Caribbean Trade Law and Development

Tag: Caribbean

  • Securing better statistical data for better Caribbean lives: Reflecting on the data problem in the Caribbean

    Alicia Nicholls

    Statistical offices and associations across the Caribbean will join those around the world this coming Monday October 20 in celebrating the annual UN World Statistics Day which aims to highlight the importance of statistics in shaping our societies. This year’s theme “Better data, better lives” caused me to reflect on two things which caught my eye in the news in recent weeks. The first was the non-inclusion of Barbados in the World Economic Forum’s Global Competitiveness Report 2015/2016 due to the lack of available data. This point was raised by one of our veteran journalists in an article. The second was the description by the Director of the Caribbean Export Development Agency of the lack of data for the region in order to assess the competitiveness of regional exports as “embarrassing”.They got me thinking yet again on this vexing data problem in the region and the serious development implications of this status quo.

    The Caribbean’s data scarcity problem

    A report coming out of an ECLAC workshop in 2003 succinctly sums up the data problem in the region:

    Generally, the Caribbean countries have been described as “data poor” and in the absence of data and information, policies adopted and implemented have been arrived at on the basis of little or no data and less information. The result is years of wandering in the wilderness of development – talking of visions of the promised land of development without the ability to measure proximity to that goal.

    Years later, the data problem repeats itself. Too many reports mention data shortages in regards to the Caribbean; data is often either missing for some indicators or some years. Barbados’ embarrassing omission from the Global Competitiveness Index ranking in the WEF’s Global Competitiveness Report for 2015/2016 due to the absence of data is just one of the latest examples.

    Obstacles to data availability

    The ECLAC report quoted above notes that obstacles to data availability in the Caribbean region include the following:

    • Lack of financial resources, ‰
    • Lack of qualified personnel, ‰
    • Lack of institutional capacity, ‰
    • Lack of coordination between departments, ‰
    • Low priority on the political agenda

    As a researcher, I can certainly add more than my two-cents’ worth of frustration at the difficulty and in many cases, futility, of trying to obtain data from official and private sector sources here in Barbados and elsewhere in the region in a timely fashion. This is not to cast aspersions on any of these actors. After all, there are occasions where I have gotten good data and assistance from willing staff in government departments/agencies, private sector  associations and from businesses for studies I have had the fortune of working on. But sad to say, there are many occasions where this is the exception and not the rule.

    Central Statistical Offices (CSOs) are financed primarily by government budget resources and in some cases have been receiving declining budget allocations as cash-trapped governments in the region seek to minimise government expenditure. As a result, the human resource and finance constraints of CSOs often limit their capacity to collect data or to process data requests from the public in a timely manner. This often leads to long waiting times for accessing data.

    Outside of initiatives like CARICOMStats, there are few online national or regional statistical databases to draw on. The few which exist are often outdated or limited in the datasets available. The best sources for online data in the region still tend to be international databases. There are good data-rich studies which have been conducted which have been commissioned by public or non-state entities but these findings are often not published or are disseminated only to select stakeholders.

    Data scarce or data scared?

    This brings me to a question I often ask; is it only that we are data scarce or are we also data scared? In the Caribbean there is a possessiveness with which we guard data. There is still the archaic mentality among some public and private actors that power requires cornering knowledge, while data sharing weakens power positions. Due to the silo mentality that pervades many of our civil services, there is often limited data sharing between government agencies and there are instances of more than agency collecting the same data. On the flip side, data collection by government agencies is often constrained by non-cooperation by some members of the private sector and the public in providing data to these agencies in a timely manner. Many businesses in the region do not like to complete surveys and/or are extremely guarded about what data they provide to third parties, with or without a confidentiality agreement.

    Often times, therefore, the only way to obtain data in the region is if one knows a contact in a government agency or has a personal rapport with the business owner from which data is requested. Indeed, what needs to be recognised is that data sharing empowers all. It empowers the data sharer, the data gatherer and the ultimate end users (e.g. the policy makers), as well as the beneficiaries of any policies which the data has been used to support and develop. While there are legitimate data security concerns particularly in regards to sensitive data, this should not be used as an excuse to deny data for legitimate goals.

    So what’s the big deal anyway?

    The data situation in the region is one that has many sustainable development implications. The main end users of data are not just governments, but businesses, NGOs and the citizenry in general. The availability of reliable, accurate and timely statistics is needed for evidence-based planning, evaluating and monitoring of policies and programmes at all levels of government, business and civil society, which ultimately impacts on the society at large. For instance, how can we formulate effective poverty eradication policies if we do not have accurate data on the scale, nature and complexity of the poverty problem? How do we know that the targeted interventions to grow premature sectors of our economies are working if we do not have enough data on which to conduct a proper impact assessment? In many cases, as pointed out in the quote above from the ECLAC workshop report, we are making policies, decisions and formulating plans in the dark. How often have you heard public officials give reports on policies or problems but caveat them by saying “(recent) data is not yet available” or something else to that effect?

    What needs to be done?

    We in the Caribbean region know and acknowledge we have a data problem. What then are the possible solutions?

    • Firstly, we need to strengthen the capacity of our national statistical systems and primarily our CSOs. Our governments must provide CSOs with enough financing and qualified staff so they can effectively and efficiently carry out their functions of collecting, interpreting and providing us the public with timely, accurate and reliable data.
    • Secondly, a frequent complaint is that there are not enough people in the Caribbean region trained in statistical methodologies and technologies. We need not only to continuously train existing CSO staff in these methodologies and technologies but to encourage young people to get into the field of statistics. Statistics is often not seen as a particularly “sexy” or lucrative field like say law or medicine. But this can be changed. Many countries offer national scholarships for development purposes. Why not identify statistics as one of the areas eligible for these scholarships?
    • Thirdly, a big problem in our civil service, and our societies, is the endemic phenomenon of silos; various government agencies collecting the same data or not sharing data with each other. We need an integrated data collection and sharing approach among the various government agencies, coupled with greater linkages with the industry stakeholders. Key to this is more communication about the kinds of data needed, agreed methodologies and standards, and the mechanisms for reporting findings to stakeholders.
    • Fourthly, we must change the fear, skepticism and power attitudes many of our government officials and private sector actors have regarding data sharing through greater statistical advocacy. And while we are still on the topic of changing attitudes, our policy makers need to appreciate the importance of evidence-based (and not gut-based) decisions and evaluations.
    • Fifthly,it would be good to know how many countries have actually amended their statistical legislation to take into account the changes as proposed in the CARICOM Statistics Model Bill.

    This World Statistics Day 2015 themed “Better Data, Better Lives” should be a catalyst for our governments, CSOs, private sector and all our people to reflect critically on the importance of statistical data for creating better lives for us all in the Caribbean region. We know the data problem, the implications of it, and we know the solutions. These proposed solutions herein stated are not novel. They have already been posited by many others.

    Looking at the regional landscape there are several initiatives at the CARICOM level which are quite encouraging and are aimed at tackling the previously mentioned data challenges. Many of these initiatives are being done through technical assistance and capacity building programmes with the help of regional and international development partners. In his speech marking the 7th CARICOM Statistics Day 2015 on October 15,CARICOM Secretary General Irwin LaRocque urged member states to invest in improving their statistical production in order to assist with development. He also outlined the work of the Standing Committee of Caribbean Statisticians which has reportedly recently endorsed an action plan identifying the support needs of the region’s central statistical offices. In his key note address at the Second High Level Advocacy Forum on Statistics, in May 2014, the Hon. Dr. Keith Mitchell, the Prime Minister of Grenada, highlighted not only that statistics should be seen as the voice of the people but also reiterated the importance of a regional approach to statistical development and of ICT in the data revolution.

    The data shortage problem is on the regional agenda. What we need to do is to get serious about implementing these solutions at the national level and a big part of that starts with political will and cooperation from stakeholders.

    Alicia Nicholls, B.Sc., M.Sc., LL.B., is an international trade and development consultant with a keen interest in sustainable development, international law and international relations.

  • Economic Citizenship Programmes in the Eastern Caribbean: A Brief Look

    Alicia Nicholls

    In a world of eroded preferences for traditional Caribbean exports, the small island states of the Eastern Caribbean have had to find non-traditional ways to bolster their small open economies. There is growing global demand for alternative and second citizenship by mobile High Net Worth Individuals (HNWIs), a phenomenon on which an increasing number of states have sought to capitalise. At the Global Citizen Forum 2015 in Monaco last week, Prime Minister of St. Lucia, the Hon. Dr. Kenny Anthony announced his country’s intention to become the latest Caribbean state to offer economic citizenship. St. Lucia will join four other Caribbean countries: St. Kitts & Nevis, Antigua & Barbuda, Dominica and Grenada which operate direct citizenship by investment programmes. This article explores the current programmes in the Eastern Caribbean and whether the offering of economic citizenship is worth the risks involved.

    The concept of citizenship, that is, the status of holding the nationality of a State, is imbued with a whole package of legal, political and other rights and duties. All states of the English speaking Caribbean have citizenship on a jus soli basis, that is, the right to citizenship by virtue of being born in the territory, as well as citizenship through descent and naturalisation. Those states which offer economic citizenship stretch the notion of citizenship to give qualifying investors the right to full legal citizenship and the right to hold a passport for themselves and their families through making a qualifying investment into the local economy.

    Many of these mobile HNWIs are from China, the Middle East and Russia, seeking economic and political security, a more favourable tax climate, and the benefits of hassle free travel a good second passport could bring. According to The Wealth Report 2015, “it is estimated that 76,200 Chinese millionaires emigrated or acquired alternative citizenship over the 10 years to 2013”. Additionally, the US’ system of nationality based taxation and the onerous reporting requirements under FATCA have caused many Americans living abroad to renounce their American citizenship in record numbers (1,335 in the first quarter of 2015 according to this article).

    Economic citizenship and residency programmes are not unique to the Caribbean. Several countries such as Malta and Cyprus operate direct Citizenship by Investment programmes. Some countries offer Immigrant Investor Programmes which use the prospect of citizenship or permanent residence to attract highly skilled HNWIs. The US’ EB-5 visa is a prime example. Similar programmes are also offered by the United Kingdom, Australia and New Zealand. Outside of this, there is a whole wealth and tax planning industry which has built up around advising HNW clients and their families on how and where they can get the best passport for their buck.

    As countries known for their high standards of living, democratic principles, political stability, respect for the rule of law and healthy reputations internationally, it is little wonder several Eastern Caribbean countries have sought to leverage these pull factors and seek to get their share out of the second passport pie. The expected benefits to the host economy include foreign direct investment through purchasing real estate, funding for infrastructure development and the other economic benefits to be derived from HNWIs and their families spending in the economy.

    The investor must meet the application requirements and go through stringent application procedures and invest in one of the options available which differs by country. In return, investors which take advantage of economic citizenship offered by one of those Eastern Caribbean states gets visa free travel to over 100 countries, a second passport, no requirement for residency, as well as second citizenship for themselves and their spouse and dependents. They also can take advantage of the tax benefits offered by a low tax jurisdiction, including no capital gains, wealth or inheritance taxes.

    Below is a brief description of each programme:

    St Kitts & Nevis – It is the oldest continuously operating citizenship by investment programme and has been in existence since 1984. Two options for investment: (1) making a non-refundable donation to the Sugar Industry Diversification Programme of a minimum of US$250,000 plus processing fees or (2) by investing in an approved real estate project worth at least US$400,000 plus registration and other costs.  While the investment in real estate is recoverable, the investor must hold the property for a minimum of 5 years. The next buyer also qualifies for citizenship. For further info: http://stkitts-citizenship.com/

    Antigua & Barbuda – Three methods of investment: (1) Investment of at least US$400,000 in  an approved real estate project to be held for a period of no less than five years, (2) contribution of at least US$200,000 in the National Development Fund, (3) An investment of a minimum of US$1,500,000 directly into an eligible business as a sole investor or a joint investment involving at least 2 persons in an eligible business totalling at least US$5,000,000 and each of those persons individually invests at least US$400,000. For further info: http://cip.gov.ag/citizenship/

    Dominica – Dominica’s programme requires the smallest minimum investment. Citizenship can be obtained through investment either in the Government Fund or the Real Estate Option. According to the website of the CBIU, the generated funds are utilised for public and private sector projects where a need is identified. To qualify for citizenship under the Government fund there are four investment categories with different contribution amounts, based on the number of dependents included in the application. For a single applicant, there is a non-refundable contribution of US$100,000 required. The contribution required increases where a spouse and dependents are involved. To qualify for citizenship of Dominica under the Real Estate Option under the Citizenship by Investment Program, an applicant must purchase authorized real estate to the minimum value of US$200,000 plus government fees which dependent on whether a spouse is included and number of dependents. For further info: http://cbiu.gov.dm/

    Grenada – After a thirteen year hiatus, Grenada restarted its Citizenship by Investment programme in 2014. Application is by invitation only. Citizenship can be obtained by investment of a minimum of US$ 350,000 in an Approved Real Estate project plus fees and costs. The investment is subject to a minimum holding period of four (4) years. The second option is a non-refundable donation to the Island Transformation Fund which is not yet open. For further info: http://www.citizenship.gd/ 

    St Lucia – St Lucia has indicated its programme will begin from January 2016 and details about the programme are not yet available.  It has stated that they expect significant economic benefits from the programme.

    There is little data publicly available on the success of Caribbean CbI programmes. It would be interesting to know the number of applications received and approved on a yearly basis, the countries from which most applicants have come, and what have been the tangible benefits to the host countries. However, the IMF Staff Report  on St Kitts & Nevis noted the citizenship by investment programme in St. Kitts & Nevis, the region’s most successful CbI programme, is bearing fruit. It notes as follows:

    Continued rapid inflows under the Citizenship-By Investment (CBI) program have led to a surge in construction activity, and supported a large increase in government and Sugar Industry Diversification Fund (SIDF) investments and spending, including on the People Employment Program (PEP). These factors, together with the ongoing recovery in tourist arrivals fueled rapid GDP growth of about 6 percent in 2013 and 2014.

    Entangled in the notion of economic citizenship are a whole set of moral and legal issues. For one, the definition of ‘spouse’ in the legislation of these Caribbean countries still means either of a man or woman who are married to each other. In light of competition from other CbI programmes, will this definition eventually be amended to allow gay HNWIs and their spouses to take advantage of these programmes?

    There are also regulatory and national security implications, including concerns about the potential use of second passports to facilitate money laundering, organised crime and terrorist activity. Of course, there are stringent screening methods, including requirements of police certificates of character. After all, all countries prefer to attract investors of good character who are self-sufficient, and willing to make a significant economic investment to the country in which they are seeking citizenship. Under the Antigua & Barbuda programme for example, a person can be deprived of citizenship in several instances e.g: fraud, conviction or failure to spend at least 35 days in Antigua & Barbuda during the period of five calendar years after his registration. There is the potential for attracting ‘undesirables’, even with a rigorous programme.

    A few countries worldwide have found that the potential investment inflows were not worth the risk or they could not cope with the volume of applications. Canada cancelled its Immigrant by Investor Programme, while Hong Kong has suspended its CIES programme. Barbados has clearly stated that for policy reasons it will not go the route of economic citizenship. It currently offers the Special Entry and Reside Programme (SERP) for qualifying HNWIs and their spouses/dependants. In order to qualify as an HNWI in Barbados, the investor must have assets of at less than US$ 5 million. In spite of this, Eastern Caribbean CbI programmes not only have to compete amongst themselves but also face increased competition globally from potentially more attractive CbI and residency programmes worldwide.

    Moreover, countries which offer economic citizenship programmes do open themselves to reputational risks, especially if other States have doubts about the rigor of their screening procedures. The US Treasury has accused persons obtaining St Kitts & Nevis passports for financial crime  and Canada imposed visa requirements on St. Kitts & Nevis nationals on November 22, 2014. The merits of these actions are debatable. However, these are the kinds of risks which countries operating these programmes face. Moreover, they may result in holders of those passports, including natural born citizens, being blacklisted or subject to more scrutiny by foreign jurisdictions, which may redound to more harm than good for that State and undermine the very programme itself.

    In light of the foregoing, any Caribbean state considering a Citizenship by Investment programme must not only consider the possible investment inflows but weigh them carefully against the potential reputational, security and other risks, as well as the sustainability of such a programme.

    Disclaimer: This article is NOT intended to provide investment advice and the Author is not accountable to anyone who relies on the information in this article. The information was taken from sources deemed to be accurate and correct at the time of publication. For further information on the respective CbI programmes stated above, please contact the relevant authorities in the respective countries.

    Alicia Nicholls, B.Sc., M.Sc., LL.B., is an international trade and development consultant with a keen interest in sustainable development, public international law and trade.

  • What CARICOM needs: A little less conversation, a little more action please!

    Alicia Nicholls

    This catchy line from Elvis Presley’s song from the late 60s “A little less conversation” immediately came to mind as I read the flurry of news reports, commentary and analyses swirling around in the regional media for the past two weeks about the current state of crisis of CARICOM. The opinions expressed therein ranged from concern over CARICOM’s ailing health to fears that it had flat-lined. All acknowledge that our main regional body is in deep trouble.

    The backdrop to this latest death scare was yet another report highlighting the weaknesses of CARICOM and the urgent need for reform. This independent consultants’ report, commissioned by the CARICOM Secretariat back in July 2010 and thankfully made available online recently, predicted that, ceteris paribus, CARICOM could be in the mortuary by 2017. It comes on the heels of a frank letter sent by Prime Minister Dr. Ralph Gonsalves of St Vincent and the Grenadines to CARICOM Secretary General, Irwin LaRocque, and copied to the other Heads of Government, expressing grave concern about the current state of CARICOM.

    This hurricane of bad news has quickly elicited a tsunami of denials and pledges of commitment to CARICOM from our leaders across the region. For example, our Prime Minister here in Barbados while acknowledging the challenges facing the region and the regional integration process, vehemently denied that any funeral for CARICOM needed to be planned any time soon. The response from regional leaders, though predictable, is encouraging, given that for the past few years many keen onlookers have been left to wonder about whether our leaders’ commitment to the regional process goes beyond mere lip service.

    Truth be told, it has long been common knowledge that CARICOM has stagnated and faces serious challenges to its survival. The problems identified by the CARICOM Secretariat report and by Prime Minister Gonsalves in his letter are not new. Yet, despite a plethora of studies and recommendations on the same, successive CARICOM heads of government have been unable or unwilling to rectify them. One of the main problems has always been CARICOM’s weak governance structure which per the Revised Treaty of Chaguaramas concentrates policy-making authority in the hands of the Conference of Heads of Government made up of the heads of government of the fifteen member countries. On the contrary, the Secretariat, set up as the body’s principal administrative organ and headed by the Secretary-General, has become overburdened with too many tasks, while having virtually no executive power. Moreover, the lack of a supranational structure means that there is a long interlude between when decisions are taken by the Heads of Government and their implementation, if they are ever implemented, at the national level. For this reason, many of the decisions taken by the Heads of Government remain for far too long at the paper and ink stage. It is this ‘implementation deficit’ which has been continually blamed for the slow process of integration and had been called the ‘Achilles heel of CARICOM’ by the West Indian Commission “Time for Action” Report published some two decades ago.

    The real underlying problem of course is the lack of political will on the part of our leaders to “cede” any national autonomy to a regional body. This is despite the recommendation made in countless CARICOM-commissioned studies that what CARICOM needs is a stronger regional governance framework which would facilitate and expedite the policy implementation process. The jealous guarding of national autonomy on the part of our governments is also evidenced by some countries’ lukewarm support for key regional institutions. As yet only three countries (Barbados, Guyana and Belize) have signed on to the Caribbean Court of Justice’s appellate jurisdiction, although the recently elected Prime Minister of Jamaica, the Hon Portia Simpson-Miller has indicated her country’s willingness to join. However, the other countries in the region remain hesitant about switching to a Caribbean-based court, while they paradoxically cling fiercely to a vestige of colonialism, the Judicial Committee of the Privy Council. The current economic and financial crisis has also increasingly caused our leaders to direct their attention inward towards national concerns, leaving many of the region’s key institutions of functional cooperation to become little more than ‘talk shops’ due to less and less funding from regional governments.

    The truth is that we as a region need CARICOM now more than ever.  Besides our increasing geopolitical irrelevance and our economic marginalisation owing to our small size and loss of trade preferences, the international community is no longer as sympathetic to the economic and political vulnerabilities of non-LDC small states. CARICOM is our shield to an increasingly hostile international climate for small states.  Divided, our individual voices are little more than squeaks on the international stage. But together, our combined voice is less weak. Among other things, CARICOM gives us increased bargaining power in both multilateral and bilateral fora and negotiations and a wider market for regional goods, services and capital. Moreover, through functional cooperation, pooling our limited resources and our collective genius, we can and have achieved objectives which we would have been ill-equipped or completely unable to achieve as individual countries.

    Is this latest report the wake-up call we need as a region? After all, the cynical among us would note that there have been endless studies, reports and other publications before sounding the alarm over the standstill in regional integration and bemoaning the lack of commitment of our governments. Despite this history of ‘a lot of conversation and little action’, I, perhaps naively, choose to be optimistic that this time we, the citzens of our region, will not be treated to more of the same old promises by our leaders.

    The CARICOM Secretariat report was circulated to the Heads of Government before the 23rd Inter-Sessional Meeting on March 8-9, of the Heads of Government in Suriname. According to the communiqué released at the end of the meeting, the Heads of Government considered in-depth the report’s recommendations. Under the area of CARICOM-reform,  they agreed that the Secretary General would begin the process of restructuring the currently overburdened Secretariat with the help of a change facilitator. They also agreed that the Bureau of the Conference would work with an internal group from the Secretariat to facilitate improving regional governance and implementation. Although many of us expected to see more urgent action, it should be recognised that the current financial and economic situation of many of our countries does limit how much resources can be earmarked by our cash-strapped countries to comprehensive CARICOM-reform at this time. However, these two proposed reforms represent a step hopefully in the right direction and it is hoped that at their next meeting our leaders would, following consultations with civil society, have a more concrete plan of action for reform.

    What we need is a little less conversation and more action by our leaders. From a structural point of view, the Revised Treaty of Chaguaramas needs amending to provide a governance structure which would permit CARICOM to function effectively and efficiently and do the tasks for which it was established. It should also provide for and mandate greater participation by the wider society in the regional governance process. Further, it is my hope that among the areas for action would be increased regional funding and political support for regional institutions of functional cooperation. In this vein, all CARICOM countries should accept the CCJ as their final court of appeal and not just because it is a regional court. The CCJ has produced very enlightened jurisprudence so far in both its original and appellate jurisdictions and demonstrates that we as a people should have faith in the wisdom, capability and impartiality of our  judges. With regard to the CARICOM Single Market & Economy (CSME) which Caribbean leaders inexplicably placed on ‘pause’ at their retreat in Guyana last year, a greater commitment is needed by regional governments to remove unduly restrictive barriers to trade between our countries and foster a more vibrant regional market where people, goods, services and capital flow more easily. Part of this would require more concrete steps to deal with the prohibitively high cost of regional transportation.  However, all the hard work cannot be left to our leaders. If there is one thing that I have come to appreciate as a student in the beautifully diverse Faculty of Law at the Cave Hill campus of the University of the West Indies, is that we as a people in the region have to put our false nationalism and stereotypes of each other aside, and recognize that as diverse as we are, we are still one Caribbean people.

    Alicia Nicholls is a trade policy specialist and law student at the University of the West Indies – Cave Hill. You can contact her here or follow her on Twitter at @LicyLaw. 

  • IDB Cultural Center Grants 2012: Call for Proposals

    I just saw this in my Twitter feed and thought I’d share it. If you are interested in learning more, visit http://events.iadb.org/calendar/eventDetail.aspx?lang=en&id=3286. Good luck! 🙂

    IDB Cultural Center Grants 2012: Call for Proposals

    The Cultural Center of the Inter-American Development Bank (IDB) has launched a call for proposals from arts and cultural institutions to fund small-scale cultural development projects in Latin America and the Caribbean through its grant program.

    Applications must be submitted before January 31, 2012 to the IDB offices in the 26 countries in Latin America and the Caribbean. For information on the call for proposals, visit “2012 IDB Cultural Development Grant Program”.

    The Cultural Development Grant Program was created in 1994 to promote development of projects that promote local knowledge and traditions, revive cultural heritage and values, support artistic excellence, and contribute toward community development through economic and social activities in innovative and sustainable ways.

    The projects are evaluated for their viability, educational scope, effective use of resources, ability to mobilize additional financial resources and the long-term impact on the community.

    The IDB may approve from $3,000 to $7,000 per project. Local organizations are responsible for providing the remainder of the resources and supporting the project on a sustainable basis.