By EB5 Investors Magazine Staff
Images of widespread devastation in the Caribbean from hurricanes Irma and Maria were unsettling and might give pause to someone considering pursuing citizenship by investment there.
Some of the island nations with such programs came through with little or no damage, however. And the islands that were hard hit will need investment more than ever, say those who advise clients about investing in the region. One island nation has even announced a hurricane-related investment program.
Island leaders continue to assessing what shape up to be a particularly active, and destructive, hurricane season. But the hurricanes did not wreak havoc on every island with citizenship-by-investment programs. St. Lucia and Grenada were spared significant damage. Dominica escaped damage from Irma but was slammed by Maria as a Category 5 hurricane, causing devastation and widespread looting, according to the St. Lucia Times. Barbuda was almost completely destroyed by Irma, with all 1,500 residents evacuated, most to the sister island of Antigua, 30 miles away, which had just a glancing blow. St. Kitts and Nevis experienced damage from the storms, but the islands were spared the full brunt.
HURRICANES TRIGGER NEW CBI PROGRAM AND INVESTMENTS
On Sept. 23, the Citizenship by Investment Program in St. Kitts and Nevis announced a Hurricane Relief Fund. Citizenship-by-investment applicants can invest $150,000, part of which will be channeled to repair damage on the island and alleviate suffering. That amount is less than the required contribution to the program’s previous two options: a charity donation of $250,000 toward sugar industry diversification and a real estate investment of $400,000.
The new fund is open to families of up to four people and remains active until March 30. All programs, which require additional fees, include a renewable passport valid for 10 years.
“The Hurricane Relief Fund is an attractive option for citizenship applicants in the way it fulfills their own desire to make a positive impact on the environment … (and) play an active part,” said Prime Minister Timothy Harris on the program’s website.
“It enables the country and its people to recover more quickly and to ensure that the infrastructure and people’s homes are fit and habitable where they have been damaged by this season’s hurricanes. It is hoped that the fund will grow sufficiently to be in a position to extend support to neighboring countries in the Caribbean who have been affected this season’s hurricanes.”
Those who advise clients on citizenship and residency by investment say that rather than derailing investment, the hurricane damage makes it more vital as these affected island nations prepare to rebuild.
“Hurricane Irma, and other tropical storms in the region, make the need for (citizenship-by-investment programs) even more pressing,” said Armand Arton, founder and president of the Arton Group, a global financial advisory firm specializing in investor programs for residence and citizenship. “We have seen in the last five years that they have been the major source of financing going into the region. Without it, there would have been recession and widespread unemployment.”
Arton points to what happened to Dominica when it was hit in August 2015 by Tropical Storm Erika, which dumped 33 inches of rain and caused flash flooding and mudslides. Thousands of homes had to be rebuilt or repaired, and many bridges and roads were wiped out.
“One thing was clear,” he said. “Without the country’s citizenship-by-investment program, the reconstruction would have taken at least twice as long, potentially longer.”
Ronald Sanders, the Antigua and Barbuda ambassador to the United States, told CNN the government intends to rebuild Barbuda. Wealthy individuals had donated about $5 million in the week after the disaster, and countries offered immediate relief. But a few million dollars is a “drop in the bucket,” Sanders said.
“We're a $1 billion economy facing a $250 million problem,” Sanders said. Officials envision holding a donors conference, he said, where international agencies and nations would plan a rebuilding initiative.
Sanders wasn’t able to give a timetable for the rebuilding process but said it depends on how much funding can be raised by the independent country, which doesn’t have a wealthy parent to turn to as most of the other damaged islands do.
Besides real estate, citizenship by investment can be applied to roads, bridges, airports and other infrastructure, Arton pointed out.
“The need for greater investment is there, so it is possible that other islands that do not already have such a program, but are considering one, will decide that the time is right now,” he said.
Henley & Partners, which advises wealthy clients on residence and citizenship planning, said it is seeing significant interest from clients who want to donate relief funds to assist the country.
“Although changes were made to the Antigua and Barbuda Citizenship-by-Investment Program’s processing fees, this was done before the passage of Hurricane Irma,” said Sarah Nicklin, group PR manager in Cape Town, South Africa. More investment opportunities will be available as the rebuilding of Barbuda is being assessed and mechanisms for rebuilding are put in place, she said.
The Antigua and Barbuda Citizenship-by-Investment Program raises much-needed funds for the country, Nicklin said. “Individuals who acquire Antigua and Barbuda citizenship through the program will be supporting the government’s efforts to rebuild Barbuda following the devastation caused by Hurricane Irma.”
Some Caribbean island nations that offer residency-by-investment programs were impacted by the hurricanes. All the islands in the Turks and Caicos Islands suffered damage from Irma – especially South Caicos, Salt Cay and Grand Turk – and were slapped again by Maria. And Anguilla took a big hit from Irma, with infrastructure damaged, tourism shattered and aid from parent Britain slow to arrive.
Most of the islands in the Bahamas, however, escaped severe damage, according to the Caribbean Journal. Officials said tourism facilities in Nassau, Paradise Island, Grand Bahama and the Out Islands were unaffected, with “cosmetic” damage in Crooked Island, Inagua and Mayaguana and major structural damage on Ragged Island.