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| Dominica:
Encouraging Investment, But Not at Any Price |
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| Dominica’s
towering central mountain range, expanses of forest, waterfalls and offshore
reefs have together earned it the name “Nature Island of the Caribbean.” |
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| Dominica markets
its natural beauty to full advantage, attracting eco-tourists to this unspoiled
destination. Like many Caribbean countries, the Nature Island is
looking at ways to diversify its economy. It is developing a niche
in eco-tourism and, like many of its neighbours, Dominica has seen the
advantages of establishing an offshore financial centre. Dominica is watching
and learning from the example of other financial services industries in
the region. |
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| The re-engineered
Economic Citizenship Program, established relatively recently in 1996,
is an interesting example of how Dominica is welcoming quality investors
to its paradise while attempting to keep out the snake of international
crime. |
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| A
careful approach |
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| Ms. Lucilla
Lewis of Dominica’s International Business Unit (IBU) reports that by December
1998, 173 investors had successfully applied for economic citizenship in
Dominica through the Program and a total of 341 passports have been issued,
showing the popularity of Dominica’s special fee structure for families;
a one-time payment to the Government of US$50,000 qualifies the investor,
his or her spouse and their two children (under 18 years old) for economic
citizenship. Another option is purchasing US$75,000 in 15-year bonds
and paying additional application fees. |
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| Mr. Lennox
Lawrence of Caribbean Investments Ltd. in Dominica is not surprised
by the Program’s success. In his opinion, the Program is one of the
best in the region. |
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| He points
immediately to three advantages that set it apart: the low cost to the
investor, the absence of any residency requirement, and the family fee
structure. |
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| One might
think that the family fee structure is simply a perk, a “buy-one-get-three-free”
offer. This is not at all how Mr. Lawrence or his clients see it,
however. |
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| Mr. Lawrence
meets a diverse group of applicants who are, of course, interested in the
fiscal benefits Dominica offers, but are often simply looking for a new
experience. Fed up with government policy in their home countries,
or interested in different investment possibilities, Dominica’s new economic
citizens can get a fresh start. Obtaining citizenship in Dominica
is part of a lifestyle change, and family is usually a priority when
contemplating such a change. |
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| Interestingly,
Mr. Lawrence noted that perhaps half of the applicants he deals with are
North American. |
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| With their
families, economic citizens who choose to migrate bring to Dominica their
professional experience and their resources; personal, as well as financial.
In addition to an international screening of the applicants for criminal
records (Dominica’s IBU notes that the existence of a criminal record is
the most common reason for rejecting an application), each applicant must
provide evidence of a successful business background or technical expertise.
This is not a rigid criterion - a professor or a banker could both have
the requisite background - rather, it is an attempt to ensure the quality
of accepted applicants. An applicant who has been successful in business
or academia will likely continue to make a positive contribution to the
community in Dominica. |
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| Seeking
improvement |
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| The Program
is under continuous review by the Government of Dominica. Mr. Lawrence
commented that one possible change might be the introduction of a quota
system, restricting the number of new economic citizens admitted in a particular
year. The guiding concern of any review would appear to be ensuring that
the quality of new citizens remains high, that they contribute to and do
not harm the community. |
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| Mr. Lawrence
mused that a residency requirement might be an additional safeguard for
the Island. This would allow a longer time period in which to investigate
the applicant before granting a less easily revocable citizenship. |
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| The Dominica
IBU is also looking at ways to improve the program. One change
currently being contemplated would be the imposition of a registration
fee on agents. |
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| Currently,
the application procedure for agents is relatively simple and straight-forward.
Prospective agents submit an application form with supporting documentation
and a personal data form. They must also undergo an international
check for criminal records. The Government also attempts to ensure
that prospective agents possess the required skills and are able to assist
applicants under the Program. |
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| Understandably,
being able to offer agency services to clients interested in economic citizenship
is popular. It is thought that a registration fee might help to emphasise,
as Ms. Lewis of the IBU puts it, that the government will not accept “just
anyone” as an agent. |
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| Not a back
door route |
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| For the most
part, new economic citizens of Dominica enjoy the same privileges as natural
citizens. They must be residents for five years before they are allowed
to vote, however, and there are certain restrictions on their right to
purchase property above a specified minimum amount. |
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| One definite
advantage of citizenship for some applicants is the possibility of visa-free
travel to all of the Commonwealth countries. The issue of visa-free
travel seems to go to the heart of what one could call Dominica’s “economic
citizenship philosophy”: new citizens are welcomed, and their contributions
to the country are valued and encouraged, but this is not a refuge for
criminals. On the topic of the U.S. visa requirement, Mr. Lawrence
said firmly that “this product is not designed to circumvent U.S. rules”.
If someone was not allowed into the U.S. because of their citizenship and
has now established a meaningful connection to Dominica, Mr. Lawrence foresees
no problem in obtaining a visa. If they have not established such
a connection, however, Mr. Lawrence quite understands the refusal;
“Dominica is not a back door”, he points out. |
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| Conclusion |
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| Dominica has
already embraced the philosophy of sustainable development as its promotion
of “eco-tourism” demonstrates. Economic growth at any cost is not
worthwhile and investment without considering its long-term consequences
can do more harm than good. Dominica’s Economic Citizenship Program
is seen by the Government as one aspect of a long-term strategy for economic
growth. The Program is being watched carefully and will be under
constant review if necessary to keep out an undesirable criminal element.
It seems that the gates to this paradise can be opened, but they remain
well-guarded |
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