PRIME Minister Allen Chastanet, Tuesday at a House of Assembly meeting, cleared the air about the US$2.6 billion Desert Star Holdings (DSH) Limited project earmarked for Vieux Fort and its relationship with the Citizenship by Investment Programme (CIP).
Chastanet in response to Ernest Hilaire (Castries South Member of Parliament) who said DSH is a CIP project, interrupted to state that DSH is not under the CIP nor has DSH applied to be under the CIP and neither has it been registered as a CIP project.
The Prime Minister’s response flies in the face of previous media reports, some quoting him implicating DSH as part of the CIP.
For the longest while it has been believed, due to comments made by the Prime Minister over the past years that DSH was either to receive money from CIP or a CIP project.
Surprisingly, Prime Minister Chastanet had at times as well noted that DSH was not a CIP funded project (see the August 10, 2017 edition of the VOICE Newspaper).
Prime Minister Chastanet and his government had, over the years, been alluding to both DSH being and not being a CIP funded project.
In August 2017 the prime minister made it clear that the horse racing track in Vieux Fort, which is Phase 1 of the DSH project, would be funded by the developer and not by funds from the CIP, however he acknowledged that the equine facilities that will accompany the track may attract CIP funding.
Said Chastanet at the time, “For sure, CIP funds will come into play, for the horse racing track is not a business which is going to make money but it will generate economic activity for the destination.”
The CIP and DSH had been linked from the very first time the US$2.6 billion project had been announced in July 2016. Not only did an agreement signed by Chastanet and DSH Chairman, Teo Ah Khing back then pave the way for the multi-billion dollar project, but it was said that commencement of the project’s initial phase was slated for 2017 pending approvals and other logistical matters which needed to be ironed out by the Citizenship by Investment Unit and the Development Control Authority (DCA).
The Prime Minister at the time said that in order to facilitate DSH investors, government would have to amend the Citizenship by Investment Act so that key aspects of the project would be accommodated in the current categories.
Said Chastanet, “The horse racing aspect of the project, which is central to its lifestyle component, needs to be incorporated within the categories of an approved project, not on its own, but within the broader context of an integrated project and not solely based on hotel construction.”
In fact, a statement by the government in August 2016 noted that Khing made a presentation to several organizations including the Citizenship by Investment Unit.
The statement reads in part thus: “…the Framework Agreement has not, and cannot by definition; grant CIP approved status or DCA approval to the project. In fact, DSH is currently pursuing its DCA approval and indeed will be making its application for CIP status once the government has fulfilled its obligation to make necessary changes to the CIP legislation.”
The most telling evidence that placed DSH as a CIP funded project was given by Prime Minister Chastanet at a press conference in February 2018 replying to a question posed by this reporter.
Chastanet said the money spent by DSH on the horse racing track, including the stables and other supporting facilities would be reimbursed to DSH through the Citizenship by Investment Programme.
Said Chastanet at that particular press conference: “We will have a quantity surveyor determine how much money is actually spent on the horse racing track, which to us are also the stables. Those monies will then be reimbursed through the CIP in which they (DSH) are responsible for marketing the CIP. Once the track is paid for, we will then take back ownership of the land and so no longer will there be a lease.”
Although he was emphatic about DSH’s status regarding the CIP, the Prime Minister’s comments at Tuesday’s sitting of parliament have left more questions than answers.
“The Member is misleading the House,” said Prime Minister Chastanet referring to Hilaire, “We have said DSH is not a CIP approved project and has not put in an application to be a CIP project,” was his insistent response to Hilaire’s suggestions that DSH is CIP or may be CIP funded.