Minister of Financial Services of the Bahamas, Ryan Pinder, opined that his country lacked the social maturity to enjoy the benefits of a Citizenship by Investment program. According to him, such a program would attract high net-worth individuals to the country and provide a significant boost to the economy.
The Minister opined that the difficult political environment combined with the tendency to take decision on emotional grounds as opposed to pragmatic grounds were the biggest obstacles in the implementation of investment immigration initiatives.
Speaking at the Nassau Conference, the Minister spoke of how he had tried to make the Bahamas a signatory to the Caribbean Single Market and Economy, and how such efforts failed due to the notion that free movement of Caribbean nationals was a threat to the Bahamas.
The Minister was of the opinion that some sections of the population may not have the maturity to accept a program that offered citizenship through investment. Further, he said that allowing such investor citizens to enjoy the right to vote was a challenging issue with no clear consensus.
Mr. Pinder pointed out that even equitable referendums related to the Constitution of the Bahamas were challenged, and stated that a charged environment where voter turnout is as high as 93% resulted in numerous challenges in the implementation of a Bahamian Investor Citizenship program.
Referring to constitutional referendums attempted in recent times, the Minister indicated that even minor obstacles turn into significant roadblocks that prevented the implementation of a credible and functional program offering citizenship in lieu of investment.
The Minister’s attempt to blame local political obstacles for non-implementation of an investment immigration program attracted criticism from attorneys and immigration experts who had been seeking the establishment of such a program in the Bahamas.
Experts cited the instance of the recent Scottish referendum to emphasize that every decision of the government involved political consequences and that such factors should not affect the Government’s support to the Investor Citizen initiative.
Allaying fears of misuse of such programs, attorneys pointed out that countries like St. Kitts and Nevis had not become a haven for drugs and arms dealers despite running allowing citizenship through investment for the past three decades.
A key advisor to Perry Christie, the Bahamian Prime Minister, had publicly urged the country to grant citizenship to investors. Such a program will involve encouraging high net-worth individuals from all over the world to setup their domicile in the Bahamas resulting in creation of assets in the country. In course of time, such citizens and their families will contribute significant investments to the economy resulting in creation of employment in the economy. Supporters of the initiative have emphasized the potential transformative effect of such a program on the Bahamian economy.
While this recommendation found support amongst the private sector, especially the financial services industry, many critics argued that citizenship to the Bahamas should be earned and not simply purchased. Facing political costs and risking angering the nationalist sentiment, the Government has adopted a cautious approach in passing the necessary laws and policy changes to make this program a reality.
While the issue of citizenship through investment in the Bahamas remains under a cloud, the option of obtaining permanent residency through investment remains a functional and viable option with the Minister clarifying that there are no plans to review the minimum $500,000 requirement of investing in residential real estate.
Admitting that real estate developers are lobbying for an increase, Mr. Pinder reiterated the government’s position that the investment limit will not be raised for the time being.
Praising his Government’s permanent residency program, Mr. Pinder opined that the Bahamas, unlike other countries, allowed investors obtaining permanent residency to run their business in the country. This, according to the Minister, made the Bahamas an attractive destination for China and other Asian countries where foreign exchange restrictions on businesses are less severe as compared to the restrictions on individuals.
Another advantage that the Minister highlighted was the fact that applying for annual residence for a period of up to five years was a simple affair without cumbersome formalities. The Minister described this option as a good way to get introduced to the option of permanent residency. The Minister further highlighted that investors could benefit from the fact that they would not fall within the scope of regional and international tax information exchange mechanisms.
On the question of allowing investors to invest in government bonds in the Bahamas, the Minister opined that such a move was more suitable for those applying for annual residency as opposed to those seeking permanent residency.
He said an investment of $1 million in government bonds could help the investor enjoy annual residency for a period of five years. The investment would be utilized for creating educational and social infrastructure and would encourage the government to respond favorably to the permanent residence application, if the investor is desirous of residing in the Bahamas.
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