The previous article showed the highest GDP per capita in the Caribbean. Within these were Cayman Islands, British Virgin Islands and Puerto Rico, St. Kitts and Nevis, Trinidad and Tobago, and Saint Vincent and the Grenadines. The list diagrams safe and sound investments and phenomenal opportunities for wealth preservation.
On the other side of the spectrum, the following are the lower GDP per capita(poorest) islands in the Caribbean.
Note that we don’t include Cuba here as there is minimal data available. Also, this is not a list of all the islands. I focus on those where we offer formations, citizenship, or some other service.
The lowest GDPs per capita in the Caribbean:
7. Saint Lucia GDP:$1.38 billion, $10,278.00 per capita
St. Lucia maintains well developed legal and commercial infrastructures and the private sector is working hard to bring in new entrepreneurs. Characterized by transparent and efficient business practices, the island is able to appeal to foreign business and investment. Main industries are offshore banking, second passports, and tourism.
Positioned in a vulnerable region to natural disasters, St. Lucia has a volatile tourist economy. To leverage the economy the government shifted interest towards developing computer driven technology and financial services.
Incentives for wealth preservation
- Foreign Tax Credits
- Fiscal incentives Act (100% exemption on income on manufacturing sectors)
- Tourism incentives Act
- Employment incentives
- International Business Companies Act IBC( 1% income tax election)
St. Lucia offers the best second passport by investment program in the Caribbean. Basically invest $500,000 to $550,000 for 5 years in government bonds, and pay $50,000 in fees, and you’ll have a second passport in a few months. For more on this program, see: Changes to the St. Lucia Second Passport Program in 2017
8. Dominica GDP: $0.53 billion, $10,174.00 per capita
Dominica, the nature island, is economically dependent on agriculture (primarily bananas) and tourism. Developing as an ecotourism destination, it also has a offshore medical education sector diversifying the economy. The government is working to foster the offshore financial industry and develop private sectors using geothermal energy resources.
Dominica is the most active island in terms of issuing offshore bank licenses. You can setup an offshore bank on the island with capital of $1 million. Usual setup costs are about $120,000. For more information, see: How to get an Offshore Bank License in Dominica
Since 2003, Dominica has been restructuring the economy by eliminating price controls, privatizing the state banana company, and tax increases. The economy was severely depleted in 2009-20013 from a global recession and is now growing slowly.
Incentives for wealth preservation
- The Fiscal Incentives Act (grants tax holiday for 15 yrs)
- The Hotel Aid Act (hotel and resorts development tax holiday for 20 yrs)
- Registry of the International Business Companies ( tax exemption for 20yrs, repatriation of profits, withholding tax exemptions)
The best second passport for purchase program is Dominica. You can buy a passport for about $120,000 from Dominica and have it within 90 days. You don’t even need to travel to the island to apply… everything can be done online and by courier. For more, see: A second passport from Dominica is the best value in the Caribbean.
9. Grenada GDP: $1.02 billion, $8,500 per capita
Known as the spice island, the economy of Granada is primarily based on nutmeg, mace, cocoa, and tourism. Fluctuations in gross domestic products are tied to the devastating hurricanes that have hit the island, resulting in a destabilized economy. Tourism has become a sustenance for the island, after the construction of the of the international airport in 1985.
As part of both CARICOM and ECCU Eastern Caribbean Currency Union, the island has access to trade with other CARICOM members, US, UK, Germany and Netherlands. Although these trade routes exist, Grenada still has not been able to fully restructure its economy, facing the burden of debt and rebuilding process. Public debt-to- GDP is nearly 110%.
Grenada also recognized dual citizenship, similar to the statutes in antigua with no physical residency requirements, with access to 124 countries.
No tax on worldwide income. Invest a minimum of $350,000.00.
10. Belize GDP: $1.74 billion, $7,831 per capita
This island’s miniscule economy sustained by tourism and exports sugar, banana, citrus, marine products and crude oil. Belize’s GDP has steadily declined from 4% to 0% in the last few years. Oil discoveries in 2006 injected the economic growth but since then production has decreased and oil revenue remain uncertain and are set aside by Belize’s growing imports of refined oil.
High unemployment, heavy foreign debt burden are major concerns in this economy. Import partners are US, Mexico, Cuba, Guatemala, China, Trinidad and Tobago, and export partners are UK, US, Nigeria, Trinidad and Tobago, Ireland and Jamaica.
- Fiscal Incentive program- grants full customs duty exemption for 10-5 years
- Export Processing Zone- grant’s full import and export duty exemptions and dividends. Tax holiday for 20 years with option to extend deduct losses.
- Commercial free zone
- Gaming control (casino) program
- Qualified retired persons program
- Diaspora retiree incentive
Back in the day, Belize looked like it would become a major offshore banking center. After licensing 5 international banks, the island hasn’t issued any more licenses and is not active in the industry.
After some issues in 2015, the offshore banks in Belize have made a comeback. While no new licenses are being issued, those currently operating are doing well.
11. Dominican Republic GDP: $71.46 billion (2016), $6,909.00 per capita
Dominican Republic has been independently governed from Spain since 1863 with the ninth largest economy in Latin America. Strong economic growth of 7.3% in 2014 plus solid remittance payments and trading relationships contribute to economy. These services are the 3rd largest source of foreign exchange.
DR is the second largest producer and exporter of sugar. The islands also exports cigars, refined petroleum and bananas. The primary trading partners for Dominican Republic are the US, China and Haiti.
The Dominican republic, as most islands, in the Caribbean has structural weakness in its government that curtails economic freedom. Laws seem like suggestions by the judicial system, specifically because of the growing corruption that undermines the government’s integrity and effectiveness.
Incentives for wealth preservation
- Tourism incentives (Law 158-01)
- Alternative energy incentives (Law 57-07 )
- Industrial renovation and modernisation incentives(Law 392-07)
- Industrial FTZ operations (Law 8-90 promote employment, production, and economic growth)
- Border development incentives (Law No. 28-01 special development frontier zone)
- Foreign tax credits
12. Jamaica – GDP: $14.6 billion (2016), $4,796.00 per capita
Jamaica has been independent from the UK since 1962. The Jamaica Stock Exchange (JSE) was considered world’s best performing small market stock market in 2015, rising 97% on the market index in the last 5 years. In the Standard and Poor’s 500 index Jamaica reported negative in 2015. The island owns the world’s fifth Largest bauxite reserves. With a population of 2.8 million, Jamaica exports include alcoholic beverages, cassava, raw sugar, and raw coffee beans. Also, is a member of CARICOM. Jamaica has obtained 1.4% GDP increase in the last few years.
The government has achieved taking one step forward and two steps back with tax agendas. Adopting the tax reform programs for business to increasing import tax, property tax, and education tax rates. Corruption and crime runs high, displacing tenacity for businesses and individuals alike.
Opportunities for wealth preservation
- The Special Economic Zones (SEZ) Act.
- The Urban Renewal (Tax Relief) Act.
- The Income Tax Act (Junior Stock Market Companies).
- The Income Tax Relief (Large-Scale Projects & Pioneer Industries) Act.
- The Bauxite and Alumina Industries (Encouragement) Act.
- The Charitable Organizations (Tax Harmonization) (Miscellaneous Provisions) Act.
13. Haiti GDP: $8.02 billion, $729.30 per capita
Haiti, independent from France since 1804, is the second second oldest independent nation in the western hemisphere after the US. It has the lowest GDP per capita in the Caribbean with a 77% poverty rate (remember that we don’t consider Cuba here).
Historically, Haiti is characterized by devastating natural disasters, and has been ruined by 2 centuries of dictators. Governed by corruption, drug trafficking, and general deficit in economic developments.
There is a huge gap between Creole speaking (black majority) and French speaking (mulattoes). Mulattos control most of the wealth. Haiti exports coffee, oils, cocoa, and produce mangoes sugar cane, rice and wood.
Facts for investors
- No US tax treaties, but income taxed in Haiti can be claimed against US income, as foreign tax credits.
- Investment orientated towards export and re-export- exemption from customs duty and income taxes, audit charges, also general exemption from bonds
- Investments in agriculture
- Investment in National industry
- Foreign Trade Zone
In conclusion, if you are considering investing, setting up a business, or buying a second passport, these economies in the Caribbean not only offer opportunities for preserving wealth, but also significant growth potential. The Caribbean is a scrapyard of wonders and opportunities, even the poorest islands are trying to restructure and reinvent ways to attract foreign incomes.
As you avidly have taken the time search information on the Capital of the Caribbean below is checklist to consider while going offshore your business:
- Sufficient capital to become an investor in that island
- The tax implications
- The estate and inheritance tax implications
- The citizenship or immigration options available
- Working with local experts, experienced team of advisors, language barriers
- Currency used, economic and political endeavours of the country
- Access for getting to your preferred Caribbean island and property management
For more information on investing, doing business, or moving to any of these islands, please contact me at email@example.com or call us at (619) 550-2743. All consultations are free and confidential.