A Warning from ECCB Governor.
ROSEAU, Dominica, Jan 13, CMC – The Governor of the Eastern Caribbean Central Bank (ECCB), Timothy Antoine is urging Caribbean governments administering Citizenship by Investment Programmes (CIP) to be more transparent and not to use the funds collected for recurrent expenditure..
A number of countries within the Eastern Caribbean Currency Union (ECCU), such as Antigua and Barbuda, Dominica, Grenada, St. Vincent and the Grenadines and St. Lucia, offer CIPs in a bid to lure foreign investors to their countries.
Under the programme, investors receive citizenship of these islands in return for making a substantial investment to the socio-economic development of the countries.
Antoine is telling the governments of these islands that they should be “transparent by publishing all of the flows, the ins and outs of the funds.
“We believe that this is extremely important for people to know how much is collected, how is it spent. So we welcome the efforts of the (Dominica) government to establish in the last budget specifically how much is coming from CIP and what it is being spent on.
“We think that’s important and we also …suggested a template that could be used to publish this information on a regular basis so anybody, here, home or abroad can see this information and understand what is happening in the programme.”
Antoine said that the ECCB is also recommending a number of measures to ensure that the funds received under the programme are properly utilised given the fact that “none of us knows how long the CIP will last.
“We hope it will last for a long time, but we really don’t know. Right now Dominica is doing well…but who knows the future. Many of our countries now have such a programme and so we say be prudent by not using the money for recurrent expenditure.
“Don’t use it to pay wages and salaries, don’t use it to pay light bills, because when you do that if the funds stop you in trouble,” he said, suggesting that the funds be used to pay down on domestic arrears, such as payment to local suppliers for goods and services.
“If you have foreign debt pay them on that,” he said noting that in Dominica’s case, the Roosevelt Skerrit government is using money to “fund a number of things for (Tropical Storm) Erika” that caused millions of dollars in damages in 2015.
“That makes sense because instead of borrowing, the government is using CIP. We also say use it to fund critical infrastructure. Clearly Dominica (in) post Erika there is a need for roads and bridges. We also know the government is going to use some for geothermal development. We believe those are good uses of CIP,” Antoine added.