In the face of tight lending, several island nations in the Caribbean are financing their resort and villa projects by selling citizenship.<\/p>\n
The vacation-home market of the Caribbean has seen many upheavals while recovering from the economy\u2019s downturn. In larger markets and those with direct flights to the US, sales volume and prices for existing houses have increased. However in smaller nations that are avoided by the conventional lenders, the sale of villas and new construction of resorts is following an uneven trend.<\/p>\n
Some of these islands like St. Kitts and Nevis, Grenada, and Antigua and Barbuda have resorted to the solution of granting citizenship to qualified investors who can invest several hundred thousand dollars in property or hotel projects.<\/p>\n
Such an arrangement helps the islands, which can thus get their tourist destinations constructed, whereas the investors benefit from Caribbean passports.<\/p>\n
These programs are especially very popular among Chinese investors, who need a visa in addition to their country passports in order to travel to several countries. The Caribbean passports would allow them to travel visa-free in many cases.<\/p>\n
The investors also benefit by paying lower taxes as Caribbean-nation citizens, compared to what they would need to pay in their home countries. But for this they might need to reside for a certain duration in the Caribbean nation each year.<\/p>\n
The Caribbean often faces difficulties in obtaining conventional financing. They struggle with fickle tourism demand and limited airline services, besides damages caused by tropical storms. In the past few years, conventional lenders have been especially wary of the Caribbean nations after many high-profile resort projects ran out of financing due to the economic downturn.<\/p>\n
The developers of the 2,500-acre Christophe Harbour resort in St Kitts and Nevis have benefited from the government\u2019s citizenship-by-investment program to sell several of its first hundred home sites during the past two years and to finance the construction of the Park Hyatt luxury hotel there.<\/p>\n
In St. Kitts, the minimum investment required by investors to get citizenship is $400,000. The house prices at Christophe Harbour range from $500,000 to $6 million. The total population of St Kitts and Nevis stands at 55,000.<\/p>\n
\u201cIt isn\u2019t easy to find buyers, especially in the economy we\u2019ve had since the downturn. But citizenship has driven a recession-proof demand to this tiny island,\u201d says Christophe Harbour\u2019s Thomas Liepman.<\/p>\n
Last year Grenada, an island nation with 106,000 residents, started its citizenship-by-investment program. It was initiated to finance the 22-villa Mount Cinnamon Resort and Beach Club. This project\u2019s developer is Peter de Savary (British hotelier), who plans to construct 80 more villas on the site by soliciting investors who want to get a Grenadian citizenship.<\/p>\n
Although there are American buyers of these properties, however they are not enough to finance such projects. Most investments come from people who encounter travel restrictions and therefore are looking for a more travel-friendly passport.<\/p>\n
\u201cThey\u2019re marketing to people who are Russian, Middle Eastern or Chinese. They get a [Caribbean] passport, and they don\u2019t even have to live there,\u201d says James Andrews of Integra Realty Resources Inc., a valuation and consulting firm.<\/p>\n
Other countries like St. Lucia, Barbados, and Bermuda are contemplating the benefits of offering citizenship-by-investment programs as they fear they might fall behind in tourism development if they don\u2019t do so.<\/p>\n
The citizenship-by investment programs of the Caribbean are similar to those practiced in other countries, however they have the advantage of providing much faster access to citizenship. But these programs also come with a huge drawback \u2013 their potential for fraud. Concern has been raised by several authorities that these programs could be used by money launderers and other criminals for easy travel.<\/p>\n
For example, in May this year the US Treasury Department warned the banks that Iranian foreign investors were \u201cabusing\u201d St. Kitts\u2019 citizenship-by-investment program for \u201cillicit financial activity\u201d.<\/p>\n
As a result, St. Kitts and Nevis suspended Iranians from its program last year. The prime minister of St. Kitts and Nevis also promised to improve the program\u2019s vetting of applicants.<\/p>\n
Source<\/strong>: online.wsj.com<\/p>\n","protected":false},"excerpt":{"rendered":" In the face of tight lending, several island nations in the Caribbean are financing their resort and villa projects by selling citizenship. The vacation-home market of the Caribbean has seen many upheavals while recovering from the economy\u2019s downturn. In larger markets and those with direct flights to the US, sales volume and prices for existing…<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"footnotes":"","_jetpack_memberships_contains_paid_content":false,"jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[454],"tags":[],"jetpack_publicize_connections":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p8hnWW-Di","jetpack_likes_enabled":true,"_links":{"self":[{"href":"https:\/\/www.investmentimmigration.com\/wp-json\/wp\/v2\/posts\/2436"}],"collection":[{"href":"https:\/\/www.investmentimmigration.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmentimmigration.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmentimmigration.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmentimmigration.com\/wp-json\/wp\/v2\/comments?post=2436"}],"version-history":[{"count":0,"href":"https:\/\/www.investmentimmigration.com\/wp-json\/wp\/v2\/posts\/2436\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmentimmigration.com\/wp-json\/wp\/v2\/media?parent=2436"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmentimmigration.com\/wp-json\/wp\/v2\/categories?post=2436"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmentimmigration.com\/wp-json\/wp\/v2\/tags?post=2436"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}