St. Lucia is located in the Lesser Antilles in the Eastern Caribbean (EC). St. Lucia is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU). In 2018, the country had an estimated Gross Domestic Product (GDP) of USD 1.33 billion, with a growth of 1.50 percent in 2019. Prior to the COVID-19 crisis, growth was forecasted at 3.78 percent for 2020, according to the Eastern Caribbean Central Bank (ECCB). However, the coronavirus pandemic has significantly reduced the gains that were expected to strengthen St. Lucia’s economic position in the near term. The impact of the pandemic on tourism has had ripple effects across the economy. Preliminary estimates by the International Monetary Fund (IMF) in April 2020 predicted that GDP would instead contract 8.5 percent. There has been a slight decline in the country’s debt to GDP ratio over the past three years, from 65.45 percent in 2016 to 64.28 percent in 2018. Inflation remains relatively stable at 1.55 percent. Public sector outstanding debt in 2018 was estimated at USD 1.2 million (3,342,730 million Eastern Caribbean dollars), and is expected to increase in 2020 due to government borrowing to finance pandemic response and recovery efforts.
In the 2020 World Bank’s Doing Business Report, St. Lucia ranked 93rd out of 190 countries. The report noted minimal changes from the previous report, but some improvement in the ease of starting a business.
St. Lucia attracts foreign business and investment, especially in its offshore banking and tourism industries. According to the World Travel and Tourism Council, in 2019 tourism was St. Lucia’s main economic sector, accounting for about 40 percent of GDP and formal employment. Real estate and transport are other leading sectors. The government has stated it is committed to creating a welcoming and open business climate to attract more foreign investment. Investment opportunities are focused primarily in tourism and hotel development, information and communication technology, manufacturing, international financial services, agribusiness, and creative industries.
The government of St. Lucia provides several investment incentives to encourage domestic and foreign private investment. Recent amendments to the International Business Act sought to encourage businesses to locate their head offices in St. Lucia. Foreign investors in St. Lucia can repatriate all profits, dividends, and import capital.
The St. Lucia legal system is based on the British common law system, but its civil code and property law are greatly influenced by French law. St. Lucia does not have a bilateral investment treaty with the United States but has bilateral investment treaties with the United Kingdom and Germany.
In 2014, the government of St. Lucia signed an Intergovernmental Agreement in observance of the U.S. Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in St. Lucia to report the banking information of U.S. citizens.
|Transparency International Corruption Perceptions Index||2019||55 of 180||http://www.transparency.org/
|World Bank’s Doing Business Report||2019||93 of 190||http://www.doingbusiness.org/
|Global Innovation Index||2019||N/A||https://www.globalinnovationindex.org/
|U.S. FDI in partner country (M USD, historical stock positions)||2018||394||http://apps.bea.gov/international/
|World Bank GNI per capita (M USD)||2018||9,560||http://data.worldbank.org/indicator/
1. Openness To, and Restrictions Upon, Foreign Investment
Policies Towards Foreign Direct Investment
The government of St. Lucia strongly encourages foreign direct investment (FDI). Through Invest Saint Lucia, the government introduced several investment incentives for businesses that consider locating in St. Lucia, encouraging both domestic and foreign private investment. Invest Saint Lucia provides “one-stop shop” facilitation services to investors, helping to guide them through the various stages of the investment process.
Applicable government agencies, rather than Invest Saint Lucia, grant investment concessions. Invest Saint Lucia is overseen by the Minister in the Office of the Prime Minister with responsibility for Commerce, International Trade, Investment, Enterprise Development and Consumer Affairs. Government policies provide liberal tax holidays, a waiver of import duty on imported plant machinery and equipment and imported raw and packaging materials, and export allowance or tax relief on export earnings. Various laws provide fiscal incentives to encourage establishing and expanding foreign and domestic investment. Invest Saint Lucia also provides investment promotion services.
The St. Lucian government encourages investment in all sectors, but targeted sectors include tourism, smart manufacturing and infrastructure, information and communication technologies, alternative energy, education, and business/knowledge processing operations.
Limits on Foreign Control and Right to Private Ownership and Establishment
There is no limit on the amount of foreign ownership or control in the establishment of a business in St. Lucia. The government allows 100 percent foreign ownership of companies in any sector. Currently, there are no restrictions on foreign investors investing in military or security-related businesses or natural resources. However, Invest Saint Lucia assesses investment proposals for viability and in accordance with the laws of St. Lucia. Trade licenses and other approvals/licenses may be required before establishment.
Invest Saint Lucia evaluates all FDI proposals and provides intelligence, business facilitation, and investment promotion to establish and expand profitable business enterprises in St. Lucia. Invest Saint Lucia also advises the government on issues that are important to the private sector and potential investors and advocates for an improved business climate, growth in investment opportunities, and improvements in the international competitiveness of the local economy. They focus on building and promoting St. Lucia as an ideal location for investors, seeking and generating new investment in strategic sectors, facilitating domestic and foreign direct investment as a one stop shop for investors, and identifying major issues and measures geared towards assisting the government in the ongoing development of a National Investment Policy.
The government of St. Lucia treats foreign and local investors equally with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.
Other Investment Policy Reviews
St. Lucia, as a member state of the OECS, has not conducted a trade policy review in the last three years.
Invest Saint Lucia is the main business facilitation unit for potential investors into St. Lucia. It facilitates FDI in priority sectors and advises the government on the formation and implementation of policies and programs to attract investment. Invest Saint Lucia provides business support services and market intelligence to all investors. All potential investors applying for government incentives must submit their proposals for review by Invest Saint Lucia to ensure the projects are consistent with the national interest and provide economic benefits to the country. Invest Saint Lucia offers an online resource that is useful for navigating the laws, rules, procedures and registration requirements for foreign investors. It is available at .
The Registry of Companies and Intellectual Property office maintains an e-filing portal for most of its services, including company registration. Relevant officials can review applications submitted electronically. However, applicants must pay the registration fee at the Registry office. The Registry of Companies and Intellectual Property office can only accept payment in the form of cash and checks. Personal checks are not accepted. It is advisable to consult a local attorney prior to starting the process. Further information is available at .
According to the World Bank Doing Business Report for 2020, St. Lucia ranked 69 out of 190 countries in the ease of starting a business. The general practice for starting a business is to retain an attorney to prepare all incorporation documents. A business must register with the Registry of Companies and Intellectual Property Office, the Inland Revenue Authority, and the National Insurance Corporation. The government of St. Lucia continues to support the growth of women–led businesses. The government seeks to support equitable treatment of women in the private sector through non-discriminatory processes for business registration, awarding of fiscal incentives, and assessing investments.
In 2018, the government of St. Lucia embarked on a disability assessment, funded by the Caribbean Development Bank, to support the full participation of people with disabilities in the society and the economy. Among other objectives, the assessment seeks to provide data about the engagement of people with disabilities in society and to ensure the equal participation of people with disabilities in the formal and informal sectors of the economy.
The government of St. Lucia prioritizes investment retention as a key component of its overall economic strategy. While the government of St. Lucia is encouraging more domestic savings, it continues to require significant foreign investment to fill the investment gap.
There is no restriction on domestic investors seeking to do business abroad. Local companies in St. Lucia are actively encouraged to take advantage of export opportunities specifically related to the country’s membership in the OECS Economic Union and the Caribbean Community Single Market and Economy (CSME), which enhance the competitiveness of the local and regional private sectors across traditional and emerging high-potential markets.
5. Protection of Property Rights
Civil law protects physical property and mortgage claims. There are some special license requirements pertaining to acquisition of land, development of buildings, and expansion of existing construction, and special standards for various aspects of the tourism industry. Individuals or corporate bodies who are not CARICOM nationals and who seek to acquire land must apply for and obtain an alien landholder’s license as required under the Alien Landholding Act prior to acquisition.
In the 2020 World Bank Doing Business Report, St. Lucia ranked 107th out of 190 countries in the ease of registering property, compared to 104th in 2019. It takes about 17 days to complete the necessary procedures, at a cost of about 7.2 percent of the property value.
Intellectual Property Rights
St. Lucia has two primary provisions governing the protection of intellectual property rights. They are the copyrights act and the trademarks act.
This Act protects literary, dramatic, musical, artistic, creative products, and performances in St. Lucia. To be eligible for copyright protection, the work must be written down, recorded or otherwise fixed in a material form. Storage of the work in a computer can be regarded as a recording of the work in a material form.
A trademark may be registered for goods, services or both. Once registered, the owner has the exclusive rights to use the trademark, authorize its use by another person, and obtain relief under the Act if the holder’s rights have been violated. A registered trademark is deemed personal property and is enforceable like the rights of personal property.
While the legal structures governing intellectual property are generally strong, enforcement is inconsistent. The Attorney General is responsible for administering intellectual property laws. The Registry of Companies and Intellectual Property Office administers the registration of patents, trademarks, and service marks.
St. Lucia is a signatory to the Washington Treaty on Intellectual Property in Respect of Integrated Circuits, the World Intellectual Property Organization (WIPO) Performances and Phonograms Treaty, the WIPO Copyright Treaty, the Vienna Agreement Establishing an International Classification of the Figurative Elements of Marks, and the Convention for the Protection of Producers of Phonograms Against Unauthorized Duplication of Their Phonograms. St. Lucia is also a signatory to the Nice Agreement Concerning the International Classification of Goods and Services for the Purposes of the Registration of Marks, the Patent Cooperation Treaty, the Rome Convention for the Protection of Performers, and Producers of Phonograms and Broadcasting Organization. In addition, St. Lucia has signed the Paris Convention for the Protection of Industrial Property, the Berne Convention for the Protection of Literary and Artistic Works, and the Convention Establishing the World Intellectual Property Organization.
Article 66 of the Revised Treaty of Chaguaramas (2001) establishing the CSME commits all 15 members to implement stronger intellectual property protection and enforcement. The CARIFORUM-EU EPA contains the most detailed obligations with respect to intellectual property in any trade agreement to which St. Lucia is a party. The EPA gives recognition to the protection and enforcement of intellectual property. Article 139 of the EPA requires parties to “ensure an adequate and effective implementation of the international treaties dealing with intellectual property to which they are parties and of the Agreement on Trade Related Aspects of Intellectual Property (TRIPS).”
The Comptroller of Customs spearheads the preventative and enforcement aspects of intellectual property rights protection, which includes the detention, seizure, and forfeiture of counterfeit goods. The Customs and Excise Department conducts investigations of customs offenses and administers fines and penalties.
St. Lucia is not listed on the U.S. Trade Representative’s (USTR’s) 2018 Out-Of-Cycle Review of Notorious Markets or in the 2019 Special 301 Report. For additional information about treaty obligations and points of contact at local intellectual property offices, please see WIPO’s country profiles at .
6. Financial Sector
Capital Markets and Portfolio Investment
St. Lucia is a member of the ECCU. As such, it is a member of the Eastern Caribbean Securities Exchange (ECSE) and the Regional Government Securities Market. The ECSE is a regional securities market established by the ECCB and licensed under the Securities Act of 2001, a uniform regional body of legislation governing the securities market. St. Lucia is a member of this stock exchange.
The government of Saint Lucia remained the market leader in the financial year, raising USD 496.2 million from the auctions of 15 Treasury bills and four bonds, which represents an increase of USD 90.0 million, 22.2 percent from the amount raised in 2018. The Government of Saint Lucia’s activity accounted for 34.5 percent of the number of auctions and 38.4 percent of the overall regional government securities market (RGSM) proceeds.
St. Lucia has accepted the obligations of Article VIII of the International Monetary Fund Agreement, Sections 2, 3 and 4 and maintains an exchange system free of restrictions on making payments and transfers for current international transactions. Foreign tax credit is allowed for the lesser of the tax payable in the foreign country or the tax charged under St. Lucia tax law. The private sector has access to credit on the local market through loans, purchases of non-equity securities, and trade credits and other accounts receivable that establish a claim for repayment.
Money and Banking System
The eight participating governments of the ECCU have passed the Eastern Caribbean Central Bank Agreement Act. The Act provides for the establishment of the ECCB, its management and administration, its currency, relations with financial institutions, relations with the participating governments, foreign exchange operations, external reserves, and other related matters. St. Lucia is a signatory to this agreement and the ECCB controls St. Lucia’s currency and regulates its domestic banks.
The Banking Act is a harmonized piece of legislation across the ECCU. The Minister of Finance usually acts in consultation with, and on the recommendation of, the ECCB with respect to those areas of responsibility within the Minister of Finance’s portfolio.
Domestic and foreign banks can establish operations in St. Lucia. The Banking Act requires all commercial banks and other institutions to be licensed in order to conduct any banking business. The ECCB regulates financial institutions. As part of ongoing supervision, licensed financial institutions are required to submit monthly, quarterly, and annual performance reports to the ECCB.
The ECCB annual economic report stated that the banking system in St. Lucia recorded USD 308.409 million (USD 833.3 million Eastern Caribbean dollars) in net foreign assets at the end of 2018, up from USD 219.954 million (USD 594.3 Eastern Caribbean dollars) one year earlier. Liquidity in the commercial banking system improved during 2018, which was the most recently published report. At the end of December, the ratio of liquid assets to short-term liabilities stood at 42 percent, which was above the recommended minimum, and about 2.9 percentage points higher than the level recorded at the end of 2017.
St. Lucia is well-served by bank and non-bank financial institutions. There are minimal alternative financial services. Some citizens still participate in informal community group lending.
The Caribbean region has witnessed a withdrawal of correspondent banking services by U.S. and European banks. CARICOM remains committed to engaging with key stakeholders on the issue and appointed a Committee of Ministers of Finance on Correspondent Banking to monitor the issue.
Foreign Exchange and Remittances
St. Lucia is a member of the ECCU and the ECCB. The currency of exchange is the Eastern Caribbean dollar (XCD). St. Lucia has a fully liberalized foreign exchange system. The Eastern Caribbean dollar has been pegged to the United States dollar at a rate of XCD 2.70 to USD 1.00 since 1976. As a result, the Eastern Caribbean dollar does not fluctuate, creating a stable currency environment for trade and investment in St. Lucia.
There are no restrictions or limitations placed on foreign investors in converting, transferring, or repatriating funds associated with an investment. Funds can also be freely converted into any of the major world currencies.
Companies registered in St. Lucia have the right to repatriate all capital, royalties, dividends, and profits. There are no restrictions on the repatriation of dividends for totally foreign-owned firms.
As a member of the OECS, there are no exchange controls in St. Lucia, and parties can invoice foreign trade transactions in any currency. Importers are not required to make prior deposits in local funds and are not required to surrender export proceeds to government authorities or to authorized banks. There are no controls on transfers of funds. St. Lucia is a member of the Caribbean Financial Action Task Force (CFATF).
Sovereign Wealth Funds
Neither the government of St. Lucia, nor the ECCB, of which St. Lucia is a member, maintains a sovereign wealth fund.
Most locals and foreigners do not view corruption related to foreign business and investment as a major problem in St. Lucia. However, there are isolated reports of allegations of official corruption, particularly among customs officials. Local laws provide for access to information. The law also requires government officials to present their financial assets annually to the Integrity Commission. While authorities do not make public the disclosure reports filed by individuals, the commission submits a report to parliament each year. The commission lacked the ability to compel compliance with the law, and as a result, compliance was low.
The Parliamentary Commissioner, Auditor General, and Public Services Commission are responsible for combating corruption. Parliament can also appoint a special committee to investigate specific allegations of corruption. The country is a party to the Inter-American Convention against Corruption and acceded to the United Nations Convention against Corruption in 2011. St. Lucia ranked 55 out of 180 countries in the 2018 and 2019 Transparency International Corruption Index.
St. Lucia has laws, regulations, and penalties to combat corruption, notably the Integrity in Public Life Act of 2004. However, while the law provides criminal penalties for official corruption, enforcement is not always effective. Government agencies involved in enforcement of anti-corruption laws include the Royal St. Lucia Police Force, the Director of Public Prosecutions, the Integrity Commission, and the Financial Intelligence Unit.
In June 2015, twelve Commonwealth Caribbean countries including St. Lucia established a regional body to enhance transparency and to help fight corruption. The Association of Integrity Commissions and Anti-Corruption Bodies in the Commonwealth Caribbean supports regional efforts to promote integrity and address corruption.
Resources to Report Corruption
Contact at the government agency or agencies that are responsible for combating corruption:
Pastor Sherwin Griffith
2nd Floor, Graham Louisy Administrative Building,
Waterfront Castries, Saint Lucia
Financial Intelligence Authority
Gablewoods North P.O.
Castries LC02 501, Saint Lucia
10. Political and Security Environment
St. Lucia is considered politically stable and does not have a recent history of political violence. Elections are peaceful and considered generally free and transparent. The next election is constitutionally due in June 2021.
13. Foreign Direct Investment and Foreign Portfolio Investment Statistics
Table 3: Sources and Destination of FDI
Data not available.
Table 4: Sources of Portfolio Investment
Data not available.