agreement. Even though Suriname is party to multiple agreements, intellectual property rights (IPR) enforcement is weak. The current legal framework mentions protection of copyright, trademarks, and patents; however, that legislation dates back to 1912 (amended in 2001). Although the National Assembly passed amendments to the Music Copyright Law of 1913 in March 2015, there is no enforcement. Infringement on rights and theft are not uncommon due to the absence of enforcement capacity. There is also no protection provided for industrial designs, utility models, geographical indications, layout designs of integrated circuits or undisclosed information.

No IPR-related laws or regulations have been enacted in the past year. A draft IPR bill had been pending under the previous National Assembly (2015-2020), but it did not receive a vote. Currently, patents and copyrights must be registered abroad due to a lack of local legislation.

In 2012, the Suriname Port Unit was established to improve port security and prevent the illegal use of sea containers in drug trafficking and transnational organized criminal activities, such as trafficking in chemicals used in the manufacture of drugs (precursors), smuggling of goods (including counterfeit goods), tax evasion, and possible terrorist acts.

Suriname is not mentioned in the United States Trade Representative’s 2021 Special 301 Report , nor is it named in its 2020 Review of Notorious Markets for Counterfeiting and Piracy.

Capital Markets and Portfolio Investment

The government does not promote portfolio investment.

There is a small self-regulating stock market with eleven companies registered. It meets twice a month but does not have an electronic exchange. There is no effective regulatory system to encourage and facilitate portfolio investment. At present, Suriname is facing liquidity shortfalls. Sufficient policies do exist to facilitate the free flow of financial resources.

As an IMF Article VIII member, Suriname has agreed to refrain from restrictions on payments and transfers for current international transactions.

Credit is allocated on market terms and at market rates. Foreign investors that establish businesses in Suriname are able to get credit on the local market, usually with a payment guarantee from the parent company. The private sector has access to a variety of credit instruments. Larger companies can obtain customized credit products. There is, however, a Central Bank regulation that limits a commercial bank’s credit exposure to a single client.

Money and Banking System

The private sector has access to a variety of credit instruments. Larger companies can obtain customized credit products

According to the IMF Article IV Consultation in 2019, the banking system faces pressing vulnerabilities.

Based on the latest (July 2019) data, the capital adequacy ratio for the banking system stood at 10.5 percent (above the 10 percent minimum requirement), but non-performing loans in the banking system remained high (12.5 percent of gross loans), and profitability was low (0.7 percent return on assets). Deposit and loan dollarization remain high.

Total estimated assets of Suriname’s largest banks:

DSB Bank (annual report, 2018): $1,007 million. DSB annual report 2019 is delayed due to COVID-19 and time needed to implement IFRS.

Hakrin Bank (annual report 28, 2019): $671.2 million

Republic Bank Limited (2020 annual report, Suriname-based assets): $396.5 million. (The Republic Bank Limited of Trinidad and Tobago acquired Royal Bank of Canada’s Suriname holdings in 2015.)

Finabank (annual report, 2019): $322.8 million

Suriname has a central bank system.

Foreign banks or branches are allowed to establish operations in Suriname. They are subject to the same measures and regulations as local banks. According to an IMF assessment in 2016, banks in Suriname are among those in the region that have lost their correspondent relationships. The IMF notes that though the loss of correspondent banking relationships has not reached systemic proportions, a critical risk still exists. According to the IMF’s Article IV Consultation report in 2019, there is a possibility of losing corresponding banking relationships given recent overseas investigations of potential money laundering via Suriname’s financial sector. The reputational risk to both local and foreign banks acting as their correspondents is substantial. In March 2021, Suriname announced that it had completed a National Risk Assessment to identify and assess its vulnerability to money laundering and the financing of terrorism.

There are no restrictions for foreigners to open a bank account. Banks require U.S. citizens to provide the information necessary to comply with the Foreign Accounts Tax Compliance Act (FATCA).

Foreign Exchange and Remittances

Foreign Exchange

There are no restrictions or limitations placed on foreign investors in converting, transferring, or repatriating funds associated with an investment, such as remittances of investment capital, earnings, loan or lease payments, or royalties. There can be shortages in the availability of U.S. cash dollars at local banks, which can affect businesses.

Funds associated with any form of investment can be freely converted into a usable currency at legal market clearing rates with the permission of the Foreign Exchange Commission. However, the criteria for obtaining permissions are opaque.

In September 2020, the Central Bank of Suriname (CBvS) announced the depreciation of the Surinamese Dollar (SRD). The previous official exchange rate was SRD7.52 to $1 dollar. The new sale rate was adjusted to SRD14.29 to $1 dollar. In March 2021, the CBvS announced that it had come to an agreement with the government to establish a minimum and maximum exchange rate for the U.S. dollar, namely that the rate must stay between SRD14.29 and SRD16.30 to $1. In addition to the official exchange rate, different rates are available unofficially in parallel exchange markets. Media reports indicate that exchange rate policy is a key component of Suriname’s negotiations with the International Monetary Fund – negotiations which began in 2020.

Remittance Policies

There are no recent changes or plans to change investment remittance policies.

The waiting period on remittances can be relatively short for dividends; return on investments, interest, and principal on private foreign debt; lease payments; royalties; and management fees. The time needed to process the requests depends on the sector and the amount transferred. Transfers through the banking system can range from same day to one week waiting times, contingent upon approval by the Foreign Exchange Commission.

Sovereign Wealth Funds

On May 4, 2017, the National Assembly passed legislation establishing a Sovereign Wealth Fund (SWF). In August 2020, President Santokhi announced that the government would operationalize Suriname’s SWF, as the previous government had not instituted the necessary state decrees to do so. In December 2020, the government held talks with experts from Norway to learn more from the Norwegian Sovereign Wealth Fund.

Suriname does not participate in the International Forum of Sovereign Wealth Funds.

State owned enterprises (SOEs) operate in the oil, agribusiness, mining, communications, travel, energy, and financial sectors. SOEs provide little information regarding their operations. Only a few produce annual reports accessible to the public. Staatsolie, Suriname’s state-owned oil company, has publicly available audited accounts. As of 2020, all state-owned enterprises will be required to publish annual accounts. Several have been accused of fraud or corrupt practices. In August 2020, President Santokhi installed a Presidential Committee on the Improper Use of Public Goods. The task of the committee is to conduct an inventory of goods purchased on behalf of the government, as well as semi-governmental entities and SOEs.

There is no public list of SOEs.

SOEs receive advantages when competing in the domestic market. These include access to government guarantees and government loans otherwise unavailable to private enterprises. Additionally, SOEs have access to land and raw materials inaccessible to private entities.

The government does not yet adhere to the OECD Guidelines on Corporate Governance for SOEs.

Privatization Program

The GoS did announce a privatization program largely in the agricultural sector, but the only privatization was the state-owned banana company in 2014. The official governing accord of the ruling coalition states that privatization of SOEs will be considered where appropriate, while President Santokhi has indicated that some SOEs will need to be privatized. However, no such privatizations have taken place under the new government.

Foreign investors can participate in privatization programs. In 2014, the Belgium multinational, UNIVEG, acquired a 90 percent stake in the state-owned banana company through a public, international bidding process. The European Commission assisted with the bidding process. UNIVEG later pulled out of Suriname. The Government took over the remaining 90 percent shares and $15 million debt of UNIVEG and is now the only share holder. As this is the only example of privatization within Suriname, no standard privatization or public bidding processes have been established by the government.

There is a growing awareness of expectations of standards for responsible business conduct (RBC) among consumers and producers. Historically, Alcoa’s subsidiary, Suralco, took the lead on RBC in Suriname, and large multinationals such as Newmont continue to be the largest proponents of RBC. Some larger, state-owned and local companies also model RBC, including Staatsolie, Surinam Airways, Telesur, and the Fernandes Group of Companies, which holds the distribution rights for Coca-Cola, and the McDonalds franchise rights. In March 2020, a number of prominent local companies and business leaders established the SU4SU COVID-19 support fund, which has raised money and donated medical equipment and PPE to local health authorities to assist their efforts in combatting the COVID-19 pandemic.

The government has not taken systematic measures to encourage or promote RBC. Companies are allowed to develop their own policies and standards. The government does incorporate RBC in some of its partnerships and agreements with multinational firms. For example, recent agreements between Staatsolie and foreign companies for offshore drilling include stipulations regarding RBC. The government has no national point of contact or ombudsman for stakeholders to acquire information or raise concerns about RBC. The GOS has not conducted a National Action Plan on RBC and/or Business and Human Rights. It is not known if RBC policies are part of the government’s procurement decisions.

There are no alleged/reported human or labor rights concern related to RBC.

There have been no recent high profile controversial instances of private sector impact on human rights, though indigenous land rights in the interior is an ongoing issue.

The Labor Inspection Department from the Ministry of Labor supervises and enforces the observance of legal regulations regarding the conditions of employment and the protection of employees performing duties. Laws were enforced only in the formal sectors. Labor inspectors did not make regular occupational safety and health inspections. The government is drafting consumer and environmental protection laws. In March 2020, the National Assembly passed an Environment Framework Law.

Currently there is no legislation for corporate governance and executive compensation standards to protect shareholders. The Act on Annual Accounts will require companies to publish annual accounts based on the International Financial Reporting Standards (IFRS) starting in 2020.

The Suriname Trade and Business Association has taken the lead in promoting RBC. The Suriname Conservation Foundation initiated a Green Partnership Program in 2020 signed by 14 enterprises, 13 of which are local, to stimulate awareness about a green economy and nature preservation. So far, no incidents have been reported indicating that those monitoring and or advocating around RBC cannot work freely.

The host government has not encouraged adherence to the OECD Due Diligence Guidance for Responsible Supply Chain of Minerals from Conflict-Afflicted and High-Risk Areas. In March 2019, the government adopted legislation to join the Kimberley Process Certification Scheme in order to become a member of the World Diamond Council Association.

The host government has not encouraged adherence to the OECD Due Diligence Guidance for Responsible Supply Chain of Minerals from Conflict-Afflicted and High-Risk Areas. Suriname became a member of the Extractive Industry Transparency Initiative in 2017. There are no domestic transparency measures requiring the disclosure of payments made to governments and/or other RBC/BHR policies or practices.

Suriname is not a signatory of The Montreux Document on Private Military and Security companies, nor a supporter of the International Code of Conduct or Private Security Providers nor a participant in the International Code of Conduct for Private Security Service Providers Association (ICoCA).

Additional Resources 

Department of State

• Country Reports on Human Rights Practices;
• Trafficking in Persons Report;
• Guidance on Implementing the “UN Guiding Principles” for Transactions Linked to Foreign Government End-Users for Products or Services with Surveillance Capabilities and;
• North Korea Sanctions & Enforcement Actions Advisory

Department of Labor

• Findings on the Worst Forms of Child Labor Report;
• List of Goods Produced by Child Labor or Forced Labor.
• Sweat & Toil: Child Labor, Forced Labor, and Human Trafficking Around the World and;
• Comply Chain.

Suriname’s legal code penalizes corruption, but there is virtually no enforcement. Government officials are occasionally removed from assignments, but convictions are rare. On September 1, 2017, parliament passed anti-corruption legislation nearly 15 years after the initial draft bill was introduced to the National Assembly. An anti-corruption commission, which is mandated by the legislation, has not yet been installed. In August 2020, President Santokhi installed a Presidential committee to conduct an inventory of executive orders and determine what mechanisms need to be put in place to install an anti-corruption commission. Suriname ranks on 94 out of 180 countries on the Corruption Index of Transparency International.

Existing laws that deal with corruption do not extend to family members of officials, or to political parties.

There are currently no laws or regulations to counter conflicts of interest in awarding contracts or government procurement. The Ministry of Public Works announced that it will soon adopt stricter, but also flexible measures for transparency in tenders. Legal requirements for tenders will be examined. Non-legal requirements will be adjusted and introduced shortly. Civil servants and politicians will be prohibited from taking part in tenders.

The government does not encourage or require private companies to establish internal codes of conduct prohibiting bribery of public officials.

Local private companies do not use internal control, ethics, and compliance programs to detect and prevent bribery of government officials.

Suriname has signed and ratified the Inter-American Convention against Corruption. Suriname has not yet signed and ratified the UN Convention against Corruption. Suriname is not a party to the OECD Convention on Combatting Bribery.

There are no NGOs that focus exclusively on investigating corruption.

U.S. firms have identified corruption as an obstacle to FDI. Corruption is believed to be most pervasive in government procurement, the awarding of licenses and concessions, customs, and taxation.

Resources to Report Corruption

Fraud Department
Suriname Police Force( Korps Politie Suriname)
Havenlaan, Paramaribo, Suriname
(597) 404-943

Since the conclusion of the interior war in 1992, Suriname has not seen politically motivated violence or civil disturbance.

In July 2019, illegal goldminers damaged property at the Rosebel goldmine after the company’s security personnel fatally shot an illegal goldminer. The mine was subsequently closed for one month, and then reopened.

Although there is political polarization in Suriname, past elections were considered to be free and fair by international observers, including national elections on May 25, 2020, which brought then-opposition parties into power.

In general, both skilled and unskilled labor is available in the local market. Foreign workers are mainly active in the extractive industries and agricultural sector. Not only Haitians, but also an influx of Cubans have entered the workforce and are active in several sectors for lower wages. Documented foreign workers are protected by labor laws. According to the Statistical Bureau, the unemployment rate in 2019 was 11 percent. An estimated 15 percent of the working-age population worked in the informal economy.

Heavy equipment operators, welders, and other skilled workers in the extractive industries are in high demand. In recent years, Suriname recruited physicians and ER nurses from the Philippines to work in hospital emergency rooms. Because of the economic downturn in 2015-2016, the majority of these workers have left the country, resulting in a shortage of nurses and medical staff. Since 2005, Suriname has welcomed Cuban medical professionals on a rolling basis. In March 2020, Cuba sent 20 doctors and 30 nurses to Suriname to assist with the government’s COVID-19 response. In January 2021, the Minister of Public Health announced that approximately 40 of the almost 100 Cuban medical workers in Suriname had voluntarily agreed to return to Cuba.

There are no policies that require the hiring of nationals; however, the Work Permits Act prohibits employers from employing foreigners without a work permit granted by the Ministry of Labor.

Legislation makes it difficult for employers to respond to fluctuating market conditions. The Dismissal Permits Act prohibits employers from dismissing employees without permission from the Ministry of Labor. Collective redundancy for organizational or economic reasons is permitted in cases such as the closure or decline of a business. Generally, when an employee is laid off, unions negotiate with the employer regarding a package and duration of social benefits. Labor organizations sometimes object to work based on contracts as opposed to full time, ongoing employment.

Labor laws are not waived to attract or retain investment. As Suriname has no special economic zones, foreign trade zones, or free ports with alternative labor policies, all entities are subject to existing legislation.

Collective bargaining agreements are widespread in both the private and public sector. Data regarding the percentage of the economy covered by collective bargaining agreements is unavailable. Employees of most large multi-national firms are unionized.

Labor dispute mechanisms are in place and freely used for mediation and arbitration.

Strikes that pose an investment risk are rare.

Suriname is a member of the International Labor Organization and recognizes international labor law in its domestic legislation. In 2018, Suriname made a moderate advancement in efforts to eliminate the worst forms of child labor. The government ratified International Labor Organization Convention 138 concerning the minimum age for admission to employment, acceded to the Protocol to the Forced Labor Convention, and amended the Law on Labor for Children and Young People, raising the minimum age of work to 16 years.

In June 2019, the National Assembly adopted the family protection law regarding maternity and paternity leave. In July 2019, the National Assembly approved an update of the Minimum Wage Act which set the minimum wage at SRD 8.40 per hour, effective July 10. Every two years, starting 2020, a National Wage Board will advise on a new minimum wage to the Minister of Labor. Pending draft bills in 2020 under the previous National Assembly (2015-2020) included the Draft Working Conditions Act of 2019, the Draft Equal Treatment Act, a draft law on violence and sexual harassment, and a draft law on working hours regulation.

* Source for Host Country Data: Central Bank of Suriname

Table 3: Sources and Destination of FDI

Data not available.

Note: Suriname does not release foreign direct investment data publicly. The IMF’s Coordinated Direct Investment Survey (CDIS) has no information on Suriname. There are no tax haven sources of inward FDI.

Table 4: Sources of Portfolio Investment

Data not available.

Note: Portfolio investment data are not available in Suriname on the IMF’s Coordinated Portfolio Investment Survey. The host government does not publish portfolio investment data.

Economic Officer
U.S. Embassy Paramaribo
(597) 556-700