Caribbean & Central America - February 2016 (ISSN 1741-4458)

It is a year since Team Unity ended the 20-year premiership of Denzil Douglas, leader of the St Kitts & Nevis Labour Party (SKNLP). But Team Unity, under the leadership of SKNLP defector Timothy Harris, is still struggling with some of aspects of Douglas’s legacy, most notably the Citizenship by Investment (CBI) programme.

The good news for the Harris-led government is that the SKN economy is forecast to grow by 4.6% in 2016, after an even stronger 6.6% growth estimated for 2015. At a press conference in late January, the prime minister noted that the strongly performing sectors in early 2016 are construction, tourism, manufacturing, agriculture, and professional and financial services.

Harris also noted that SKN recorded a budget surplus in 2015. But herein lies a difficulty. This gratifying fiscal space is in part due to the continuing contribution of the controversial CBI programme. On 15 December, the prime minister told parliament that revenue from the CBI programme would be more than 40% ahead of budget for 2015, helping to boost the surplus to EC$222.1m (US$82m), 16% above budget. While in opposition, Harris had dismissed the CBI scheme as a “slush fund” for former prime minister Denzil Douglas, and controversies over the running of the programme are continuing to cloud relations with important partner countries such as Canada and the US.

Under the CBI programme, the SKN government issued 10,777 passports between 2005 and 2015. The programme started slowly, with only six passports being issued in the first year and 19 in the second. But by 2011 over a thousand were being issued per year, and by 2013 this had climbed to over 2,000. The figure for 2014 was 2,329, with a further 2,296 being issued in 2015.

This escalation in the CBI programme led the US to issue a warning in May 2014 that the Douglas administration was allowing “illicit actors” to benefit from the purchase of SKN passports. Then, in November 2014, Canada withdrew its concession of visa-free access for holders of SKN passports, citing in particular concerns over those entering Canada on passports issued under the CBI scheme.

As a result of this pressure from Canada and the US, in December 2014 the government had to recall more than 15,000 passports issued between January 2012 and July 2014 as these no longer displayed the place of birth and any changes to names of the holders. According to Harris, the Douglas administration had removed this requirement specifically so that “illicit actors” could conceal their true identities and origins from immigration authorities in Canada and the US. Speaking in parliament in late December, the prime minister said of his predecessor: “All he wanted was money, money for his own sake, and he was prepared…to allow the illicit actors to be able to move about with disguise”.

Having rectified this most glaring of problems with the CBI programme, the government is now engaged in urgent discussions with Canada for the restoration of visa-free travel. Foreign Minister Mark Brantley met with his Canadian counterpart on the side lines of the Commonwealth Heads of Government summit in Malta in November, and further informal talks were held with Canada’s new prime minister Justin Trudeau during his family holiday in Nevis in January. Following these talks, Brantley said: “I can’t make promises, but I feel optimistic that we will overcome this particular hurdle. I think it is important…because it is important for our reputation; it is important for our people to travel freely to as many countries as possible.”

• “The good news for the Harris-led government is that the SKN economy is forecast to grow by 4.6% in 2016, after an even stronger 6.6% growth estimated for 2015. At a press conference in late January, the prime minister noted that the strongly performing sectors in early 2016 are construction, tourism, manufacturing, agriculture, and professional and financial services.”