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Antigua and Barbuda

Executive Summary

Antigua and Barbuda is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU). According to Eastern Caribbean Central Bank (ECCB) statistics, Antigua and Barbuda’s 2020 estimated gross domestic product (GDP) was $1.38 billion (3.73 billion Eastern Caribbean dollars). This represents an approximate 18 percent drop from 2019 due to the impact of COVID-19 on the country’s tourism-dependent economy. Short-term forecasts project a sluggish recovery throughout 2021, with the country not projected to return to pre-pandemic levels of growth and tourism until 2024. The economy might struggle to hit its forecasted growth of around 3.4 percent in 2021, and in fact may contract by an additional 10 percent.

Unanticipated spending on pandemic response measures, coupled with sharp declines in government revenues, forced the government to increase borrowing in 2020. The country’s debt-to-GDP ratio rose from 67 percent at the end of 2019 to 89 percent at the end of 2020. Unlike other Eastern Caribbean (EC) countries, Antigua and Barbuda has not significantly increased spending on social support payments to vulnerable populations. The government became the sole source of financing for regional airline Leeward Islands Air Transport (LIAT) in mid-2020. Based in Antigua and Barbuda, LIAT was a major employer but is now under the supervision of a bankruptcy trustee.

Antigua and Barbuda ranks 113th out of 190 countries rated in the 2020 World Bank Doing Business Report. The scores remain relatively unchanged from the 2019 report, though some improvements in the ease of starting a business were highlighted.

The government encourages foreign direct investment, particularly in industries that create jobs and earn foreign exchange. Through the Antigua and Barbuda Investment Authority (ABIA), the government facilitates and supports foreign direct investment in the country and maintains an open dialogue with current and potential investors. All potential investors are afforded the same level of business facilitation services.

While the government welcomes all foreign direct investment, tourism and related services, manufacturing, agriculture and fisheries, information and communication technologies, business process outsourcing, financial services, health and wellness services, creative industries, education, yachting and marine services, real estate, and renewable energy have been identified by the government as priority investment areas. Uncertainty about the trajectory of economic recovery of the tourism, commercial aviation, and cruise industries impacts the potential for projects in those sectors.

There are no limits on foreign control of investment and ownership in Antigua and Barbuda. Foreign investors may hold up to 100 percent of an investment.

Antigua and Barbuda’s legal system is based on British common law. There is currently an unresolved dispute regarding the alleged expropriation of an American-owned property. For this reason, the U.S. government recommends continued caution when investing in real estate in Antigua and Barbuda.

In 2017, the government signed an intergovernmental agreement in observance of the U.S. Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in Antigua and Barbuda to report the banking information of U.S. citizens.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index N/A N/A http://www.transparency.org/research/cpi/overview 
World Bank’s Doing Business Report 2020 113 of 190 http://www.doingbusiness.org/en/rankings 
Global Innovation Index N/A N/A https://www.globalinnovationindex.org/analysis-indicator 
U.S. FDI in partner country ($M USD, historical stock positions) 2019 7.0 https://apps.bea.gov/international/factsheet/ 
World Bank GNI per capita 2019 16,600 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD 

1. Openness To, and Restrictions Upon, Foreign Investment

Policies Towards Foreign Direct Investment

The government of Antigua and Barbuda encourages foreign direct investment, particularly in industries that create jobs, enhance economic activity, earn foreign currency, and have a positive impact on its citizens. Diversification of the economy remains a priority.

Through the ABIA, the government facilitates and supports foreign direct investment in the country and maintains an open dialogue with current and potential investors. All potential investors are afforded the same level of business facilitation services. ABIA offers complementary support services to investors exploring business opportunities, including facilitation of incentives and concessions, project monitoring, and general assistance. ABIA’s website is http://investantiguabarbuda.org . The government launched an additional website in early 2021 to serve as a “business hub for potential investors,” http://antiguabarbuda.com .

While the government welcomes all foreign direct investment, it has identified tourism and related services, manufacturing, agriculture and fisheries, information and communication technologies, business process outsourcing, financial services, health and wellness services, creative industries, education, yachting and marine services, real estate, and renewable energy as priority investment areas. Uncertainty about the trajectory of economic recovery of the tourism, commercial aviation, and cruise industries impacts the potential for projects in those sectors.

Limits on Foreign Control and Right to Private Ownership and Establishment

There are no limits on foreign control of investment and ownership in Antigua and Barbuda. Foreign investors may hold up to 100 percent of an investment, and a local or foreign entrepreneur needs about 40 days from start to finish to transfer the title on a piece of property. In 1995, the government established a permanent residency program to encourage high-net-worth individuals to establish residency in Antigua and Barbuda for up to three years. As residents, their income is free of local taxation. In 2020, the government established the Nomad Digital Residence Visa program in which eligible remote workers can apply for a two-year special resident authorization. These programs are separate from the Citizenship by Investment (CBI) program.

The ABIA evaluates all foreign direct investment proposals applying for government incentives and provides intelligence, business facilitation, and investment promotion to establish and expand profitable business enterprises. The ABIA also advises the government on issues that are important to the private sector and potential investors to increase the international competitiveness of the local economy.

The government of Antigua and Barbuda treats foreign and local investors equally with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.

Other Investment Policy Reviews

The OECS, of which Antigua and Barbuda is a member, has not conducted a trade policy review in the last three years.

Business Facilitation

Established in 2006, the ABIA facilitates foreign direct investment in priority sectors and advises the government on the formation and implementation of policies and programs to attract investment. The ABIA provides business support services and market intelligence to all investors. Its website is http://investantiguabarbuda.org . It also offers an online guide that is useful for navigating the laws, rules, procedures, and registration requirements for foreign investors. The guide is available at http://www.theiguides.org/public-docs/guides/antiguabarbuda .

All potential investors applying for government incentives must submit their proposals for review by the ABIA to ensure the project is consistent with national interests and provides economic benefits to the country.

In the World Bank’s 2020 Doing Business Report, Antigua and Barbuda ranked 130th out of 190 in the ease of starting a business. The establishment of a new business takes nine procedures and 19 days to complete. This time was reduced by three days because the government made improvements to the exchange of information between public entities involved in company incorporation. The general practice is to retain a local attorney who prepares all the relevant incorporation documents. A business must register with the Intellectual Property and Commercial Office (IPCO), the Inland Revenue Department, the Medical Benefits Scheme, the Social Security Scheme, and the Board of Education.

The Antigua and Barbuda Science Innovation Park (ABSIP) launched in 2019 to support and create business startup opportunities that will generate sustainable business enterprises. ABSIP provides business incubation and financing, access to business financing, branding, training, partnership establishment, and other services. ABSIP’s website is http://absip.gov.ag .

The Prime Minister’s Entrepreneurial Development Programme (EDP) supports the creation of micro and small businesses with the intent of increasing the Antiguan and Barbudan ownership share of the country’s economy. Priority sectors in which EDP grants loans are agriculture and agroprocessing, manufacturing, information technology, e-business, and tourism.

Outward Investment

Although the government of Antigua and Barbuda prioritizes investment return as a key component of its overall economic strategy, there are no formal mechanisms in place to achieve this. To sustain future economic growth, Antigua and Barbuda’s economy depends on significant foreign direct investment.

There is no restriction on domestic investors seeking to do business abroad. Local companies in Antigua and Barbuda are actively encouraged to take advantage of export opportunities specifically related to the country’s membership in the OECS Economic Union and the Caribbean Community Single Market and Economy (CSME).

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data: BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $1,660 2019 1,662 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data: BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 7 BEA data available at
https://apps.bea.gov/
international/factsheet/
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2019 3 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2019 8 UNCTAD data available at
https://stats.unctad.org/handbook/
EconomicTrends/Fdi.html
* Source for Host Country Data: Eastern Caribbean Central Bank https://www.eccb-centralbank.org/statistics/dashboard-datas/ 

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

Table 4: Sources of Portfolio Investment
Data not available.

Bahamas

Executive Summary

The Commonwealth of The Bahamas is a 760-mile-long archipelago stretching from the south-east coast of Florida to the north-west coast of Haiti. Despite historical and cultural similarities with many Caribbean countries, The Bahamas is actually in the North Atlantic Ocean. Only 29 of its 700 islands are occupied, with the majority of the population clustered around the two largest cities of Nassau and Freeport. The country maintains a stable environment for investment with a long tradition of parliamentary democracy, respect for the rule of law, and a well-developed legal system. Bahamians’ use of English and frequent travel to the U.S. contribute to their familiarity and preference for U.S. goods and services. The Bahamas is a developed country with an educated populace and high per capita GDP of $34,864. The Bahamas relies primarily on imports from the United States to satisfy its fuel and food needs and conducts more than 85 percent of its international trade with the United States. U. S. exports to The Bahamas were valued at $3.01 billion in 2020, resulting in a trade surplus of $2.9 billion in the United States’ favor.

The Free National Movement (FNM) government, elected in May 2017, has sought to manage an economy dealing with the dual, unprecedented economic crises wrought by the passage of Hurricane Dorian in September 2019 and the global COVID-19 pandemic. According to Standard & Poors November 2020 forecasts, The Bahamas’ GDP growth is expected to fall by a 21 percent in 2020, a loss of more than $2 billion compared to 2018’s real GDP of $10.8 billion. Full economic recovery is not anticipated until 2022, subject primarily to the buoyancy of the tourism sector and post-pandemic economic recovery. Both the International Monetary Fund (IMF) and the Inter-American Development Bank (IDB) predict The Bahamas could suffer the most severe economic contraction of all Caribbean countries.

With few natural resources and a limited industrial sector, the Bahamian economy is heavily dependent on tourism and, to a lesser degree, financial services. These sectors have traditionally attracted the majority of foreign direct investment (FDI). Tourism contributes over 50 percent of the country’s GDP and employs just over half of the workforce. Prior to the COVID-19 pandemic, more than seven million tourists, mostly American, visited the country annually. The plummet in tourism has deprived the country of its main source of revenue, and efforts to reopen hotels, resorts, restaurants, and other tourism infrastructure have been stymied by the ongoing pandemic.

The COVID-19 pandemic has reignited questions about the country’s dependence on tourism and vulnerability to external shocks, leading to calls for economic diversification and other sources of foreign exchange. The government and private sector have identified areas for development and investment, including light manufacturing, technology, agriculture and fisheries, extractive industries, and renewable energy.  The government has also committed to digitizing its business services and jumpstarting domestic productivity through small and medium enterprises, especially those operating in non-traditional sectors.

The Bahamas maintains an open investment climate and promotes a liberal tax environment and freedom from many types of taxes, including capital gains, inheritance, and corporate and personal income tax. The Bahamas does not offer export subsidies, engage in trade-distorting practices, or maintain a local content requirement, but foreign capital investments must meet a $500,000-dollar minimum before being allowed into the country. The country continues to attract FDI from various parts of the world and has recently benefitted from significant investments in the tourism sector from international companies based in China. Investments from the United States are also primarily in the tourism sector and range from general services to million-dollar private homes and billion-dollar resort developments. U.S. companies have also shown interest in emerging sectors, such as non-oil energy, renewable energy, niche tourism, and digital technology.

Positive aspects of The Bahamas’ investment climate include political stability, a parliamentary democracy, an English-speaking labor force, a profitable financial services infrastructure, established rule of law, general respect for contracts, an independent judicial system, and strong purchasing power with a high per-capita GDP. Negative aspects include a lack of transparency in government procurement, labor shortages in certain sectors, high labor costs, a bureaucratic and inefficient investment approvals process, time consuming resolution of legal disputes, internet connectivity issues, and high energy costs. The price of electricity averages four times higher than in the United States and is driven by antiquated generation systems and a dependence on inefficient fossil-fueled power plants. To remedy energy sector deficiencies, the current government has prioritized infrastructure projects focused on non-oil energy, including a liquid natural gas (LNG) plant and various solar projects; however, the LNG plant is stuck in multi-year negotiations.

Another barrier to investment in the country is the prohibition of foreign investment in 15 sectors of the economy without prior approval from the National Economic Council (NEC). These sectors include commercial fishing, public transport, advertising, retail operations, security services, and real estate agencies, among others. In 2018, the government set a goal of accession to the WTO by the end of 2019, which would require opening at least some of these protected sectors to foreign investment. However, the government later confirmed it was unlikely accession would take place before 2025.

The absence of transparent investment procedures and legislation is also problematic. U.S. and Bahamian companies alike report the resolution of business disputes often takes years and debt collection can be difficult even after court judgments. Companies also describe the approval process for FDI and work permits as cumbersome and time-consuming. The Bahamian government does not have modern procurement legislation and companies have complained the tender process for public contracts is not consistent, and that it is difficult to obtain information on the status of bids. In response, the current government passed a Public Procurement Bill and launched an e-procurement and suppliers registry system to increase levels of accountability and transparency. The Public Procurement Bill was passed in March 2021, but has not yet been fully enacted.

The Bahamas scored 63 out of 100 in Transparency International’s Corruption Perception Index in 2020 (where zero is perceived as highly corrupt and 100 is very transparent). This means The Bahamas is perceived as notably transparent when compared to the 180 countries ranked. However, the country’s scores have dropped eight points since 2012, perhaps indicating an erosion of transparency. The Bahamas still lacks an Office of the Ombudsman to strengthen access to information, nor has it fully enacted its Freedom of Information Act (2017) or appointed an independent Information Commissioner. Although the current government is pursuing legislative reforms to strengthen investment policies, progress on these efforts has been mixed.

Despite its World Bank designation as a high-income country, income inequality is higher in The Bahamas than in other Caribbean countries. This is in part due to The Bahamas’ popularity among wealthy foreigners as a convenient and attractive location to purchase a second home. These privileged, gated communities do not reflect reality for most Bahamians, especially those on less developed islands. The country grapples with high crime, unemployment, and xenophobia directed at irregular migrants from elsewhere in the Caribbean, especially Haiti. Conservative and patriarchal norms sometimes lead to inequality of opportunity, notably for women and migrant children. Women have raised concerns regarding bureaucratic hurdles to register businesses, and difficulty in securing financing. The Small Business Development Centre (SBDC) has made economic empowerment of women entrepreneurs and lessoning the income gap priorities.

Table 1
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2020 63 of 100 http://www.transparency.org/research/cpi/overview 
World Bank’s Doing Business Report “Ease of Doing Business” 2020 119 of 190 http://www.doingbusiness.org/rankings 
Global Innovation Index 2020 N/A https://www.globalinnovationindex.org/analysis-indicator 
U.S. FDI in partner country (M USD, stock positions) 2018 17.609 https://apps.bea.gov/international/factsheet/factsheet.cfm?Area=250&UUID=aa8d34cd-4c30-485d-aa74-1656d2ff9eed 
World Bank GNI per capita 2019 33,460 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD 

1. Openness To, and Restrictions Upon, Foreign Investment

Policies towards Foreign Direct Investment

The government encourages FDI, particularly in the tourism and financial services sector. The National Investment Policy (NIP) and the Commercial Enterprises Act (CEA) explicitly encourage foreign investment in certain sectors of the economy: touristic resorts; upscale villas, condominium, timeshare, and second home development; international business centers; aircraft and maritime services; marinas; information and data processing; information technology services; light industry manufacturing and assembly; agro-industries; mari-culture; food and beverage processing; banking and other financial services; offshore medical centers and services; e-commerce; arbitration; international arbitrage; computer programming; software design and writing; bioinformatics and analytics; and data storage and warehousing.

The Bahamas has an investment promotion strategy that includes multiple government agencies working to attract foreign direct investment. The Bahamas Investment Authority (BIA) ( www.bahamas.gov.bs/bia ) takes the lead on administering investment policies, functions as the investment facilitation agency, and acts as a ‘one stop shop’ to assist investors in navigating the cumbersome approvals process. All foreign investors must apply for approval from the BIA. Each administration has consistently supported new investment and has generally honored agreements made by previous administrations. The current government has introduced policies and legislative support for Small and Medium Enterprises (which represent 85 percent of registered businesses), and in 2018 launched the Small Business Development Centre (SBDC). The SBDC provides business advisory services, training, professional development opportunities, incubation services, access to capital, and advocacy for individual businesses. In response to the pandemic and to create opportunities for Bahamian entrepreneurs, the government earmarked $250 million in 2020 for loans and grants over five years to local small and medium enterprises.

The Bahamas reserves certain sectors of the economy for Bahamian investors. The reserved areas are: wholesale and retail operations (although international investors may engage in the wholesale distribution of any product they produce locally); agencies engaged in import or export; real estate agencies and domestic property management; domestic newspapers and magazine publications; domestic advertising and public relations firms; nightclubs and restaurants except specialty, gourmet, and ethnic restaurants, and those operating in a hotel, resort or tourist attraction; security services; domestic distribution of building supplies; construction companies except for special structures requiring foreign expertise; personal cosmetic or beauty establishments; commercial fishing including both deep water fishing and shallow water fishing of crustaceans, mollusks, fish, and sponges; auto and appliance services; public transportation including boat charters; and domestic gaming. The government does make exceptions to this policy on a case-by-case basis, and the Embassy is aware of several cases in which the Bahamian government has granted foreign investors full market access.

With the exception of these sectors, the Bahamian government does not give preferential treatment to investors based on nationality, and investors have equal access to incentives, which include land grants, tax concessions, and direct marketing and budgetary support. The government provides guidelines for investment through the National Investment Policy (NIP), administered by the BIA, and through the Commercial Enterprises Act (CEA) administered by the Ministry of Financial Services, Trade & Industry and Immigration. The CEA provides incentives to domestic and foreign investors to establish specific investment projects, including approval of a specified number of work permits for senior posts and the expedited issuance of work permits.

Large foreign investment projects, particularly those that require environmental and economic impact assessments, require approval by the National Economic Council (NEC) of The Bahamas. This process generally requires review by multiple government agencies prior to NEC consideration. Bureaucratic impediments are not limited to the NEC approvals process, and the country continues to lag on international metrics related to starting a business. According to the 2020 World Bank Doing Business rankings, The Bahamas scores 119 out of 190 countries overall, 181 in registering property, 77 in getting construction permits, 152 in access to credit, and 71 in resolving insolvency. All these categories saw a decrease in ratings from 2019 metrics, with the exception of getting construction permits. The Embassy is aware of cases of significant delays in the approvals process, including cases where the Bahamian government failed to respond to investment applications. Despite bureaucratic challenges and the impact of COVID-19, investment continues in tourism, finance, construction, and fast-food franchises.

In response to the losses from Hurricane Dorian and the economic fallout from COVID-19, the government announced efforts to accelerate FDI, including liberalization of requirements for investment and accelerating the review process for proposals. In April 2020, the government also appointed an Economic Recovery Committee (ERC) – a public-private coalition to develop recommendations for government policies to addresses the economic impact of the COVID-19 pandemic. The ERC’s full report can be accessed via https://opm.gov.bs/economic-recovery-committee-executive-summary-report-2020/ .

The ERC’s nearly two dozen recommendations were intended to transform the Bahamian investment regime, remove structural impediments, and incentivize domestic and foreign investment. The government accepted certain recommendations, including the establishment of an entrepreneur visa for persons wishing to work or study from The Bahamas for one year ( www.bahamasbeats.com ), limiting approvals for projects under $10 million, creating special economic zones on lesser developed islands, and establishing an autonomous agency to oversee a modern investment regime (INVESTBAHAMAS). With this new agency in place, bureaucratic delays, functionality and transparency are expected to improve. The agency will reportedly give priority to high-tech financial products, biotechnology, renewable energy investments, and climate adaptability projects. INVESTBAHAMAS remains in the planning stages.

Limits on Foreign Control and Right to Private Ownership and Establishment

Foreign investors have the right to establish private enterprises and, after approval, most companies operate unencumbered. Key considerations for approval include economic impact, job creation, infrastructural development, economic diversification, environmental protection and corporate social responsibility. With the assistance of a local attorney, investors can create the following types of businesses: sole proprietorship, limited or general partnership, joint stock company, or subsidiary of a foreign company. The most popular all-purpose vehicles for foreign investors are the International Business Company (IBC) and the Limited Duration Company (LDC). Both benefit from income, capital gains, gift, estate, inheritance, and succession tax exemptions. Investors are required to establish a local company and be registered to operate in The Bahamas.

Other Investment Policy Reviews

The Bahamas ranks 119 out of 190 countries in terms of “ease of doing business” in the 2020 World Bank Doing Business Report. See http://doingbusiness.org/rankings . The Bahamas is the only Western Hemisphere country not in the WTO, and therefore has never benefitted from a WTO trade policy review. The current government launched accession negotiations with the WTO in April 2019, initially announcing the goal of full membership later the same year. However, the government later described the 2019 target as purely aspirational, confirming it was unlikely accession would take place before 2025. A vocal domestic constituency opposes WTO accession on the grounds that membership will hurt domestic producers and service providers.

Neither the OECD nor UNCTAD have conducted investment policy reviews. The Bahamas achieved the G-20 standard on transparency and cooperation on tax matters, a standard initially advanced by the OECD.

Business Facilitation

According to the 2020 World Bank Doing Business Index, starting a business in The Bahamas takes 12 days, requires seven procedures, and costs the same for both men and women. In 2017, the Bahamian government streamlined this process and launched an e-business portal, which allowed companies to apply for or renew their business licenses online ( http://inlandrevenue.finance.gov.bs/business-licence/copy-applying-b-l/ ).

In 2020, as part of the business license application process, the government expanded provisional licenses for many small, domestic businesses so the majority would be able to start operations while awaiting formal approval. The government also removed the fee for starting a new business and renewed business licenses in under 48 hours. Foreign companies and most larger businesses are not eligible for provisional licenses, expedited renewals, or new business license fee exemptions.

All companies with an annual turnover of $100,000 or more are required to register with the government to receive a Tax Identification Number and a Value Added Tax Certificate. The lengthy registration processes are generally viewed as an impediment to the ease of doing business.

Outward Investment

The Bahamian government neither promotes nor prohibits its citizens from investing internationally, however, all outward direct investments by residents require the prior approval of the Exchange Control Department of the Central Bank of The Bahamas ( https://www.centralbankbahamas.com/exchange-control-notes-and-guidelines ). Applications are considered in light of the probable impact the investments may have on The Bahamas’ balance of payments, specifically business activities that promote the receipt of foreign currency.

12. U.S. International Development Finance Corporation (DFC) and Other Investment Insurance and Development Finance Programs

The Bahamas is a member of the Multilateral Investment Guarantee Agency of the World Bank (MIGA), which insures investors against currency transfer restrictions, expropriation, war, civil disturbances, and breach of contract by member countries. Because the World Bank designates The Bahamas as a high-income country, it generally does not qualify for development assistance.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source USG or international statistical source USG or International Source of Data: BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) (M USD) 2020 N/A 2019 13,579 https://data.worldbank.org/
country/bahamas 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data: BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country (M USD, stock positions) 2020 N/A 2019 17,609 BEA data available at
https://apps.bea.gov/international/
factsheet/factsheet.cfm 
Host country’s FDI in the United States (M USD, stock positions) 2020 N/A 2019 1,100 BEA data available at
https://apps.bea.gov/international/
factsheet/factsheet.cfm 
Total inbound stock of FDI as % host GDP 2020 N/A 2019 197% UNCTAD data available at
https://unctad.org/topic/investment/
world-investment-report

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

Table 4: Sources of Portfolio Investment
Data not available.

Barbados

Executive Summary

Barbados is the largest economy in the Eastern Caribbean.  Barbados’ Gross Domestic Product (GDP) was 4.63 billion USD (9.26 billion Barbados dollars) in 2020. This represents an 11.6 percent drop from 2019 due to the impact of COVID-19 on the country’s tourism-dependent economy. Short-term forecasts project a slow recovery throughout 2021, with a gradual return to pre-pandemic levels by 2024. Unemployment was estimated at about 40 percent in the first quarter of 2021, representing a 30 percent increase from the same period a year prior.

The government of Barbados entered a standby arrangement with the International Monetary Fund (IMF) in late 2018.  The 290 million USD (580 million Barbados dollars) Barbados Economic Recovery and Transformation (BERT) program aims to decrease the debt-to-GDP ratio, strengthen the balance of payments, and stimulate growth.  While the government was on track to meet its IMF targets pre-pandemic, the program dampened income and spending power due to public sector layoffs, the introduction of new indirect taxes, and a decline in the construction sector.  The impact of the pandemic required the IMF to adjust the program targets downwards several times. The IMF also approved additional lending into the program twice in 2020.

Barbados ranks 128th out of 190 countries rated in the 2020 World Bank Doing Business Report.  The report highlighted some positive changes in getting access to electricity, trading across borders, and enforcing contracts but noted that registering property has become more difficult. The services sector continues to hold the largest growth potential, especially in the areas of international financial services, information technology, global education services, health, and cultural services.  The gradual decline of the sugar industry has opened land for other agricultural uses.  Investment opportunities exist in the areas of agricultural processing and alternative and renewable energy.  Uncertainty about the trajectory of economic recovery of the tourism, commercial aviation, and cruise industries impacts the potential for projects in those sectors. The government has identified renewable energy and climate resilience projects as top priorities.

Barbados recently revised its tax regime to harmonize its domestic and international tax rates. This was in response to an Organization of Economic Cooperation and Development (OECD) initiative that addressed harmful tax practices. Some acts were repealed or amended, and some new measures were introduced. For further details, see https://www.investbarbados.org/investing-in-barbados/setting-up-in-barbados/revised-tax-regime/ .

Barbados bases its legal system on the British common law system. It does not have a bilateral investment agreement with the United States, but it does have a double-taxation treaty and a tax information exchange agreement.

In 2015, Barbados signed an intergovernmental agreement in observance of the United States’ Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in Barbados to report the banking information of U.S. citizens.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2020 29 of 175 http://www.transparency.org/research/cpi/overview 
World Bank’s Doing Business Report 2020 128 of 190 http://www.doingbusiness.org/en/rankings 
Global Innovation Index 2020 N/A https://www.globalinnovationindex.org/analysis-indicator 
U.S. FDI in partner country ($M USD, historical stock positions) 2019 45,382 https://apps.bea.gov/international/factsheet/ 
World Bank GNI per capita 2019 17,380 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD 

1. Openness To, and Restrictions Upon, Foreign Investment

Policies Towards Foreign Direct Investment

The government of Barbados, through Invest Barbados, welcomes foreign direct investment with the stated goals of creating jobs, earning foreign exchange, transferring technology, enhancing skills, and contributing to economic growth. In 2021, the government announced plans to focus on encouraging foreign direct investment in renewable energy, manufacturing, technology, and biogenetic engineering.

Barbados encourages investment in the following key sectors: international financial services, information technology, and ship registration, as well as developing areas like financial technology, creative industries, agricultural processing, medical schools, medical tourism, and renewable energy. In the international financial services sector, the government maintains regulatory oversight via the Central Bank of Barbados to prevent money laundering and tax evasion.

Through Invest Barbados, the government facilitates domestic and foreign private investment. Invest Barbados’ mandate is to actively promote Barbados as a desirable investment location, to provide advice, and to assist prospective investors. Invest Barbados also provides customized support for investors to assist with the expansion and sustainability of the initial investment. It also serves as the primary liaison for existing investors. In April 2020, the government established a Jobs and Investment Council charged with supporting economic activity during the COVID-19 pandemic and post-pandemic recovery. In March 2021, the government announced plans to establish a Barbados Free Zone to help attract foreign direct investment.

Investors interested in doing business in Barbados must register in person with the country’s Corporate Affairs and Intellectual Property Office. While this is a requirement for foreign and domestic investors, the continuing barriers to international travel posed by COVID-19 currently make it more difficult for foreign investors without established local partners and legal representation to comply with this requirement. The government of Barbados has announced plans to fully digitize the registration process before the end of 2021.

Limits on Foreign Control and Right to Private Ownership and Establishment

There are no limits on foreign control in Barbados. Nationals and non-nationals may establish and own private enterprises and private property in Barbados. These rights extend to the acquisition and disposition of interests in private enterprises.

No industries are closed to private enterprise, although the government reserves the right not to allow certain investments. Some activities, such as telecommunications, utilities, broadcasting, franchises, banking, and insurance require a government license. There are no quotas or other restrictions on foreign ownership of a local enterprise or participation in a joint venture.

Other Investment Policy Reviews

Barbados has not conducted a trade policy review in the last three years.

Business Facilitation

Invest Barbados is the main investment promotion agency that attracts and facilitates foreign investment. Invest Barbados offers guidance and direction to new and established investors seeking to pursue investment opportunities in Barbados. The process is transparent and considers the size of capital investment as well as the economic impact of a proposed project.

Invest Barbados offers a website that is useful for navigating applicable laws, rules, procedures, and registration requirements for foreign investors. This is available at http://www.investbarbados.org . Invest Barbados’ iGuide website is an online guide which provides local and foreign investors with up-to-date information required to make certain investment decisions, including steps for setting up a business, opportunities for investment, labor and other business costs, and legal requirements, among other data. This is available at https://www.theiguides.org/public-docs/guides/barbados . The Corporate Affairs and Intellectual Property Office (CAIPO) maintains an online e-registry filing service for matters pertaining to the Corporate Registry. It is available to registered agents, who are usually attorneys. Information is available at www.caipo.gov.bb .

Barbados ranks 102nd out of 190 countries in the ease of starting a business, which takes seven procedures and approximately 16 days on average to complete, according to the 2020 World Bank Doing Business report. The general practice is to retain an attorney to prepare relevant incorporation documents. The business must register with CAIPO, the Barbados Revenue Authority, the Customs and Excise Department, and any relevant sector-specific licensing agencies.

The government of Barbados continues to facilitate programs and partnerships to assist entrepreneurs who are women and/or people with disabilities. The government of Barbados remains committed to working with civil society and other organizations to meet the UN Sustainable Development Goals by 2030.

Outward Investment

While no incentives are offered, Barbados generally encourages local companies to invest in other countries, particularly within the Caribbean region. Local companies in Barbados are actively encouraged to take advantage of export opportunities related to the country’s membership in the Caribbean Community (CARICOM) and the Caribbean Single Market and Economy (CSME). The Barbados Investment Development Corporation (BIDC) provides market development support for domestic companies seeking to enhance their export potential.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data: BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 5,200 2019 5,209 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data: BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 45,400 BEA data available at
https://apps.bea.gov/
international/factsheet/
 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2019 9,100 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
 
Total inbound stock of FDI as % host GDP N/A N/A 2019 4.1 UNCTAD data available at
https://stats.unctad.org/handbook/
EconomicTrends/Fdi.html
* Source for Host Country Data: Central Bank of Barbados (CBB) http://www.centralbank.org.bb/ 

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

Table 4: Sources of Portfolio Investment
Data not available.

Bermuda

Executive Summary

Bermuda is a self-governing British Overseas Territory with its own Parliament and Constitution. The Governor of Bermuda represents the British monarch and is appointed by Her Majesty The Queen on the advice of the British government. The role of the Governor is to act as head of state, and he or she is responsible for appointing the Premier and the 11 members of the Senate (the upper house of Bermuda’s Parliament).

Bermuda is an important regional and global offshore financial center with a robust financial regulatory system. The United States provides 80% of imported goods and is the island’s largest resource for imports. International business and tourism are Bermuda’s top economic drivers. The re/insurance industry is one of Bermuda’s key leading industries and covers substantial liabilities in the U.S.

Bermuda’s annual 2019 GDP report recorded growth by 0.5 percent to $6.5 billion. The largest increases were from construction, human health and social work industries, and real estate. Gains were offset by decreases in value added for financial and insurance activities, accommodation and food service activities and the wholesale and retail trade industry. Economy-wide inflation, as measured by the implicit price index, increased by 3.1 percent. Including inflation, GDP at current prices increased by 3.6 percent compared to 2018.

Bermuda’s investment climate presents a series of advantages for potential investors. These include:

  • A stable, democratic government.
  • Low personal and corporate taxes.
  • A pool of skilled professionals.
  • Proximity to the United States, and extensive air and communication networks.
  • The Bermuda dollar (BMD) is pegged at par to the USD.

As a British Overseas Territory, Bermuda’s legal system is grounded in UK common law. Its legal, regulatory and accounting systems adhere to high ethical and transparency standards. It generally effectively and impartially enforces its laws to combat corruption and money laundering. There is no government interference in the court system that could affect foreign investors. Bermuda law recognizes and enforces secured interests in real property. The Government of Bermuda’s policies facilitate the free flow of financial resources in the product and factor markets, and the U.S. Securities and Exchange Commission recognizes the Bermuda Stock Exchange (BSX) as a Designated Offshore Securities Market. There is a general awareness of responsible business conduct among both producers and consumers. Bermuda continues to advocate for its leadership in global tax transparency and compliance and collaborates with international business stakeholders to protect its interests. The government welcomes new business to the island and introduced legal and regulatory framework to support fintech startups.

In 2018, the Bermuda Government passed legislation in the House of Assembly that created a regulatory framework for digital coin offerings as an amendment to The Companies and Limited Liability Company Act. The Fintech Business Unit is responsible for engaging with interested startups, engaging with key stakeholders and partners to support and manage the industry as it continues to develop.

Table 1: Key Metrics and Rankings 
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2020 N/A http://www.transparency.org/research/cpi/overview 
World Bank’s Doing Business Report 2020 N/A http://www.doingbusiness.org/en/rankings 
Global Innovation Index 2020 N/A https://www.globalinnovationindex.org/analysis-indicator 
U.S. FDI in partner country ($M USD, stock positions) 2020 N/A  https://apps.bea.gov/international/factsheet/ 
World Bank GNI per capita 2019 117,730 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD 

1. Openness To, and Restrictions Upon, Foreign Investment

Policies Towards Foreign Direct Investment 

Bermuda welcomes foreign direct investment (FDI). The Bermuda Business Development Agency (BDA) is an independent, public-private partnership, funded by both the Bermuda Government and the private sector. The agency is governed by a Board of Directors comprised of senior industry professionals representing the diversity of Bermuda’s financial services sector.  The BDA carries out pro-active, targeted marketing and business development strategies to stimulate growth in the Bermuda economy and create and maintain jobs. (http://bda.bm)

The BDA acts as a partner for existing Bermuda-based companies and assists entities that are considering establishing operations in Bermuda. It connects prospective companies with industry partners and relevant representatives in the Bermuda Monetary Authority (BMA) and the Bermuda Government’s Business Development Unit, making formal introductions, troubleshooting, and communicating with clients to simplify the process. The BDA has segmented its business development efforts into four distinct pillars or industry areas of focus: Risk (insurance, reinsurance, captives, and insurance linked securities), Asset Management, Trust & Private Client, and International Commerce (technology, international markets, etc.). These are key sectors of the Bermuda marketplace, or areas for potential growth, and the BDA has separate business development managers, strategies and goals for each.

Limits on Foreign Control and Right to Private Ownership and Establishment 

The 60/40 rule in Bermuda requires all companies to be controlled by at least 60% Bermudians. In February 2020, the Bermuda Government proposed to introduce a bill that will reduce the current required ownership regulations for a local company from 60% owned by a Bermudian, to 40%, as outlined in the 2020 Budget Report, to help stimulate and promote economic competition.

Some local businesses support relaxing the 60/40 rule to encourage FDI, increase liquidity in the local market, and boost the economy. Other businesses oppose it out of concern that they might not be able to compete with majority foreign-owned businesses.

In addition to ownership regulations, there are restrictions governing ownership of land by businesses.

‘Control’ is defined as the percentage of Bermudian directors, and the percentage of its shares beneficially owned by Bermudians, in the company being not less than 60% in each case. Amendments are expected to create more opportunities and foreign investments by Permanent Resident Certificate (PRC) holders who reside on the island.

Local companies can be exempted from the 60/40 rule by obtaining a license (pursuant to section 114B of the Companies Act) from the Minister of Finance, who decides if the granting of a license is in the best interest of the country. When considering an application for a Section 114B license, the Minister considers:

  • The economic situation in Bermuda and the due protection of persons already engaged in business in Bermuda.
  • The nature and previous conduct of the company and the persons having an interest in the company whether as directors, shareholders or otherwise.
  • Any advantage or disadvantage which may result from the company carrying on business in Bermuda.
  • The desirability of retaining in the control of Bermudians the economic resources of Bermuda.

Certain activities are excluded from the requirement of a license, including:

  • Doing business with other exempted undertakings (e.g., exempted companies, permit companies, exempted partnerships and exempted unit trust schemes) in furtherance of the business of the exempted company that is being conducted outside Bermuda.
  • Dealing in securities of exempted undertakings, local companies, or partnerships; and
  • Carrying on business as manager or agent for, or consultant or advisor to, any exempted company or permit company which is affiliated (whether or not incorporated in Bermuda) with the exempted company or an exempted partnership in which the exempted company is a partner or, in the case of mutual funds, selling or distributing their shares in Bermuda.

In 2012 local companies were exempted from the 60/40 rule if its shares were listed on a designated Stock Exchange, the company conducted business in a material way in a ‘prescribed industry,’ or if the company was a wholly owned subsidiary of such a listed company.

The prescribed industries are capital-heavy and include, inter alia, telecommunications, energy, insurance, hotel operations, banking, or international transportation services (by ship or aircraft).

Other Investment Policy Reviews 

Bermuda is a World Trade Organization (WTO) member through the United Kingdom. Bermuda has not conducted an investment policy review through the OECD, WTO, or UNCTAD within the past three years.

Business Facilitation 

The Investment Business Act 2003 is the statutory basis for regulating investment business in Bermuda. The act provides a licensing regime for any person or entity (unless otherwise exempted or excluded) engaging in investment business, as defined by the act, either in or from Bermuda.

There are several options for registering a business in Bermuda which depend on the nature of the business and whether business will be conducted in the local market. The Registrar of Companies (ROC) is responsible for the day-to-day responsibilities regarding the administration of companies including name reservation, fees, insolvency and real estate. (https://www.gov.bm/department/registrar-companies).

Formation of a limited company, partnership or LLC, which does not require consent of the Minister of Finance may be accomplished within one day after an application is received. Where a business requires the consent from the Minister, the processing time can take up to one week. The ROC reviews all information relating to the company, and all personal declarations from the proposed beneficial owners.

The Bermuda Government requires those seeking to establish a limited company, partnership or LLC, to get assistance from a law firm, accounting firm, or corporate service provider (CSP) located in Bermuda for guidance on completing steps towards establishing a company, including:

  • Name reservation
  • Disclosure and vetting of proposed beneficial owners of the company, including personal declarations where required
  • Drafting the Memorandum of Association and byelaws of the company
  • Based on the nature of the proposed business activities, any license or permit applications required to be submitted
  • Selecting a registered office in Bermuda
  • Selection of directors, officers, and company secretary
  • Payment of government fees
  • Regulations for the emerging Fintech industry have been established. Fintech Bermuda offers information to assist those seeking to establish a digital business on the island (https://fintech.bm/start-a-business/) In 2018, the Government of Bermuda established the Digital Asset Business Act, which outlines the foundation for the government’s regulatory approach towards the industry. The Bermuda Business Development Agency (BDA) also provides guidance for those seeking to establish a digital business on the island and can provide information about immigration, tax and social insurance applications. The BDA also liaises with the Bermuda Monetary Authority, Department of Immigration, Ministry of Finance, Fintech Business Unit and ROC as needed for new incorporations and to monitor the processing of new applications.

Outward Investment 

Bermuda is not involved in outward investment.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Data not available

Table 3: Sources and Destination of FDI
Data not available

Table 4: Sources of Portfolio Investment
Data not available

Dominica

Executive Summary

The Commonwealth of Dominica (Dominica) is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU).  The Government of Dominica strongly encourages foreign direct investment, particularly in industries that create jobs, earn foreign currency, and have a positive impact on local citizens.  Dominica remains vulnerable to external shocks such as climate change impacts, natural hazards, and global economic downturns.  According to Eastern Caribbean Central Bank (ECCB) figures, the economy of Dominica had an estimated gross domestic product (GDP) of $357.6 million (966.4 million Eastern Caribbean dollars) in 2020, which signified a contraction of 15.4 percent mainly due to the ongoing COVID-19 pandemic and the resulting stagnation of the tourism sector.  The International Monetary Fund (IMF) forecasts real GDP growth of 3.3 percent in 2021.

The economy also continues to recover from the devastation caused by Hurricane Maria in 2017.  Losses from Hurricane Maria are estimated at $1.37 billion or 226 percent of GDP.  Prior to the onset of the COVID-19 pandemic, the government was primarily focused on reconstruction efforts, with support from the international community.  During the COVID-19 pandemic, the Government of Dominica has received financial support from the IMF and the World Bank to provide fiscal assistance, macro-economic stability and support in health-related expenditure, loss of household income, food security and the agricultural sector.

Dominica’s ranking in the World Bank’s Doing Business Report remains at the 2020 ranking of 111th out of 190 countries, as the report was not updated during the reporting year.

Through its economic policies, the government is seeking to stimulate sustainable and climate-resilient economic growth through a revised macroeconomic framework that includes strengthening the nation’s fiscal framework.  The government states it is committed to creating a vibrant business climate to attract more foreign investment.

Dominica remains a small emerging market in the Eastern Caribbean (EC), with investment opportunities mainly within the service sector, particularly in eco-tourism; information and communication technologies; and education.  Other opportunities exist in alternative energy, including geothermal energy, and capital works due to reconstruction and new tourism projects.

Recently, the government instituted a number of investment incentives.  Foreign investors in Dominica can repatriate all profits and dividends and can import capital.

Dominica’s legal system is based on British common law.  It does not have a bilateral investment treaty with the United States but has bilateral investment treaties with the UK and Germany.

In 2018, the Government of Dominica signed an Intergovernmental Agreement to implement the U.S. Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in Dominica to report the banking information of U.S. citizens.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2020 48 of 180 http://www.transparency.org/research/cpi/overview
World Bank’s Doing Business Report 2020 111 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2020 N/A https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2019 N/A http://www.bea.gov/international/factsheet/
World Bank GNI per capita ($ M USD) 2019 7, 920 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

1. Openness To, and Restrictions Upon, Foreign Investment

Policies Towards Foreign Direct Investment

The Government of Dominica strongly encourages foreign direct investment, particularly in industries that create jobs, earn foreign currency, and have a positive impact on local citizens.

Through the Invest Dominica Authority (IDA), the government instituted a number of investment incentives for businesses considering locating in Dominica.  Government policies provide liberal tax holidays, duty-free import of equipment and materials, exemption from value added tax on some capital investments, and withholding tax exemptions on dividends, interest payments, and some external payments and income.  The IDA additionally provides support to approved citizenship by investment (CBI) projects.

In late December 2020, the IDA announced plans to launch a new Investment Promotion Strategy in 2021.  The new strategy will focus on four broad areas: agriculture and agri-business, renewable energy, tourism and knowledge services such as business processing operations.  Other sectors include film, music, and video production, manufacturing, bulk water export and bottled water operations, medical and nursing schools, and English language training services.  The government continuously reviews these sectors and has signaled that it is also willing to consider additional sectors.

Limits on Foreign Control and Right to Private Ownership and Establishment

There are no limits on foreign control in Dominica.  Foreign investment in Dominica is not subject to any restrictions, and foreign investors are entitled to receive the same treatment as nationals of Dominica.  Foreign investors are entitled to hold up to 100 percent of their investment.  The only restriction is the requirement to obtain an Alien Landholders License for foreign investors seeking to purchase property for residential or commercial purposes.  Local enterprises generally welcome joint ventures with foreign investors in order to access technology, expertise, markets, and capital.

Other Investment Policy Reviews

The OECS, of which Dominica is a member, has not conducted a World Trade Organization (WTO) trade policy review since 2014.

Business Facilitation

The IDA is Dominica’s main business facilitation unit.  It facilitates foreign direct investment into priority sectors and advises the government on the formation and implementation of policies and programs to attract investment in Dominica.  The IDA provides business support services and market intelligence to all investors.  It offers an online tool useful for navigating laws, rules, procedures, and registration requirements for foreign investors.  Its website is http://investdominica.com.

All potential investors applying for government incentives must submit their proposals for review by the IDA to ensure the project is consistent with the national interest and provides economic benefits to the country.

The Companies and Intellectual Property Office (CIPO) maintains an e-filing portal for most of its services, including company registration on its website.  However, this only allows for the preliminary processing of applications prior to the investor physically making a payment at the Supreme Court office.  Investors are advised to seek the advice of a local attorney prior to starting the process.  Further information is available at http://www.cipo.gov.dm.

The World Bank’s Doing Business Report for 2020 ranks Dominica 71st out of 190 countries in the ease of starting a business.  It takes five procedures and about 12 days to complete the process.  The general practice is to retain an attorney who prepares all the relevant incorporation documents.  A business must register with CIPO, the Tax Authority, and the Social Services Institute.

Outward Investment

There is no restriction on domestic investors seeking to do business abroad.  Local companies in Dominica are actively encouraged to take advantage of export opportunities specifically related to the country’s membership in the OECS Economic Union and the Caribbean Community Single Market and Economy (CSME), which enhance the competitiveness of the local and regional private sectors across traditional and emerging high-potential markets.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) 2020 357.6 2019 582.4 www.worldbank.org/en/country
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:  BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2018 N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2018 N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
Total inbound stock of FDI as  percent host GDP N/A N/A 2019 54.1 percent UNCTAD data available at

https://unctad.org/en/Pages/DIAE/
World %20Investment %20Report/
Country-Fact-Sheets.aspx
 

 

* Source for Host Country Data: Eastern Caribbean Central Bank https://www.eccb-centralbank.org/statistics/dashboard-datas/.

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

Table 4: Sources of Portfolio Investment
Data not available.

Dominican Republic

Executive Summary

Foreign direct investment (FDI) plays an important role for the Dominican economy, and the Dominican Republic is one of the main recipients of FDI in the Caribbean and Central America. The government actively courts FDI with generous tax exemptions and other incentives to attract businesses to the country. Historically, the tourism, real estate, telecommunications, free trade zones, mining, and financing sectors are the largest FDI recipients. In January 2020, the government announced a special incentive plan to promote high-quality investment in tourism and infrastructure in the southwest region and, in February 2020, it passed a Public Private Partnership law to catalyze private sector-led economic growth.

Besides financial incentives, the country’s membership in the Central America Free Trade Agreement-Dominican Republic (CAFTA-DR) is one of the greatest advantages for foreign investors. Observers credit the agreement with increasing competition, strengthening rule of law, and expanding access to quality products in the Dominican Republic. The United States remains the single largest investor in the Dominican Republic. CAFTA-DR includes protections for member state foreign investors, including mechanisms for dispute resolution.

Despite the negative macroeconomic impacts of the pandemic, international indicators of the Dominican Republic’s competitiveness and transparency held steady. Foreign investors report numerous systemic problems in the Dominican Republic and cite a lack of clear, standardized rules by which to compete and a lack of enforcement of existing rules. Complaints include allegations of widespread corruption; requests for bribes; delays in government payments; weak intellectual property rights enforcement; bureaucratic hurdles; slow and sometimes locally biased judicial and administrative processes, and non-standard procedures in customs valuation and classification of imports. Weak land tenure laws and government expropriations without due compensation continue to be a problem. The public perceives administrative and judicial decision-making to be inconsistent, opaque, and overly time-consuming. Corruption and poor implementation of existing laws are widely discussed as key investor grievances.

U.S. businesses operating in the Dominican Republic often need to take extensive measures to ensure compliance with the Foreign Corrupt Practices Act. Many U.S. firms and investors have expressed concerns that corruption in the government, including in the judiciary, continues to constrain successful investment in the Dominican Republic.

In August 2020, President Luis Abinader became the 54th President of the Dominican Republic, presiding over the first change in power in 16 years. Taking office with bold promises to rein in corruption, the government quickly arrested a slew of high-level officials from the previous administration implicated in corruption—people who under prior governments would have been considered untouchable. It remains to be seen whether Abinader will deliver on more complex commitments, such as institutional reforms to advance transparency or long-delayed electricity sector reform.

The Dominican Republic, an upper middle-income country, contracted by 6.7 percent in 2020 and concluded the year with a 7.7 percent deficit thanks to the pandemic. The IMF and World Bank project growth for 2021 at 4.0-4.8 percent.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2020 137 of 180 http://www.transparency.org/research/cpi/overview 
World Bank’s Doing Business Report 2020 115 of 190 http://www.doingbusiness.org/en/rankings 
Global Innovation Index 2020 90 of 131 https://www.globalinnovationindex.org/analysis-indicator 
U.S. FDI in partner country ($M USD, historical stock positions) 2019 $2,604 https://apps.bea.gov/international/factsheet/factsheet.cfm?Area=207&UUID=8544e377-fb53-42fe-a16e-01c425113446 
World Bank GNI per capita 2019 $8,080 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD 

1. Openness To, and Restrictions Upon, Foreign Investment

Policies Towards Foreign Direct Investment

The Dominican Republic presents both opportunities and challenges for foreign investment. The government strongly promotes inward FDI and has prioritized creating a sound enabling environment for foreign investors. While the government has established formal programs to attract FDI, a lack of clear rules and uneven enforcement of existing rules can lead to difficulties.

The Dominican Republic provides tax incentives for investment in tourism, renewable energy, film production, Haiti-Dominican Republic border development, and the industrial sector. The country is also a signatory of CAFTA-DR, which mandates non-discriminatory treatment, free transferability of funds, protection against expropriation, and procedures for the resolution of investment disputes. However, some foreign investors indicate that the uneven enforcement of regulations and laws, or political interference in legal processes, creates difficulties for investment.

There are two main government agencies responsible for attracting foreign investment, the Export and Investment Center of the Dominican Republic (CEI-RD) and the National Council of Free Trade Zones for Export (CNZFE). CEI-RD promotes foreign investment and aids prospective foreign investors with business registration, matching services, and identification of investment opportunities. It publishes an annual “Investment Guide of the Dominican Republic,” highlighting many of the tools, incentives, and opportunities available for prospective investors. The CEI-RD also oversees “ProDominicana,” a branding and marketing program for the country launched in 2017 that promotes the DR as an investment destination and exporter. CNZFE aids foreign companies looking to establish operations in the country’s 75 free trade zones for export outside Dominican territory.

There are a variety of business associations that promote dialogue between the government and private sector, including the Association of Foreign Investor Businesses (ASIEX).

Limits on Foreign Control and Right to Private Ownership and Establishment

Foreign Investment Law No. 16-95 states that unlimited foreign investment is permitted in all sectors, with a few exceptions for hazardous materials or materials linked to national security. Private entities, both foreign and domestic, have the right to establish and own business enterprises and engage in all legal remunerative activity. Foreign companies are not restricted in their access to foreign exchange, there are no requirements that foreign equity be reduced over time or that technology be transferred according to defined terms, and the government imposes no conditions on foreign investors concerning location, local ownership, local content, or export requirements. See Section 3 Legal Regime for more information.

The Dominican Republic does not maintain a formalized investment screening and approval mechanism for inbound foreign investment. Details on the established mechanisms for registering a business or investment are elaborated in the Business Facilitations section below.

Other Investment Policy Reviews

The Dominican Republic has not been reviewed recently by multilateral organizations regarding investment policy. The most recent reviews occurred in 2015. This included a trade policy review by the World Trade Organization (WTO) and a follow-up review by the United Nations Conference on Trade and Development (UNCTAD) regarding its 2009 investment policy recommendations.

2009 UNCTAD – https://unctad.org/en/pages/PublicationArchive.aspx?publicationid=6343 

2015 WTO – https://www.wto.org/english/tratop_e/tpr_e/s319_e.pdf

2015 UNCTAD – https://unctad.org/en/PublicationsLibrary/diaepcb2016d2_en.pdf

Business Facilitation

Foreign investment does not require any prior approval in the Dominican Republic, but once made it must be registered with the CEI-RD. Investments in free zones must be registered with the CNZFE, which will notify the CEI-RD.  Foreign investment registration is compulsory, but failure to do so is not subject to any sanction.  In the World Bank’s “Doing Business” report, the Dominican Republic’s overall ranking for ease of doing business fell from 102 in 2019 to 115 in 2020, reflecting stagnant performance in several of the indicator categories.

Law No. 16-95 Foreign Investment, Law No. 98-03 on the Creation of the CEI-RD, and Regulation 214-04 govern foreign investment in the Dominican Republic and require an interested foreign investor to file an application form at the offices of CEI-RD within 180 calendar days from the date on which the foreign investment took place. The required documents include the application for registration, containing information on the invested capital and the area of the investment; proof of entry into the country of the foreign capital or physical or tangible goods; and documents of commercial incorporation or the authorization of operation of a branch office through the setting up of legal domicile in the country.  The reinvestment of profits (in the same or a different firm) must be registered within 90 days. Once the documents have been approved, the CEI-RD issues a certificate of registration within 15 business days subject to the payment of a fee which varies depending on the amount of the investment.

Lack of registration does not affect the validity of the foreign investment; but the fact that it is needed to fulfil various types of procedures, makes registration necessary in practice. For example, the registration certificate has to be presented to repatriate profits or investment in the event of sale or liquidation and to purchase foreign exchange from the authorized agencies for transfers abroad, as well as to process the residency of the investor.  In April 2021, CEI-RD launched an online Registry of Foreign Direct Investment, which aims to streamline and make the registration processes more transparent to investors. For more information on becoming an investor or exporter, visit the CEI-RD ProDominicana website at https://prodominicana.gob.do .

The Dominican Republic has a single-window registration website for registering a limited liability company (SRL by its Spanish acronym) that offers a one-stop shop for registration needs ( https://www.formalizate.gob.do/ ). Foreign companies may use the registration website. However, this electronic method of registration is not widely used in practice and consultation with a local lawyer is recommended for company registrations. According to the “Doing Business” report, starting a SRL in the Dominican Republic is a seven-step process that requires 16.5 days. However, some businesses advise the full incorporation process can take two to three times longer than the advertised process.

In order to set up a business in a free trade zone, a formal request must be made to the CNZFE, the entity responsible for issuing the operating licenses needed to be a free zone company or operator. CNZFE assesses the application and determines its feasibility. For more information on the procedure to apply for an operating license, visit the website of the CNZFE at http://www.cnzfe.gov.do .

Outward Investment

There are no legal or government restrictions on Dominican investment abroad, although the government does little to promote it. Outbound foreign investment is significantly lower than inbound investment. The largest recipient of Dominican outward investment is the United States.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data: BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $88,906 2019 $88,941 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data: BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 $2,604 BEA data available at
https://apps.bea.gov/
international/factsheet/ 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2019 $151 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data 
Total inbound stock of FDI as % host GDP N/A N/A 2019 47.3% UNCTAD data available at
https://stats.unctad.org/handbook/
EconomicTrends/Fdi.html 

* Source for Host Country Data: Central Bank of the Dominican Republic (BCRD). The BCRD does not report investment stock positions.

No information for the Dominican Republic is available on the IMF’s Coordinated Direct Investment Survey (CDIS) website. According to the Dominican Central Bank (BCRD), total inward flows of FDI for 2020 were $2.6 billion. The BCRD provides a breakdown of FDI to the Dominican Republic by individual source country for the top investing countries. The five largest investing countries accounted for 82.3 percent of total inward FDI in 2019. Neither World Bank nor Dominican sources break down FDI from the Dominican Republic to individual destination countries.

Table 3: Sources and Destination of FDI
Direct Investment from/in Counterpart Economy Data
From Top Five Sources/To Top Five Destinations (US Dollars, Millions)
Inward Direct Investment Outward Direct Investment
Total Inward $3,012.8 100% Total Outward Amount 100%
United States $948.3 31.5% N/A N/A N/A
Mexico $640.2 21.2% N/A N/A N/A
Spain $394.3 13.1% N/A N/A N/A
Canada $258.3 8.6% N/A N/A N/A
France $237.8 7.9% N/A N/A N/A
“0” reflects amounts rounded to +/- USD 500,000.

* Source for Host Country Data: Central Bank of the Dominican Republic (BCRD), 2020 FDI inward flows.

Table 4: Sources of Portfolio Investment
No information for the Dominican Republic is available on the IMF’s Coordinated Portfolio Investment Survey (CPIS) site and the Dominican government only publishes information on general investment flows ( https://www.bancentral.gov.do/a/d/2532-sector-externo ).

Grenada

Executive Summary

Grenada has a strong legal framework for business. Generally, the presence of a comprehensive investment incentive regime, stable economy, existing trade agreements, and responsive investment promotion experts contributes to a positive investment climate. In 2020 and 2021, however, Grenada’s tourism-driven economy was severely impacted by the global COVID-19 pandemic. Recovery will be a multi-year process.

The country recorded negative 11.2 percent growth in 2020, a stark contrast to the average 4 percent growth experienced from 2013 to 2019. Tourism and private tertiary education are the main revenue earners and were the hardest hit sectors. In the second quarter of 2020, the unemployment rate almost doubled to 28.4 percent, compared to 15.1 percent in the fourth quarter of 2019. In 2020, Grenada lost more than 14,000 jobs from a labor force of approximately 50,000. The government experienced a significant shortfall in tax revenues and is likely to run a deficit in 2021. Although the debt-to-GDP ratio fell from 108 percent in 2013 to just under 60 percent by the end of 2020, it is projected to rise to 73 percent in 2021 due to the recent increase in long-term concessionary loans taken out to finance COVID response and economic stimulus programs.

The government forecasts 6 percent GDP growth in 2021 driven by construction and major public and private sector projects through Grenada’s Citizenship by Investment (CBI) program. Despite the pandemic, the Grenada Investment Development Corporation (GIDC) and CBI program consistently received applications for investment incentives and projects in 2020. During the first quarter of 2020, CBI applications were 25 percent above 2019 figures despite an anticipated decline. According to the Ministry of Finance, the CBI program generated $6.18 million in revenues for the government in the fourth quarter of 2020.

In 2020, the International Center for the Settlement of Investment Disputes (ICSID) tribunal ordered the government of Grenada to repurchase the shares owned by U.S. company WRB Enterprises, the former majority shareholder in Grenada’s sole electricity company, at a valuation of approximately $74 million. The arbitration stemmed from a 2016 law that liberalized the energy sector in Grenada, which was found to abrograte WRB’s monopoly and thus allowed WRB to require the government of Grenada to repurchase its shares. Following the ICSID ruling, the government of Grenada repurchased the WRB shares in a negotiated settlement.

The government of Grenada has a strong interest in climate resilience initiatives, increasing the use of renewable energy, and developing the blue economy (broadly defined as the sustainable, environmentally sensitive use of ocean resources for economic growth and job creation). Other international investments include projects in construction, retail, duty free outlets, and agriculture. The Grenada parliament made legislative revisions to the acts governing value added tax, property transfer tax, investment, excise tax, customs (service charge), and bankruptcy and insolvency. The government also launched an innovative Investment Incentives Regime intended to streamline bureaucratic and legal processes. This regime improves transparency, equitable treatment of investors, and adherence to the rule of law, thus bolstering Grenada’s marketability as an investor-friendly climate.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2020 52 of 180 http://www.transparency.org/research/cpi/overview
World Bank’s Doing Business Report 2020 146 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2020 N/A https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2019 41 (outward)
8 (inward)
https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2019 USD $9,840 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

1. Openness To, and Restrictions Upon, Foreign Investment

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.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) 2020 $1,074 2019 $1,211 www.worldbank.org/en/country
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:  BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 $41 BEA data available at
https://apps.bea.gov/
international/factsheet/
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2019 $8 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
Total inbound stock of FDI as % host GDP N/A N/A 2019 10.8 UNCTAD data available at
https://stats.unctad.org/
handbook/EconomicTrends/Fdi.html
    

* 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

Haiti

Executive Summary

Haiti, one of the most urbanized nations in Latin America and the Caribbean region, occupies the western third of the island of Hispaniola. Despite efforts by the Haitian government to achieve macroeconomic stability and sustainable private sector-led and market-based economic growth, Haiti’s investment climate is characterized by, an unstable national currency (Haitian gourde), persistent inflation, high unemployment, political uncertainty, and insecurity. The global outbreak of the coronavirus and resulting slowdown of economic activity in 2020 further complicated the Haitian government’s capacity to achieve macroeconomic stability, create jobs, and encourage economic development through foreign trade and investment. In the absence of a functioning parliament, the Haitian government has additionally taken steps to regulate commercial activity by presidential decree, with sudden regulatory changes the business community views as detrimental to a functioning market. As a free market system, the Haitian economy traditionally relies on its agricultural, construction, and commerce sectors, as well as the export-oriented apparel assembly industry. Although the business climate is challenging, Haiti’s legislation encourages foreign direct investment. The government has prioritized building and improving infrastructure, including boosting energy production, and has additionally designated agriculture, manufacturing, and tourism as key investment sectors. The Haitian investment code provides the same rights, privileges, and equal protection to local and foreign companies. Under Haitian law, Haiti’s business climate affords equal treatment to all investors, including women, minorities, and foreign nationals.

Haiti continues to face significant challenges and civil unrest. With national elections scheduled for September 2021, it is anticipated that political uncertainty and a short-term economic policy focus will compound the workings of an already- opaque bureaucracy. While the country maintains a liberal trade and foreign exchange regime, and largely adheres to World Bank programs to fight poverty, continuing reports of corruption and financial mismanagement have raised questions about investment.

Foreign Direct Investment (FDI) inflows reached a historic low of $55 million in 2019, according to the UN’s Economic Commission for Latin America and the Caribbean (ECLAC), down from $105 million the year prior and at the lowest level since ECLAC began recording FDI inflows using a consistent methodology in 2010. Inflation remains above target because of weak domestic production, a deepening government budget deficit mostly financed by monetization, food price pressures, and the depreciation of the Haitian gourde against the U.S. dollar. Haiti’s net international reserves were $501 million as of early March 2021. Improving the investment outlook for Haiti requires political and economic stability underscored by the enactment of institutional and structural reforms that can improve Haiti’s business and political environment. The International Monetary Fund projects GDP growth at a rate of 1.2 percent in 2021.

Haiti is ranked 170 out of 189 countries on the United Nations Development Program’s 2020 Human Development Index. The World Bank’s latest household survey in 2012 reported that over 6 million Haitians live on less than $2.41 per day, and more than 2.5 million fall below $1.12 per day.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2020 170 of 175 http://www.transparency.org/research/cpi/overview
World Bank’s Doing Business Report 2020 179 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index N/A N/A https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2019 $29.0M https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2019 $1,330 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

1. Openness To, and Restrictions Upon, Foreign Investment

Policies Towards Foreign Direct Investment

Haiti’s legislation encourages foreign direct investment. Import and export policies are non-discriminatory and are not based on nationality. Haitian and foreign investors have the same rights, privileges and protections under the 1987 investment code. The Haitian government has made some progress in recent years to improve the legal framework, create and strengthen core public institutions, and enhance economic governance. The Haitian Central Bank continues to work with the International Monetary Fund (IMF) and the World Bank to implement measures aimed at creating a stable macroeconomic environment. The IMF concluded its most recent Article IV economic consultation with Haiti in January 2020 (www.imf.org/en/countries/hti). In April 2020, the IMF loaned Haiti $112 million through its rapid credit facility mechanism to provide liquidity to Haiti for expenditures to address COVID-19.

While not discriminatory towards international investment specifically, the Haitian government’s economic policies fall short of providing a sound enabling environment for foreign direct investment. The Haitian Central Bank announced in August 2020 the intention to use up to $150 million of its international reserves to intervene in the foreign exchange market, resulting in a rapid appreciation of the country’s local currency, the Haitian gourde (HTG), relative to the U.S. dollar (USD). The gourde appreciated from about 121 HTG/USD to 62 HTG/USD over two months and began steadily depreciating in November 2020 to its rate of 80 HTG/USD as of April 2021. The gourde’s sudden and unexpected change in value has resulted in sustained increased costs for export-oriented businesses, including international investors.

Despite passing anti-money laundering and anti-corruption laws to ensure that Haiti’s legislation corresponds with international standards, the government has not strictly followed the legal framework of these laws, and has failed to incentivize investment in Haiti. In early 2017, the Parliament enacted legislation making electronic signatures and electronic transactions legally binding. Other pieces of legislation that may improve Haiti’s investment climate remain pending, including incorporation procedures, a new mining code, and an insurance code. Haiti’s Finance Ministry is implementing measures to improve revenue collection and control spending. The Ministry signed an agreement with Haiti’s Central Bank in November 2019 to strengthen fiscal discipline and limit government monetary financing. Despite these measures, the rate of monetary financing over fiscal year (FY) 2021 appears to be outpacing the annual budgeted amount of $462 million (3.6 percent of FY2021 IMF-projected GDP), standing at $377 million (3.0 percent of GDP) as of March 4, 2021, less than six months into the fiscal year. The Center for the Facilitation of Investments (CFI), which operates under Haitian Ministry of Commerce oversight, was established to promote domestic and international investment opportunities in Haiti. In concept, the CFI could streamline the investment process by: working with other government agencies to simplify procedures related to trade and investment; providing updated economic and commercial information to local and foreign investors; making proposals on investor incentives; and promoting investment in priority sectors. The CFI aims to offer tailored services to large international investors, but has been unable to operate at full capacity during the pandemic. In practice, the CFI has made limited progress to incentivize job creation and boost national production in agriculture, apparel assembly, and tourism. As an example, prior to the COVID-19 pandemic, Haiti’s Tourism Association reported a 60 percent loss of jobs in the sector in 2019.

Limits on Foreign Control and Right to Private Ownership and Establishment

The Haitian government does not impose discriminatory requirements on foreign investors. Haitian laws related to residency status and employment are reciprocal. Foreigners who are legal residents in Haiti and wish to engage in trade have, within the framework of laws and regulations, the same rights granted to Haitian citizens. However, Article 5 of the Decree on the Profession of Merchants reserves the function of manufacturer’s agent for Haitian nationals.

Foreign firms are also encouraged to participate in government-financed development projects. Performance requirements are not imposed on foreign firms as a condition for establishing or expanding an investment, unless indicated in a signed contract.

Foreign investors are permitted to own 100 percent of a company or subsidiary. As a Haitian entity, such companies enjoy all rights and privileges provided under the law. Additionally, foreign investors are permitted to operate businesses without equity-to-debt ratio requirements. Accounting law allows foreigners to capitalize using tangible and intangible assets in lieu of cash investments.

Foreign investors are free to enter into joint ventures with Haitian citizens. The distribution of shares is a private matter between the two parties. However, the government regulates the sale and purchase of company shares. Investment in certain sectors, such as health and agriculture, requires special Haitian government authorization. Investment in “sensitive” sectors such as electricity, water, telecommunications, and mining require a Haitian government concession as well as authorization from the appropriate governmental agency. In general, natural resources are the property of the state, and the exploitation of mineral and energy resources requires concessions and permitting from the Ministry of Public Works’ Bureau of Mining and Energy. Mining, prospecting, and operating permits may only be granted to companies established and resident in Haiti, and the establishment of new industrial mines cannot take place until an elected parliament passes an updated mining law, along the lines of a draft law initially presented in 2017.

Entrepreneurs are free to dispose of their properties and assets, and to organize production and marketing activities in accordance with local laws.

Investors in Haiti can create the following types of businesses: sole proprietorship, limited or general partnership, joint-stock company, public company (corporation), subsidiary of a foreign company, and co-operative society. The most common business structures in Haiti are corporations. A draft law (Société de Droits law), which would facilitate the creation of other types of businesses in Haiti, such as LLCs, remains pending parliamentary approval when parliament is restored.

Other Investment Policy Reviews

Haiti’s last investment policy review from the United Nations Conference on Trade and Development occurred in 2012. In general, Haiti’s political instability, weak institutions, and inconsistent economic policies impede the country’s ability to attract and direct foreign direct investment.

The World Trade Organization’s (WTO) 2015 Trade Policy Review stated that Haiti’s Investment Code and Law on Free Trade Zones is fully compliant with the Agreement on Trade-Related Investment Measures. The full report can be viewed at https://www.wto.org/english/tratop_e/tpr_e/tp427_e.htm .

Business Facilitation

While the Haitian government has made efforts to facilitate the launching and operating of businesses, the average time to start a business in Haiti is 189 days, according to the World Bank’s 2020 Ease of Doing Business Report. At present, it takes between 90 and 120 days to complete registration with the Commercial Registry at the Ministry of Commerce and obtain the authorization of operations (Droit de fonctionnement). The Center for Facilitation of Investments (CFI), a public-private organization, also offers a service providing pre-registered and fully authorized companies in manufacturing, agribusiness, and real estate the opportunity to reduce their registration time. Once the Inter-Ministerial Investment Commission validates these established companies, the shares are transferred to the new owners.

Both foreign and domestic businesses can register at Haiti’s CFI: http://cfihaiti.com . All businesses must register with the Ministry of Commerce, the Haitian tax office, the state-owned Banque Nationale de Crédit, the social security office, and the retirement insurance office.

The Ministry of Commerce and Industry’s internet registry allows investors to search for and verify the existence of a business in Haiti. The registry will eventually provide online registration of companies through an electronic one-stop shop. In October 2020, CFI launched Spotlight, an initiative with the aim of promoting visibility of companies already established in Haiti and registered in the CFI database.

Outward Investment

Neither the law nor the Haitian government restricts domestic investors from investing abroad. Still, Haiti’s outward investment is limited to a few enterprises with small investments. These investors are generally businesspersons with dual citizenship and others of Haitian origin who presently reside in the country in which their firms operate. The majority of these firms are service providers and not investment firms. There is no current program or incentive in place to encourage Haitian entrepreneurs to invest abroad.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Central Bank of Haiti USG or international statistical source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Haiti Gross Domestic Product (GDP) ($M USD) N/A N/A 2019 $14,332 www.worldbank.org/en/country
Foreign Direct Investment Central Bank of Haiti USG or international statistical source USG or international Source of data:  BEA; IMF; Eurostat; UNCTAD, Other
Total FDI in partner country ($M USD, stock positions) FY2019 $75 2019 $55 UN ECLAC data available at:
https://repositorio.cepal.org/bitstream/handle/ 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A N/A N/A BEA data available at
https://www.bea.gov/international/direct-investment-and-multinational-enterprises-comprehensive-data
Total inbound stock of FDI as % host GDP N/A N/A 2019 0.9% UNCTAD data available at
https://stats.unctad.org/handbook/
EconomicTrends/Fdi.html  
 

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

Table 4: Sources of Portfolio Investment
Data not available.

Saint Kitts and Nevis

Executive Summary

The Federation of St. Christopher and Nevis (St. Kitts and Nevis) is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU).  The government seeks to facilitate a conducive business climate to attract more foreign investment.  St. Kitts and Nevis remains vulnerable to external shocks such as climate change impacts, natural disasters, and global economic downturns.  According to Eastern Caribbean Central Bank (ECCB) figures, the economy of St. Kitts and Nevis had an estimated gross domestic product (GDP) of $927.4 million (2.5 billion Eastern Caribbean dollars) in 2020, having contracted 11.2 percent mainly due to the ongoing COVID-19 pandemic and the resulting impact on the tourism sector.  The International Monetary Fund (IMF) forecasts real GDP growth of -2 percent in 2021.

St. Kitts and Nevis’ ranking in the World Bank’s Doing Business Report remains at the 2020 ranking of 139th out of 190 countries, as the report was not updated during the reporting year.

The COVID-19 pandemic has significantly reduced the economic gains St. Kitts and Nevis had made in recent years.  The impact of the pandemic on tourism, a mainstay of St. Kitts and Nevis’s economy that generates over 60 percent of GDP, has had ripple effects across the economy.  The government has introduced measures to protect workers and key economic sectors.

St. Kitts and Nevis has identified priority sectors for investment.  These include financial services, tourism, real estate, agriculture, information technology, education services, renewable energy, and limited light manufacturing.

The government provides some investment incentives for businesses that are considering establishing operations in St. Kitts or Nevis, encouraging both domestic and foreign private investment.  Foreign investors can repatriate all profits, dividends, and import capital.

The country’s legal system is based on British common law.  It does not have a bilateral investment treaty with the United States.  It has a Double Taxation Agreement with the United States, although the agreement only addresses social security benefits.

In 2016, St. Kitts and Nevis signed an Intergovernmental Agreement in observance of the U.S. Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in St. Kitts and Nevis to report banking information of U.S. citizens.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2020 45 http://www.transparency.org/research/cpi/overview
World Bank’s Doing Business Report 2020 139 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2020 N/A https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2019 476 http://www.bea.gov/international/factsheet/
World Bank GNI per capita ($M USD) 2019 19,920 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

1. Openness To, and Restrictions Upon, Foreign Investment

Policies Towards Foreign Direct Investment

The government of St. Kitts and Nevis strongly encourages foreign direct investment, particularly in industries that create jobs, earn foreign currency, and have a positive impact on its citizens.

The country is home to the ECCB, the Eastern Caribbean Securities Exchange (ECSE), and the Eastern Caribbean Securities Regulatory Commission (ECSRC).

In the federation, each island has a separate investment promotion agency, the St. Kitts Investment Promotion Agency (SKIPA) and the Nevis Investment Promotion Agency (NIPA).  Both agencies have introduced several investment incentives for businesses that consider locating in the federation.  SKIPA and NIPA provide “one-stop shop” facilitation services to investors, guiding them through the various stages of the investment process.

The federal government encourages investment in all sectors, but targeted sectors include financial services, tourism, real estate, agriculture, information and communication technologies, international education services, renewable energy, ship registries, and limited light manufacturing.

Limits on Foreign Control and Right to Private Ownership and Establishment

There are no limits on foreign control in St. Kitts and Nevis.  Foreign investors may hold up to 100 percent of an investment.  Local enterprises generally welcome joint ventures with foreign investors to access technology, expertise, markets, and capital.

Foreign investment in St. Kitts and Nevis is generally not subject to any restrictions, and foreign investors receive the same treatment as citizens.  The only exception to this is the requirement that foreign investors obtain an Alien Landholders License to purchase residential or commercial property.

Other Investment Policy Reviews

The OECS, of which St. Kitts and Nevis is a member, has not conducted a World Trade Organization (WTO) trade policy review in the last three years.

Business Facilitation

SKIPA and NIPA facilitate domestic and foreign direct investment in priority sectors and advise the government on the formation and implementation of policies and programs to attract investment.  Both agencies provide business support services and market intelligence to investors.

St. Kitts and Nevis ranks 109th of 190 countries in starting a business, which takes seven procedures and about 18.5 days to complete, according to the World Bank’s 2020 Doing Business Report.  It is not mandatory that an attorney prepare incorporation documents.  A business must register with the Financial Services Regulatory Commission, the Registrar of Companies, the Ministry of Finance, the Inland Revenue Department, and the Social Security Board.

Outward Investment

There is no restriction on domestic investors seeking to do business abroad.  Local companies in St. Kitts and Nevis are actively encouraged to take advantage of export opportunities specifically related to the country’s membership in the OECS Economic Union and the Caribbean Community Single Market and Economy (CSME), which enhance the competitiveness of the local and regional private sectors across traditional and emerging high-potential markets.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 927.4 2019 1,053 www.worldbank.org/en/country
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:  BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 476 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A N/A N/A BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
Total inbound stock of FDI as % host GDP N/A N/A 2019 169.1 UNCTAD data available at
https://unctad.org/en/Pages/DIAE/
World%20Investment%20Report/
Country-Fact-Sheets.aspx

* Source for Host Country Data: Eastern Caribbean Central Bank https://www.eccb-centralbank.org/statistics/dashboard-datas/.

Table 3: Sources and Destination of FDI
St. Kitts and Nevis does not appear in the IMF’s Coordinated Direct Investment Survey (CDIS).

Table 4: Sources of Portfolio Investment
St. Kitts and Nevis does not appear in the IMF Coordinated Portfolio Investment Survey (CPIS).

Saint Lucia

Executive Summary

Saint Lucia is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU).  Saint Lucia had an estimated Gross Domestic Product (GDP) of $2.122 billion in 2019 according to the latest figures obtained from the World Bank.  Tourism is Saint Lucia’s main economic sector, while real estate and transport are other leading sectors.  The COVID-19 pandemic has significantly impacted Saint Lucia’s economy, experiencing an 18.9 percent contraction in 2020.  The International Monetary Fund (IMF) forecasts 3.1 percent growth in 2021.  The government remains committed to creating a welcoming and open business climate to attract more foreign investment to the country.  Investment opportunities are focused primarily in tourism and hotel development, information and communication technology, manufacturing, international financial services, agribusiness, and creative industries.

Saint Lucia ranked 93 out of 190 countries in the 2020 World Bank’s Doing Business Report.

The Government of Saint Lucia provides several incentives to encourage domestic and foreign private investment.  For example, foreign investors in Saint Lucia can repatriate all profits, dividends, and import capital.

The Saint Lucia legal system is based on the British common law system, but its civil code and property law are greatly influenced by French law.  Saint Lucia does not have a bilateral investment treaty with the United States, but it has bilateral investment treaties with the United Kingdom and Germany.

In 2014, the Government of Saint Lucia signed an Intergovernmental Agreement in observance of the U.S. Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in Saint Lucia to report the banking information of U.S. citizens.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2020 N/A http://www.transparency.org/research/cpi/overview
World Bank’s Doing Business Report 2020 93 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2020 N/A https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2019 412 http://www.bea.gov/international/factsheet/
World Bank GNI per capita ($M USD) 2019 11,020 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

1. Openness To, and Restrictions Upon, Foreign Investment

Policies Towards Foreign Direct Investment

The Government of Saint Lucia strongly encourages foreign direct investment (FDI).  Invest Saint Lucia has introduced several investment incentives for businesses that consider locating in Saint Lucia, encouraging both domestic and foreign private investment.  Invest Saint Lucia is managed by a Chief Executive Director and is overseen by a board of directors appointed by the government under the Office of the Prime Minister and Minister of Commerce, International Trade, Investment, Enterprise Development and Consumer Affairs. The state-run agency Invest Saint Lucia provides “one-stop shop” facilitation services to investors, helping to guide them through the various stages of the investment process.  It assesses investment proposals for viability and in accordance with the laws of Saint Lucia and provides investment promotion services.

Applicable government agencies, rather than Invest Saint Lucia, grant investment concessions.  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.

The Saint 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 Saint 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.  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 Saint 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.  It focuses on building and promoting Saint 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 Saint 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

Saint Lucia, as a member state of the OECS, has not conducted a trade policy review in the last three years.

Business Facilitation

All potential investors applying for government incentives must submit their proposals for review by Invest Saint Lucia to ensure the projects are consistent with the national interest and provide economic benefits to the country.  Invest Saint Lucia offers an online resource that is useful for navigating the laws, rules, procedures and registration requirements for foreign investors.  It is available at http://www.investstlucia.com/.

The Registry of Companies and Intellectual Property office maintains an e-filing portal for most of its services, including company registration.  Relevant officials can review applications submitted electronically.  Applicants, however, must pay the registration fee in-person at the Registry office.  The Registry of Companies and Intellectual Property office can only accept payment in the form of cash and checks.  Personal checks are not accepted.  It is advisable to consult a local attorney prior to starting the process.  Further information is available at http://www.rocip.gov.lc.

According to the World Bank Doing Business Report for 2020, Saint 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 Saint 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.

The Government of Saint Lucia is committed to the full participation of people with disabilities in the society and the economy.  It actively engages with people with disabilities in society to ensure the equal participation of people with disabilities in the formal and informal sectors of the economy.

Outward Investment

The Government of Saint Lucia prioritizes investment retention as a key component of its overall economic strategy.  While the Government of Saint 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 Saint Lucia are actively encouraged to take advantage of export opportunities specifically related to the country’s membership in the OECS Economic Union and the Caribbean Community Single Market and Economy (CSME), which enhance the competitiveness of the local and regional private sectors across traditional and emerging high-potential markets.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount  
Host Country Gross Domestic Product (GDP) ($M USD) N/A N/A 2019 2122 www.worldbank.org/en/country
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:  BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 412 BEA data available at https://www.bea.gov/international/
direct-investment-and-multinational-enterprises-comprehensive-data
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2019 7 BEA data available at https://www.bea.gov/international/
direct-investment-and-multinational-enterprises-comprehensive-data
Total inbound stock of FDI as % host GDP N/A N/A 2019 51.7% UNCTAD data available at https://unctad.org/en/Pages/DIAE/World%
20Investment%20Report/Country-Fact-Sheets.aspx
 

* Source for Host Country Data: Eastern Caribbean Central Bank – https://www.eccb-centralbank.org/statistics/gdp-datas/comparative-report/1

Table 3: Sources and Destination of FDI
Data not available; Saint Lucia does not appear in the IMF’s Coordinated Direct Investment Survey (CDIS).

Table 4: Sources of Portfolio Investment
Data not available; Saint Lucia does not appear in the IMF Coordinated Portfolio Investment Survey (CPIS).

Saint Vincent and the Grenadines

Executive Summary

St. Vincent and the Grenadines is a member of the Organization of Eastern Caribbean States (OECS) and the Eastern Caribbean Currency Union (ECCU).  According to Eastern Caribbean Central Bank (ECCB) statistics, St. Vincent and the Grenadine’s 2020 estimated gross domestic product (GDP) was 783 million USD (2.12 billion Eastern Caribbean dollars) in 2020.  This represents an estimated 7 percent reduction from 2019, following several consecutive years of minimal growth.  St. Vincent and the Grenadines, like other Eastern Caribbean countries, is highly dependent on tourism, which accounted for 28.6 percent of GDP and 19.9 percent of formal sector employment in 2019.  The anticipated recovery from the pandemic-induced downturn is expected to fall significantly short of expectations, contributing to a challenging economic outlook for 2021.  Short-term forecasts project a sluggish recovery throughout 2021 and a return to pre-pandemic levels of growth and tourism by 2024.  The economy might struggle to hit its forecasted growth of around 3.7 percent in 2021, and in fact may continue to contract as the tourism sector is impacted by the ongoing pandemic.

Unanticipated spending on health care, extended welfare and unemployment benefits, and economic stimulus initiatives, coupled with a sharp drop in government revenues in 2020, forced the government to borrow to finance a widening fiscal deficit.  This new borrowing is primarily from international financial institutions on concessional terms.

The country seeks to diversify its economy across several niche markets, particularly tourism, international financial services, agroprocessing, light manufacturing, renewable energy, creative industries, and information and communication technologies.  St. Vincent and the Grenadines ranked 130th out of 190 countries in the World Bank’s 2020 Doing Business report.

The government of St. Vincent and the Grenadines strongly encourages foreign direct investment (FDI), particularly in industries that create jobs and earn foreign exchange.  Through the Invest St. Vincent and the Grenadines Authority (Invest SVG), the government facilitates FDI and maintains an open dialogue with current and potential investors.

The government does not impose limits on foreign control, nor are there requirements for local ownership or ownership in locally registered companies.  The island’s legal system is based on the British common law system.

St. Vincent and the Grenadines does not have a bilateral investment treaty with the United States.  It has double-taxation treaties with the United States, Canada, the UK, Denmark, Norway, Sweden, and Switzerland.

In 2016, St. Vincent and the Grenadines signed an intergovernmental agreement in observance of the United States’ Foreign Account Tax Compliance Act (FATCA), making it mandatory for banks in St. Vincent and the Grenadines to report the banking information of U.S. citizens.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2020 40 of 180 http://www.transparency.org/research/cpi/overview
World Bank’s Doing Business Report 2020 130 of 190 http://www.doingbusiness.org/en/rankings
Global Innovation Index 2020 N/A https://www.globalinnovationindex.org/analysis-indicator
U.S. FDI in partner country ($M USD, historical stock positions) 2019 7 https://apps.bea.gov/international/factsheet/
World Bank GNI per capita 2019 7,460 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD

1. Openness To, and Restrictions Upon, Foreign Investment

Policies Towards Foreign Direct Investment

The government of St. Vincent and the Grenadines, through Invest SVG, strongly encourages FDI, particularly in industries that create jobs and earn foreign currency.  The government is open to all investment, but is currently prioritizing investment in niche markets, particularly tourism, international financial services, agroprocessing, light manufacturing, creative industries, and information and communication technologies.

Invest SVG’s FDI policy is designed to attract investment into priority sectors.  It advises the government on the formation and implementation of policies and programs that attract and facilitate investment.  The government offers special incentive packages for foreign investments in the hotel industry and light manufacturing.  The government offers other incentive packages on an ad hoc basis.

Limits on Foreign Control and Right to Private Ownership and Establishment

There are no limits on foreign control in St. Vincent and the Grenadines, nor are there requirements for local investment or ownership in locally registered companies, although non-nationals must apply for a license from the Prime Minister’s Office to acquire more than 50 percent of a company.  An attorney must submit the application and Cabinet must approve it.  Companies holding at least five acres of land may restrict or prohibit the issue or transfer of their shares or debentures to non-nationals.

The government has not officially closed any industries to private investment, although some activities such as telecommunications, utilities, broadcasting, banking, and insurance require a government license.

Other Investment Policy Reviews

St. Vincent and the Grenadines is a member of the OECS. The OECS has not conducted a trade policy review in the last three years.

Business Facilitation

Invest SVG facilitates domestic and foreign direct investment in priority sectors and advises the government on the formation and implementation of policies and programs to attract investment.  Invest SVG provides business support services and market intelligence to all investors.  It also reviews all investment projects applying for government incentives to ensure they conform to national interests and provide economic benefits to the country.  Its website is http://www.investsvg.com.  In addition to its website, the country offers an online guide that is useful for navigating the laws, rules, procedures, and registration requirements for foreign investors.  The guide is available at http://theiguides.org/public-docs/guides/saintvincentandthegrenadines.

According to the World Bank’s 2020 Doing Business Report, St. Vincent and the Grenadines ranked 93rd of 190 countries in the ease of starting a business, which takes seven procedures and ten days to complete.  The general practice is to retain an attorney to prepare all incorporation documents.  A business must register with the Commerce and Intellectual Property Office (CIPO), the Ministry of Trade, the Inland Revenue Department, and the National Insurance Service.  The CIPO has an online information portal that describes the steps to register a business in St. Vincent and the Grenadines.  There is no online registration process, but the required forms are available online.  These must be printed and submitted to the CIPO.  More information is available at http://www.cipo.gov.vc.

Outward Investment

There is no restriction on domestic investors seeking to do business abroad.  Local companies are actively encouraged to take advantage of export opportunities specifically related to the country’s membership in the OECS Economic Union and the Caribbean Single Market and Economy (CSME), which enhances the competitiveness of the local and regional private sectors across traditional and emerging high-potential markets.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data:  BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $823 2019 825 www.worldbank.org/en/country
Foreign Direct Investment Host Country Statistical source* USG or international statistical source USG or international Source of data:  BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 7 BEA data available at
https://apps.bea.gov/
international/factsheet/
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2019 -1 BEA data available at
https://www.bea.gov/international/
direct-investment-and-multinational-
enterprises-comprehensive-data
Total inbound stock of FDI as % host GDP N/A N/A 2019 13.5 UNCTAD data available at
https://stats.unctad.org/handbook/
EconomicTrends/Fdi.html 

* Source for Host Country Data: Eastern Caribbean Central Bank https://eccb-centralbank.org/statistics/dashboard-datas/

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

Table 4: Sources of Portfolio Investment
Data not available.

Trinidad and Tobago

Executive Summary

Trinidad and Tobago (TT) is a high-income developing country with a gross domestic product (GDP) per capita of $17,397 and an annual GDP of $24.3 billion (2019). It has the largest economy in the English-speaking Caribbean and is the third most populous country in the region with 1.4 million inhabitants. The International Monetary Fund predicts GDP for 2021 will increase by 2.6 percent as the economy rebounds following the economic impact of coronavirus mitigation. TT’s investment climate is generally open and most investment barriers have been eliminated, but stifling bureaucracy and opaque procedures remain.

Energy exploration and production drive TT’s economy. This sector has historically attracted the most foreign direct investment. The energy sector usually accounts for approximately half of GDP and 80 percent of export earnings. Petrochemicals and steel are other sectors accounting for significant foreign investment. Since the economy is tethered to the energy sector, it is particularly vulnerable to fluctuating prices for hydrocarbons and petrochemicals.

Table 1: Key Metrics and Rankings
Measure Year Index/Rank Website Address
TI Corruption Perceptions Index 2020 86 of 175 http://www.transparency.org/research/cpi/overview 
World Bank’s Doing Business Report 2020 105 of 190 http://www.doingbusiness.org/en/rankings 
Global Innovation Index 2020 98 of 131 https://www.globalinnovationindex.org/analysis-indicator 
U.S. FDI in partner country ($M USD, historical stock positions) 2019 $6,200 https://apps.bea.gov/international/factsheet/ 
World Bank GNI per capita 2019 $17,010 http://data.worldbank.org/indicator/NY.GNP.PCAP.CD 

1. Openness To, and Restrictions Upon, Foreign Investment

Policies Towards Foreign Direct Investment

The government of Trinidad and Tobago seeks foreign direct investment and has traditionally welcomed U.S. investors.

The U.S. Mission is not aware of laws or practices that discriminate against foreign investors but some have seen the decision-making process for tenders and the subsequent awarding of contracts turn opaque without warning, especially when their interests compete with those of well-connected local firms.

InvesTT is the country’s investment promotion agency that assists investors through the process of setting up a non-energy business and provides aftercare services once established. Specifically, it provides market information; offers advice on accessing investment incentives; and assists with regulatory and registry issues; property and location services; creation of business linkages; problem solving; and advocacy to the government. The Trinidad and Tobago International Financial Center is another investment promotion agency whose mission is to attract and facilitate foreign direct investment in the financial services sector.

While Trinidad and Tobago prioritizes investment retention, the U.S. Mission is not aware of a formal, ongoing dialogue with investors, either through an Ombudsman or formal business roundtable.

Limits on Foreign Control and Right to Private Ownership and Establishment

Foreign and domestic private entities have the right to establish and own business enterprises and engage in all forms of remunerative activity.

There are no limits on foreign ownership. Under the Foreign Investment Act of 1990, a foreign investor is permitted to own 100 percent of the share capital in a private company. A license is required to own more than a 30 percent of a public company.

The U.S. Mission is not aware of any sector-specific restrictions or limitations applied to U.S. investors.

Trinidad and Tobago maintains an investment screening mechanism for foreign investment related to specific projects that have been submitted for the purpose of accessing sector-specific incentives, such as for those offered in the tourism industry.

Other Investment Policy Reviews

The World Trade Organization conducted a trade policy review for Trinidad and Tobago in 2019: https://www.wto.org/english/tratop_e/tpr_e/tp488_e.htm 

Business Facilitation

The government’s business facilitation efforts focus primarily on investor services (helping deal with rules and procedures) through its investment promotion agency and trying to make the rules more transparent and predictable overall. However, more work needs to be done to achieve efficient administrative procedures and dispute resolution. Trinidad and Tobago ranks 158th of 190 countries for registering property, 174th for enforcing contracts, and 160th for payment of taxes in the World Bank’s Doing Business 2020 report, representing a deterioration of indicators that reflect a difficulty of doing business.

The business registration website is: www.ttbizlink.gov.tt . The Global Enterprise Registration Network (GER) gives the TT business registration website a below-average score of 3 out of 10 for its single electronic window, and 4.5 out of 10 for providing information on how to register a business (TTconnect.gov.tt). While the process is clear, the inability to make online payments, and submit certificates online requests are the two main reasons for the low score. A feedback mechanism allowing users to communicate with authorities is a strength of the TT business registration website. Foreign companies can use the website and business registration requires completion of seven procedures over a period of 10 days. The agencies with which a company must typically register include:

  • Companies Registry, Ministry of Legal Affairs
  • Board of Inland Revenue
  • National Insurance Board; and
  • Value Added Tax (VAT Office, Board of Inland Revenue)

Outward Investment

The host government does not promote or incentivize outward investment.

The host government does not restrict domestic investors from investing abroad.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics

 

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy
Host Country Statistical source* USG or international statistical source USG or International Source of Data: BEA; IMF; Eurostat; UNCTAD, Other
Economic Data Year Amount Year Amount
Host Country Gross Domestic Product (GDP) ($M USD) 2019 $2,310 2019 $2,430 www.worldbank.org/en/country 
Foreign Direct Investment Host Country Statistical source USG or international statistical source USG or international Source of data: BEA; IMF; Eurostat; UNCTAD, Other
U.S. FDI in partner country ($M USD, stock positions) N/A N/A 2019 $6,249 BEA data available at https://apps.bea.gov/international/factsheet/ 
Host country’s FDI in the United States ($M USD, stock positions) N/A N/A 2019 $69 BEA data available at https://www.bea.gov/international/direct-investment-and-multinational-enterprises-comprehensive-data 
Total inbound stock of FDI as % host GDP N/A N/A 2019 1% UNCTAD data available at https://stats.unctad.org/handbook/EconomicTrends/Fdi.html 

* Source for Host Country Data: Trinidad and Tobago Central Bank:  Homepage | Central Bank of Trinidad and Tobago (central-bank.org.tt)

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

Table 4: Sources of Portfolio Investment
Data not available.

Investment Climate Statements
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The Lessons of 1989: Freedom and Our Future