Caribbean Currents #001
Passport Sales, Ganja, Labour Shortages ...
Welcome to the latest issue of Caribbean Currents 🌴🌊📊
Dive into Caribbean Currents every week for a snapshot of the economic pulse of the global Caribbean — from Bridgetown to Bluefields, from Paramaribo to the Bronx.
In this issue
Citizenship by Investment in the Caribbean
The Grenadian government noted substantial revenue growth from its Citizenship by Investment Programme (CBI) during the first half of this year. Under this program, foreign investors achieve Grenadian citizenship through either a contribution of no less than US$150,000 to the National Transformation Fund or an investment in an approved real estate project in Grenada. From January to June, the program produced EC$157 million in revenue, a record since its 2014 inception. The projected revenue for 2023 is EC$240,461,920. Impressively, June's CBI revenue exceeded projections by EC$44.4 million.
However, Grenada is not the sole Caribbean nation offering CBI. Other countries include Antigua and Barbuda, Dominica, St. Kitts and Nevis, and St. Lucia. Specifically, St. Kitts and Nevis, often viewed as the CBI pioneer due to its 1984 launch, possesses the Caribbean's fourth strongest passport and demands an initial CBI investment of USD$250,000 the highest for the Caribbean region.
These CBI initiatives significantly bolster the economies of participating nations, channeling revenues into diverse sectors and promoting national growth. For instance, CBI-generated revenues have been pivotal for Dominica, particularly in post-disaster recovery, underlining the program's national resilience-building potential.
However, the CBI's boom to GDP and revenues has also attracted international critique. The program's provision of national passports, granting visa-free access to numerous European countries, has prompted concerns. Some fear the CBI offers a loophole for individuals otherwise barred from Europe, straining relations between the Eastern Caribbean and the European Union (EU). Enhanced due diligence procedures within the CBI program may be needed to prevent potential European visa-free access loss.
Despite the challenges and international scrutiny, the CBI's overall impact remains predominantly beneficial and crucial for national development, resilience, and economic diversification.
Bermuda Launches An Airline
The Premier of Bermuda announced this week that British Overseas Territory will launch its own airline.
BermudAir is set to connect Bermuda's L.F. Wade Airport to Boston Logan and New York's Westchester County, with five weekly flights to both locations. Additionally, service to Fort Lauderdale will commence on Sept. 22. Though BermudAir intends to offer an all-business-class cabin, it will initiate service using its Embraer E175 aircraft without initial retrofitting. Initially, the 88-seat E175 will have only 44 coach seats for passengers. By November, after cabin renovations, the E175s will feature 30 aisle-class seats, which consist of one seat on either side of the central aisle.
The Caribbean has always been plagued with air transport problems - from few routes to costly tickets. Interestingly, the new Bermuda airline's inaugural flights link Bermuda to the USA and not to other parts of the Caribbean.
Bahamas Marijuana Rules
The Bahamas government has introduced bills to legalize marijuana for medical and religious reasons and to decriminalize possession of small quantities, aligning with other Caribbean nations' similar measures. If passed, individuals possessing under 30 grams of marijuana would face a $250 fine without a criminal record notation. However, recreational purchases would remain prohibited. Only fully Bahamian-owned companies would obtain licenses for cultivation, retail, transport, and religious usage. At the same time, those for research, testing, and manufacturing would go to firms with at least 30% Bahamian ownership.
Attorney General Ryan Pinder mentioned that marijuana for religious use could only be consumed within licensed establishments. The government plans to establish a Cannabis Authority to oversee the industry. Public discussions will occur in September, with potential legislative approval by the end of the year. Similarly, Antigua decriminalized marijuana for public consumption, Jamaica allowed small amounts, and the US Virgin Islands approved its recreational and sacramental use.
Labor Market Dynamics in the Caribbean
This week, Jamaica announced a historically low unemployment rate of 4.5%, marking a decrease of 1.5 percentage points compared to the previous year. This reduction was paired with a noticeable surge in female employment. Aubyn Hill, the Minister of Industry, Investment and Commerce, elaborated on initiatives such as the Productive Inputs Relief (PIR). This program bolsters small businesses' export endeavors by allowing duty-free importation of certain productive items. Additionally, Prime Minister Andrew Holness underscored the broader socio-economic ramifications of this milestone, viewing it not merely as a statistic but as a transformative moment for Jamaican families due to increased disposable income and the nation's positive economic path.
In contrast, while Jamaica approaches full employment, Guyana faces an estimated labor deficit of 100,000 workers. To counter this deficit, the Ministry of Foreign Affairs and International Cooperation is finalizing a framework geared towards labor sourcing, skill specialization, and certification. During a Multi-Stakeholders Meeting, the Ministry's Secretary, Robert Persaud, identified the most acute shortages in the construction and oil and gas sectors. Persaud introduced the "mobility labour" concept, proposing a strategic shift of labor from one region to another based on demand and aiming to assimilate the Guyanese diaspora into the domestic workforce. However, precise coordination in matching job specifications and training remains a primary challenge.
Similarly, Barbados has reported labor shortages, especially in construction and tourism. Renee Coppin, the Barbados Hotel and Tourism Association (BHTA) Chairman, stressed the necessity for a strategic blueprint to navigate the labor deficit in the hospitality industry. She echoed Prime Minister Mia Mottley's appeal for a dialogue between the private sector and labor representatives. Coppin emphasized that such discourse is vital to confront industry-wide issues, particularly given the tourism sector's intrinsic dependence on human resources. She focuses on nurturing amicable relationships between staff and their representative unions, ensuring equity throughout the industry. Effective solutions must be grounded in comprehensive planning for the tourism sector and broader national development, reinforced by adequate resources, training, and education.
CPSI Podcasts This Week
Check out the latest episode of Caribbean Progress with Rasheed Griffith; this week's guest is Caribbean Economist Marla Dukharan, who explains the hypocrisy of international tax and anti-money laundering rules. You can also subscribe on Apple Podcast or Spotify.
🌴 Dive Deeper!
Don't miss the next issue of Caribbean Currents 👇