2019 Investment Climate Statements: Grenada

Policies Towards Foreign Direct Investment

Grenada employs a liberal approach to FDI.  The strategic agenda of the government of Grenada demonstrates its belief that investment is directly related to growth and development.  As a result, the government of Grenada identified additional foreign investment opportunities related to the country’s resource endowment of “sand, sun, sea and rich fertile soil.”  The government of Grenada’s accession to international trade and development agreements opened a greater number of sectors to foreign investment opportunities.

The GIDC is the country’s investment promotion agency.  It was established by Grenada in 1985 as a statutory body to stimulate, facilitate, and encourage the creation and development of industry.  Through an act of parliament, the name was changed to Grenada Investment Development Corporation in 2016 to convey its mandate more clearly. The GIDC is comprised of three strategic business units responsible for carrying out its core responsibilities. They are:

1. Investment Promotion Agency: responsible for investment promotion facilitation;
2. Business Development Centre: provides business support services to micro-, small and medium-sized enterprises; and,
3. Facilities: manages the three business parks owned by the GIDC.

A fourth unit, “shared services,” provides financial, human resource management, legal, research, and monitoring and evaluation support to the Strategic Business Units.  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

In an effort 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 enabling environment for investors to develop and grow businesses, trade, and industries.

Investment retention is a priority in Grenada.  This is maintained through ongoing dialogues 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. 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.  Foreign investors may not invest in or operate investment enterprises that are prejudicial to national security or detrimental to the environment, public health, or the national culture, or which contravene the laws of Grenada.  Grenada has accepted but not yet implemented regional obligations on anti-competition concerns. U.S investors are not disadvantaged or singled out by any of the ownership or control mechanisms, sector restrictions, or investment screening mechanisms in Grenada relative to other foreign investors.

Other Investment Policy Reviews

Grenada passed its most recent Investment Promotion Act in 2014, replacing the 2009 Act.  The new 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.

In 2016, parliament approved a new incentives regime.  The new regime involved amendments to specific legislation that grants incentives.  This was devised to ensure that all new tax exemptions are codified in legislation. It also restricted discretionary exemptions and required that the beneficiaries of exemptions file appropriate tax returns and comply with tax requirements.

It also proposes a streamlined, simple, and non-discretionary system/process for the granting of incentives.  The Customs and Inland Revenue Departments administer exemptions through a clearly defined rule-based system, rather than the very open-ended incentive schemes that previously required each case to be approved at the cabinet level.

Under the new regime, incentives will be granted to projects within the priority sectors for investment.  They are tourism; manufacturing; agriculture and agribusiness; information technology services; telecommunication providers and business process outsourcing operations; education and training; health and wellness; creative industries; energy; and research and development.  Other sectors also include student accommodation; heavy equipment operators; investment projects above particular investment thresholds; and projects within specific geographical locations.

The new incentive regime seeks to provide investment incentives on a performance basis (i.e. the more one invests, the more incentives one can receive).  Therefore, based on the level of investment, different levels of incentives will be granted in a transparent, open, predictable, and non-discriminatory manner.

In the past three years, the government did not undergo any third-party investment policy reviews through multilateral organizations such as the Organization for Economic Cooperation and Development (OECD), the WTO, and the United Nations Conference on Trade and Development.

Business Facilitation

Political and economic stability, human resource capacity, supportive government policies, trade and investment opportunities, quality of life, and good infrastructure provide a positive environment for FDI in Grenada.

An investor must register a business name and identify whether it is a partnership or limited liability company.  A registered business can be wholly owned or a joint venture. The official website of the GIDC includes an investor’s guide that details the procedures for starting and operating a business in Grenada.  The guide has a business procedure flow chart and gives step-by-step instructions for various tasks from registering a business and owning properties to obtaining permits and licenses. Detailed information on business registration and timelines can be found at: http://grenadaidc.com/investor-centre/investors-guide/starting-up-a-business/#.WKxXdfnQe70  

The GIDC provides business facilitation mechanisms and ensures the equitable treatment of women and underrepresented minorities in the economy.

Outward Investment

The government of Grenada does not promote or incentivize outward investment.  However, under the Revised Treaty of Chagaramus, there are Rights of Establishment in any CARICOM member state.  There is also a chapter on service agreements under the 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.

Bilateral Investment Treaties 

Bilateral Investment Agreements established between Grenada and several countries are designed to encourage and protect international investments and to ensure that investors receive fair, equitable, and nondiscriminatory treatment.  Bilateral Investment Treaties exist between Grenada and the United States as well as Grenada and the UK.

Grenada is a member of CARICOM, established by the Treaty of Chagaramus in 1973 to promote economic integration and development among its 15 member states.  The Revised Treaty of Chagaramus later established the CARICOM Single Market and Economy (CSME) to provide for the free movement of goods, services, capital, and labor within member states.

Grenada is also a member of CARIFORUM and party to the EPA between the EU and CARICOM member states.  This agreement aims to alleviate poverty, foster regional integration, promote economic cooperation, and propel CARIFORUM states’ entry into the world economy by creating an attractive investment climate and ensuring trade viability on the world market.

Grenada is also a member of the Caribbean-Canada Trade Agreement (CARIBCAN), an agreement between the Canadian government and the Commonwealth Caribbean nations to promote trade, investment, and industrial cooperation.  Treaties with investment provisions also exist through the CARICOM-Costa Rica free trade agreement (FTA), CARICOM-Cuba Cooperation Agreement, CARICOM-Dominican Republic FTA and CARICOM-Venezuela FTA.

There is also an agreement with the Caribbean Basin Initiative (CBI), an initiative created by the United States with the Caribbean and Central America to provide several trade and tariff benefits, among others.

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

In 2018, Grenada signed a bilateral Open Skies Agreement with the United States.  This agreement replaces the 1946 Bermuda I Agreement, and ensures a more current, responsive, and beneficial arrangement that is reflective of modern civil aviation trends.  It will liberalize the aviation market, remove various restrictions, increase capacity and number of routes, and improve the ease of travel to and from Grenada by attracting additional air carriers and routes.

Bilateral Taxation Treaties 

Grenada passed legislation that will implement the Foreign Account Tax Compliance Act Inter-Governmental Agreement (FATCA) with the United States.  FATCA requires that information on U.S. citizens with accounts at local financial and credit institutions holding in excess of XCD USD 50,000 be shared with the U.S. Internal Revenue Service (IRS).  The legislation provides for the Competent Authority to be the Comptroller of Inland Revenue, who will communicate directly with the IRS. The Comptroller will mandate his/her staff to gather information from financial institutions to be divulged to the IRS.  According to the legislation, “failure to comply with such a request is a summary offence punishable by a fine not exceeding USD 100,000.”

The legislation also provides for the protection of privacy, stating that the Competent Authority must protect confidential account information. Other than FATCA, the United States does not have a tax treaty with Grenada.

Transparency of the Regulatory System

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

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

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

Tax, labor, environment, health and safety, and other laws or policies do not distort nor impede investment.  In theory, bureaucratic procedures, including those for licenses and permits, are sufficiently streamlined and transparent.  In practice, local authorities recognize that the implementation of procedures can sometimes be slow.

Legal, regulatory, and accounting systems are generally transparent and consistent with international norms.  Public finances and debt obligations, including explicit and contingent liabilities, are also transparent and in keeping with international requirements.  There are clear institutional arrangements established to support the implementation of transparent regimes governing investment.

International Regulatory Considerations

Grenada has been a member of the WTO since 1996 and is a party to agreements established under the organization.  In pursuit of WTO compliance, Grenada recently signed, and is in the process of negotiating, trade and investment agreements that contain provisions better aligned with the provisions of the WTO.  Grenada is a member of CARICOM and the Caribbean Single Market Economy (CSME), which adheres to the international norms and regulatory standards outlined by the WTO.

Legal System and Judicial Independence

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

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

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

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

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

Laws and Regulations on Foreign Direct Investment

The economy is supported by a strong legislative and regulatory framework that encourages FDI and promotes investment initiatives.  Grenada augmented the investment climate with a revitalization of its Citizenship by Investment (CBI) program. That program generated investments of XCD 81.1 million (USD 30.4 million) in 2017, providing financing for a number of developments in the tourism sector.

In 2016, parliament passed several legislative changes to promote investment:

• Value Added Tax Amendment Act – This Act amended the Value Added Tax Act Cap.333A to provide for VAT exemptions for qualifying investments in priority sectors and should be applied in conjunction with regulations made pursuant to the Investment Act of 2014 to determine what the priority sectors are for economic growth.
• Excise Tax Amendment Act – This Act amends the Excise Tax Act Cap. 94 to provide for tax incentives for investors engaged in manufacturing and investors entitled to conditional duties exemptions for motor vehicles.
• Property Transfer Tax Amendment Act – This Act amends the Property Transfer Tax Act Cap. 257C to provide more favorable rates of property transfer tax for investors. The Property Transfer Tax (Amendment) Act, 2015 (No. 23 of 2015) reduced the property transfer tax payable by non-citizens with qualifying investments from 10 percent to 5 percent.  This Act expands this incentive and would be applied in conjunction with regulations made pursuant to the Investment Act for the establishment of priority sectors for economic growth.
• Customs Service Charge Amendment Act – This Act amends the Customs (Service Charge) Act Cap. 75D to remove the discretionary power of cabinet to prescribe varying rates of customs service charge (CSC) and to prescribe a new rate of CSC applicable to investors engaged in manufacturing.
• Investment Amendment Act– This Act provides for specified circumstances under which the Minister of Finance may make regulations under the principal Act.
• Bankruptcy and Insolvency Amendment Act – This Act modernized the law relating to bankruptcy and insolvency of individuals and companies. The Bankruptcy Act, which applies only to individuals, was repealed.  Provisions in other Acts, such as the Companies Act, dealing with liquidation or winding up, continue to apply. The Act is based on the Canadian Bankruptcy and Insolvency Act, which has been used as a model in a number of Caribbean countries.
• Income Tax Amendment Act– This Act amended the Income Tax Act Cap. 149 to provide for a waiver on withholding tax applicable on specified types of repatriated funds relating to investors engaged in tourism accommodation or health and wellness, among other matters.

The GIDC, together with the Inland Revenue and Customs Departments of Grenada, works to ensure adherence to the rule of law and to facilitate the procedures outlined in the revised investment regime.  The legal and regulatory framework governing foreign direct investment in Grenada is described here: http://grenadaidc.com/investor-centre/investors-guide/starting-up-a-business/#.WLA0BfnQe70  

Competition and Anti-Trust Laws

There are no laws that regulate competition in Grenada.  However, Grenada discussed model draft bills at the CARICOM and Organization of Eastern Caribbean States (OECS) levels.  These drafts are being formulated to strengthen market regimes under the CSME. CARICOM established a Competition Commission and plans are underway to establish a sub-regional Eastern Caribbean Competition Commission.

Expropriation and Compensation

According to the Constitution, Grenada shall not compulsorily acquire or take possession of any investment or any asset of an investor except for a purpose which is legal and non-discriminatory.  If the government expropriates property for a legal purpose, it must promptly pay adequate and effective compensation. Owners of expropriated assets have the right to file claims in the High Court regarding the amount of compensation or ownership of the expropriated asset.  In 2016, parliament repealed the 1994 Electricity Supply Act and opened the market to potential investors who will transition to alternative sources of power generation, decreasing costs, reducing dependence on imported fossil fuels, and improving energy efficiency. The 2016 Electricity Supply Act allows a new government-run regulatory body to grant multiple licenses to energy generators.

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

Dispute Settlement

ICSID Convention and New York Convention

Grenada is a signatory and contracting member of the International Center for Settlement of Investment Disputes since 1991, and has engaged this platform to resolve past disputes. While Grenadian laws have adapted the provisions outlined in the New York Convention, the country is not a contracting state and has not ratified the convention.

Investor-State Dispute Settlement

There were no known investment disputes involving a U.S. person over the past 10 years.

There is no history of extrajudicial action against foreign investors.

International Commercial Arbitration and Foreign Courts

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

There is no government interference in the court system.  Grenada participates in a court-connected mediation mechanism that can be accessed through the Mediation Centre.  This Centre was established by the statutory provisions of the Practice Direction Act No.1 of 2003. It extends court-connected mediation to all member states of the OECS and allows for civil actions filed in court to be referred to mediation.  Through this system, parties can utilize alternative dispute resolution mechanisms, including mediation, if the court deems them to be appropriate mechanisms for resolving the case.

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

Bankruptcy Regulations

Grenada is ranked 168 out of 190 for ease of resolving insolvency in the World Bank’s Doing Business Report for 2019, the same ranking it received in 2018.

Chapter 27 of the Bankruptcy Act (Amended by Act No. 10 of 1990) makes provisions for all aspects of bankruptcy.  This was one of the laws recently amended under the new investment regime to modernize the law relating to bankruptcy and insolvency of individuals and companies.

Part III of this Act sets out what constitutes bankruptcy and the procedure for creditors to apply to the High Court for a bankruptcy order against a debtor and the appointment of a trustee in bankruptcy.  There are also provisions for the court to appoint an interim receiver pending the outcome of the application for a bankruptcy order.

Part III also has provision for a process whereby an insolvent person, with leave of the court, may make an assignment of the insolvent person’s property for the general benefit of creditors of the insolvent person.

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

Investment Incentives

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

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

Incentives include accelerated depreciation (10 percent on physical plant and machinery; 2 percent on industrial buildings); investment allowance (100 percent write-off on total investment); carry forward of losses for three years; reductions in the property transfer tax; 100 percent relief from customs duties on physical plant, equipment, and raw materials; and deduction of expenditures incurred for training, research, and development.

Other incentives include no restrictions on foreign ownership; no restrictions on foreign currency transactions; and no restrictions on the repatriation of profits, capital, and dividends.  Certain incentives may be linked to the site of investment, the number of persons employed, or other factors. There was no instance that Grenada needed to review an approved investor for non-compliance with incentive requirements.

Grenada does not have a practice of issuing guarantees or jointly financing foreign direct investment projects.

Foreign Trade Zones/Free Ports/Trade Facilitation

There are no foreign trade zones or free ports in Grenada. However, there are various companies which offer duty free shopping for travelling customers.

Performance and Data Localization Requirements

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

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

The approval process takes two to three weeks, longer if there are questions, and is valid for one year.  U.S. investors and workers are required to pay USD $1,111 or XCD $3,000 per year for renewal.

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

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

Real Property

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

The 2011 appointment of a registrar who focuses specifically on property has reduced the time needed to transfer property in Grenada by almost half.

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

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

Grenada ranked 146 out of 190 for the ease of registering property on the World Bank’s 2019 Doing Business Report.

Intellectual Property Rights

Intellectual property protection in Grenada is governed by the Patents Act (Cap. 227 of the Consolidated Laws of Grenada), the Trade Marks Act (Cap. 284 of the Consolidated Laws of Grenada), and the Copyright Act Cap. 32 of 1988 (Cap. 67 of the Consolidated Laws of Grenada).  Investors and investment enterprises can seek protection of their patents, trademarks, brand names, and copyrighted materials in printed, recorded, or electronic formats. Grenada is a member of the World Intellectual Property Organization (WIPO), the Paris Convention, the Berne Convention, and the Patent Cooperation Treaty.

Domestic legislation regarding intellectual property protection has not been fully amended to comply with the Trade-Related Aspects of Intellectual Property Rights (TRIPs) Agreement.  However, updates to existing legislation are currently being drafted and reviewed. The government of Grenada has implemented the Trademark Act No. 1 of 2012 and the Copyright Act of 2011.

The Patent Act of 2011 has been enacted but the implementing regulations are currently under review.

The geographic location bills have been drafted and are currently awaiting approval in parliament.  The Industrial Design Bill is reportedly a priority for 2020. Once these outstanding matters have been addressed, Grenada’s protection of intellectual property rights will be fully consistent with TRIPs.

Administration of intellectual property laws in Grenada is under the responsibility of the Ministry of Legal Affairs.

The registration of patents, trademarks, and copyrights is conducted at the Corporate and Intellectual Property Office.  Grenada operates a re-registration system based on registration in the United Kingdom. The Registration of the United Kingdom Patents Act, Cap. 283 and Grenada’s Patent Act No. 16 of 2011 govern Grenada’s system for registering patents.  In accordance with the legislation, based on Section 91 of the UK’s Patents and Design Act of 1907, any patent holder in the United Kingdom may apply within three years from the date of issue of the patent to have it registered in Grenada.

The United Kingdom Trade Marks Act, Cap. 284, authorizes any proprietor of a trademark in the United Kingdom to apply at any time during the existence of the registration to have it registered in Grenada.

Grenada is not listed in the 2019 Special 301 Report or on the Notorious Markets List.

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

Capital Markets and Portfolio Investment

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

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

Money and Banking System

The Financial Industry in Grenada is regulated by two entities: the Eastern Caribbean Central Bank (ECCB) and the Grenada Authority for Regulation of the Financial Industry (GARFIN).  The ECCB regulates the banking system. GARFIN oversees non-banking financial institutions through a regulatory system that encourages and facilitates portfolio investment. The estimated total assets of the largest banks is USD $1.03 billion.  Information on the percentage of non-performing assets is not available. Grenada has not experienced cross-shareholding or hostile takeovers.

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

There is correspondent banking available with all licensed commercial banks.  No correspondent banking relationships have been lost in the past three years, nor is there any correspondent banking relationships in jeopardy currently.  There are no restrictions on a foreigner’s ability to establish a bank account.

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

Foreign Exchange and Remittances

Foreign Exchange

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

There are no restrictions or limitations placed on foreign investors in converting, transferring, or repatriating funds associated with investment.  Funds associated with any form of investment can be freely converted into a number of currencies including U.S. dollar, pound sterling, Canadian dollar, and Euros.  However, banks reserve the right to delay transactions if deemed suspicious or outside the typical level of activity on the account.

Remittance Policies

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

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

Sovereign Wealth Funds

Grenada does not have a sovereign wealth fund.

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

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

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

Privatization Program

Grenada does not have a privatization program

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

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

While firms that promote CSR are more favorably viewed by the community, there is little familiarity with international CSR standards.  Activities are deemed to be responsible business conduct as long as they are lawful, not a threat to national security, and not detrimental to the environment, health, and culture of the Grenadian people.

There have been no high profile, controversial instances of private sector impact on human rights or resolution of such cases in the recent past.

Grenada effectively and fairly enforces domestic laws in relation to human rights, labor rights, consumer protection, environmental protection, and other laws/regulations intended to protect individuals from adverse business impacts.  Additionally, local labor unions play a role in promoting and monitoring responsible business conduct.

Grenada is a party to the Inter-American Convention against Corruption.  In 2013, parliament passed the Integrity in Public Life Act (Act No.24 of 2013), the country’s first anticorruption bill.  It requires that all public servants report their income and assets to the independent Integrity Commission for review.

The Ombudsman Act of 2007 established the Office of Ombudsman.  The country’s first Ombudsman since independence was appointed in September 2009.  The Office aims to provide effective service, handle complaints in a timely manner, and ensure the highest level of confidentiality and impartiality.

In 2017, the Ombudsman received 40 complaints, compared to 94 in 2016. Of the 40 complaints, six were closed, 28 are ongoing, advice was given for three, two were discontinued, and one was outside the Ombudsman’s jurisdiction.  The Royal Grenada Police Force received the highest number of complaints, totaling seven. Of those, four cases are ongoing while the other three were either closed, discontinued, or received advice.

Bribery is illegal in Grenada, and Grenadian officials take seriously any allegations.  The Integrity in Public Life Commission monitors and verifies disclosures, although disclosures are not made public except in court.  According to the provisions of the bill, failure to file a disclosure should be noted in the Official Gazette. If the office holder in question fails to file in response to this notification, the commission can seek a court order to enforce compliance.  For the most part, the enforcement of these laws and procedures are effective and are applied in a non-discriminatory manner.

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

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

Resources to Report Corruption

Contacts at government agency or agencies who are responsible for combating corruption:

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

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

Contact at “watchdog” organization:

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

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

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

Employers are generally expected to recognize a union that represents the majority of workers, but are not obligated to recognize a minority union formed by some employees if the majority of the workforce does not belong to said union.  In accordance with the Trade Union Recognition Act No 29 of 1979 (Cap. 325 of the Consolidated Laws of Grenada), investors shall grant union representation at any site of employment if the majority of their employees indicate the desire for union representation.  Investment enterprises are also required to contribute to the social insurance and welfare programs for their workers in accordance with the National Insurance Act.

With regard to essential services, the Ministry of Labor in its discretion may refer the disputes to compulsory arbitration.  Essential services include employees of utility companies; public health and protection sectors, including sanitation; and airport, seaport, and dock services.

Grenada does not restrict the legal activities of trade unions.  The majority of the workforce is unionized, and the labor relations atmosphere on the island is generally stable.

Article 32 of the Employment Act prohibits employment of children under the age of 16 except for temporary holiday employment.  Part 7 of the Employment Act provides for the protection and regulation of wages, and article 52 mandates the minimum wage. Minimum wage schedules are set by occupation.

Preliminary results from the 2018 Labor Force Survey indicated that the unemployment rate fell by 2.7 percent, moving from 23.6 percent in December 2017 to 20.9 percent in June 2018.

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

No new labor-related laws or regulations were enacted during the last year, and no bills are pending. While there was a revision to the Labor Code in 2016, this revision was not enacted due to employers’ concerns.

Grenada acceded to the U.S. Overseas Private Investment Corporation (OPIC) in 1968.  Through investment guarantees issued by the U.S. government and other programs, OPIC seeks to encourage private investments in projects that will contribute to the development of Grenada’s economic resources and productive capacities.

Grenada is eligible for assistance via the Clean Energy Finance Facility for the Caribbean and Central America, a financing mechanism supported by OPIC, the U.S. Agency for International Development, the U.S. Trade and Development Agency, and the U.S. Department of State.  For more on this program, see: www.opic.gov/opic-action/renewable-resources/caribbean-renewables  .

Table 2: Key Macroeconomic Data, U.S. FDI in Host Country/Economy

* Source for Host Country Data: Grenada Ministry of Finance Statistical Department. Data as of December 31, 2018.

Table 3: Sources and Destination of FDI

Information for Grenada is not available on the IMF’s Coordinated Direct Investment Survey (CDIS) site. Host country data is also not available.

Table 4: Sources of Portfolio Investment

Information for Grenada is not available on the IMF’s Coordinated Portfolio Investment Survey site for Sources of Portfolio Investment. Host country data is also not available.

Rachel Meyers
Deputy Political/Economic Counselor
U.S. Embassy Bridgetown
Telephone: (246) 227-4000
Email: meyersrl@state.gov

Rachér Croney
Economic/Commercial Assistant
U.S. Embassy Grenada
Telephone: (473) 444-1173
Email: croneyrr@state.gov

Contacts for Investment-Related Inquiries:
Ronald Theodore