Investing in dying industries is not normally a smart thing to do… unless you can get some benefit from a government by doing so. Here’s one of those cases.
In 2005 the WTO and European Union withdrew preferences given to the Eastern Caribbean Sugar Industry, thereby effectively closing it down, since Caribbean sugar could not compete with bigger producers in the Caribbean and further afield.
As a consequence of this, the government of St Kitts and Nevis, a group of islands in the Eastern Caribbean, would like to “diversify the agricultural sector and to stimulate the development of other sectors of the economy.” They set up a Foundation with this aim, The Sugar Industry Diversification Foundation (SIDF), in 2006. And they are offering a very big bonus to you if you are prepared to help them financially with this task – you can obtain a second citizenship and passport for yourself and your family almost immediately.
As regular Q Wealth Report readers know, there are only two countries in the world offering so-called Economic Citizenship programs – that is, the chance to buy a legal second citizenship and passport within a matter of weeks. One is The Commonwealth of Dominica (an English-speaking Caribbean nation, not to be confused with the Dominican Republic) and the other is Saint Kitts and Nevis. The difference between the two citizenship programs is that in the past Dominica required a “non-refundable investment” paid direct to the government, whereas St Kitts required the purchase of real estate, worth at least $350,000, in specific designated projects.
Many people were put off the St Kitts program due to the real estate investment. Let’s face it, some of us a real estate investors and some are not. Whilst it could be a good deal long term, and there was some chance of seeing your money back again one day, coming up with $400,000 for the privilege of owning real estate on a hurricane-prone island can be a hassle, especially if you never plan to live there. For a lot of people, it was more attractive just to pay once up front, get the second passport and forget the hassles.
So the authorities in the St Kitts capital, Basseterre, came up with an alternative. Although the real estate investment option is still valid, instead of buying real estate, you can now choose to make a one time donation to the Sugar Industry Diversification Foundation. This requires substantially less up-front capital, as the contribution required is $200,000.
A little history: the Citizenship Program was established in 1984, which makes this the longest established citizenship-by-investment program. Regulations regarding citizenship-by-investment are contained in Part II, Section 3 (5) of the Citizenship Act, 1984. The actual government policies with regard to the Citizenship-by-Investment program (such as investment requirements etc.) are set by Government through Cabinet Decision.
The principal advantages according to press releases put out by the St Kitts government are:
· Citizenship is valid for life, for the applicant and all eligible family members.
· Dual Citizenship is permitted, without the requirement to notify the applicants home country, and without any need for the applicant to reside in St Kitts and Nevis.
· Passports can be issued to the applicant an all eligible family members, and may be easily renewed via a worldwide network of consulates.
· St Kitts citizens enjoy a wide range of visa-free travel:- Austria, Belgium, Britain, Canada, Denmark, Finland, France, Germany, Iceland, Italy, Greece, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and most British commonwealth countries. When a visa is required, they are also relatively easy to obtain.
· New citizens qualify for full residency status including the right to work in St. Kitts and Nevis
· Perhaps best of all: Tax Free Status on foreign income, capital gains, gift, wealth and inheritance tax
To qualify for Citizenship-by-Investment via the Sugar Industry Diversification Foundation, there are four different categories:
A. Single applicant: US$ 200,000 contribution required
B. Applicant with up to three dependants (i.e. one spouse and two children below the age of 18): US$ 250,000 contribution required
C. Applicant with up to five dependants (i.e. one spouse and four children): US$ 300,000 contribution required
D. Applicant with six and more dependants: US$ 400,000 contribution required.
In each of these categories, the total amount includes all government and due diligence fees. The documentation required for an application is strict but reasonable, and the application procedure is well organized.
Note: The above article is adapted from one that originally appeared on the Global Nomads Campfire Blog. If you would like further information, read the Global Nomads Caribbean Offshore Contacts Report “Offshore and Sunny” for recommended citizenship consultants and other Caribbean contacts. Members may also contact the Q Wealth offices in London for referrals and advice.