By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
A Cabinet Minister believes the Bahamas lacks the “social maturity” to accept an Investor Citizen programme that would aim to attract the world’s wealthiest individuals to this nation and supply a major economic boost.
Ryan Pinder, minister of financial services, said the Bahamas’ politically-charged environment, where many persons were swayed by emotions rather than pragmatism, were major obstacles to the initiatives embraced by many other nations.
Addressing the Nassau Conference earlier this week, Mr Pinder also recalled efforts to have the Bahamas sign on to the Caribbean Single Market and Economy (CSME), which “broke down in this jurisdiction” due to the perceived “threat” caused by the free movement of Caribbean nationals.
“The social maturity in some jurisdictions might be challenged by this concept,” Mr Pinder said of an Investor Citizen programme, adding that extending the right to vote to persons who gained citizenship via investing might also create challenges when it came to public acceptance.
And, identifying Bahamian politics as a major obstacle, he asked Nassau Conference attendees who supported a Bahamian Investor Citizen programme whether they would “vote against the politician who supports it” come the general election.
“You have the challenge in small countries like the Bahamas that are very politically charged, with 93 per cent voter turnout,” Mr Pinder said, adding that “even the most equitable constitutional referendums are challenged”.
That was likely a nod to the upcoming constitutional referendum that the Christie administration is overseeing, plus the one that the Ingraham administration attempted in 2002 - an endeavour that was politicised in the run-up to that year’s general election.
“These are the speed bumps, probably more like road blocks, to advancing a credible investor citizenship programme in jurisdictions like the Bahamas,” Mr Pinder said.
In response, Joe Fields, a US attorney with Withersworldwide, effectively admonished Mr Pinder for ‘giving up’ on an Investor Citizen programme in the face of local political difficulties.
He said: “If Scotland had gone independent, it would have guaranteed a Conservative government [in the UK] for 50 years. There’s always going to be political consequences.”
And Reaz Jafri, an attorney with Withers Bergman, had earlier told the Nassau Conference that St Kitts & Nevis had run an ‘Investor Citizen’ programme for 30 years without it being abused.
“It has not become the passport of the drug dealers, the arms dealers and the bad guys,” Mr Jafri said, despite the US Treasury’s warning earlier this year that the St Kitts programme was open to abuse, forcing the Caribbean territory to make modifications to it.
The idea of a Bahamian Investor Citizenship programme was publicly-floated in mid-May by Sean McWeeney QC, a key adviser to Prime Minister Perry Christie, who urged the Bahamas to “join the bandwagon” and implement such an initiative.
While arguing that it would have “the most transformative effect” on the economy, Mr McWeeney emphasised that such an initiative would not be ‘mass marketed’ or see the Bahamas merely selling citizenship to whomever.
He said a Bahamian Investor Citizenship initiative would target the world’s leading high net worth individuals and their families, enticing them to follow their assets to the Bahamas and have this nation as their primary domicile.
The ultimate goal would be to see these individuals follow the Izmirlian family and Joe Lewis, and become major investors in the domestic economy, creating hundreds of jobs for Bahamians. The investment bar would be set high.
The proposal gained a mixed response, with some in the private sector arguing it was essential to sustain the financial services industry, and others arguing that Bahamian citizenship should be ‘earned, not sold’.
The Christie administration is proceeding cautiously in turning this into legislative and policy reality, fearing a potential political and nationalist backlash if it is perceived to be giving Bahamian citizenship away for a price.
Mr Pinder, meanwhile, later took on permanent residency, telling the Nassau Conference there were currently no plans to raise the qualification bar above the existing purchase of a $500,000 home.
“There’s mixed opinions and mixed reviews on whether to raise the value of the home,” he said. “The real estate developers here lobby heavily on that.
“They build condos worth $600,000-$700,000, and see permanent residency as this value added that they want to keep.
“There are conflicting positions with respect to raising the value. However, tor the Government, the position is it will remain at $500,000 for the time being.”
Emphasising that the Government was seeking to make its citizenship and permanent residency programmes more transparent, Mr Pinder said its permanent residency with the right to work in your own business “differentiates the Bahamas.... that sets us apart”.
He added that this was especially suited to the Chinese and Asian market, with its exchange controls on individuals as opposed to businesses, as it would enable a move “from passive residency to active residency”.
Mr Pinder said persons could also obtain annual residency in the Bahamas for up to five years through simply applying, which he described as “a good introduction to permanent residency”.
Focusing on the suggestion that applicants invest in government bonds, Mr Pinder said that while this might not be suitable for permanent residents - given the emphasis historically on capital and real estate investments - it could apply to annual residency.
He used the example of an annual resident who invested $1 million in a non-interest bearing government bond. The Government could then use this money for educational and social purposes for five years, returning the principal at that point, with the investor then able to apply for permanent residency.
Mr Pinder added that the Bahamas also “has a framework for tax residency”, which would enable investors and their assets to fall outside the scope of tax information exchange regimes.
Comments
SP 9 years, 5 months ago
Some of the worlds wealthiest have resided here for decades on Paradise Island, private Islands, throughout the family Islands, Lyford Cay etc. with the drug and arms dealers and bad guys and white collar criminals being already entrenched here a long time ago.
For instance there are considerable numbers of individuals resident in Lyford Cay similar to the Izmirlian family and Joe Lewis, capable of multi-billion dollar developments, but they themselves have no confidence in the government of the Bahamas after witnessing decades of shenanigans, corruption and sheer stupidity.
Mr. Pinder must face facts and realize that the Bahamas government is perceived by many as totally corrupt, untrustworthy and rudderless. With the ongoing ducking of a Freedom Of Information Act adding fuel to corruption allegations be they real or perceived.
Alternatively, many resident billion dollar investment able individuals are also some of the worlds biggest swindlers, detestable, untrustworthy and useless individuals that we do not want as citizens or investors and wish they would renounce residency as well.
This is a two edged sword with a very fine dividing line between who we want and don't want as citizens of the Bahamas.
The qualifying criteria cannot simply be billions of dollars in assets or we will be inundated with the worst of the worst seeking refuge and black money laundering.
Although a positive idea with very good potential, any such initiative will have to be well policed by an "independent investigative investment body" that would be less susceptible to political abuse and corruption............Our two main specialties.
Umkhonto 9 years, 5 months ago
For being born in an independent Bahamas Mr. Pinder surely has an old-view of the world. I submit that the focus for the Bahamas should not be based on attracting wealth but instead on building it with their own hands and might. You build wealth Mr. Pinder by improving education and training and by increasing access to technology and capital. The Stafford Sands model has served us well but for Pete's sake can we please show some sign of intellectual dynamism and evolve it?
GrassRoot 9 years, 5 months ago
I agree with both comments above. Becoming a Bahamian citizen should a privilege that is reserved to persons that love this country and are dedicated to build the country with all their skills and talents, and if needed some of their money. What I see though is that we let people in that have an accounting/checkbook mentality - all that matters to them is what expenses they have to incur in order to save taxes and sometimes these people even park their families and the dog in Lyford Cay or Old Fort or Albany for a few years. Having this said though, most if not all of the crooks that set foot onto the island or are residents on the island (and if you google them, there are more of those than we should have) were "let in", have a residents permit etc. only because of their money, wealth and/or promises - whether empty or not. I have seen good people being denied citizenship and bad people been given citizenship and the difference was simply money and greed on behalf of the decision makers - sometime perceived political affinities of the candidates.
The reality of the economic citizenship is a checkbook mentality, these people will not spend any time here, are not here for the love of the country or the Bahamians. They will tolerate all the shortfalls (BEC, corruption, lack of services and goods, limited lifestyle choices) only because the $$ add up being in the Bahamas. I am a firm believer that a Haitian living in the Bahamas, that is a thankful, hardworking person is a better candidate for Bahamian citizenship than a flight-by-night white collar criminal that defrauded clients. Having said this, there is a group of persons that suit the profile of an economic citizen. There are many countries with wealthy families that are seriously at looking to relocate due to political or economical distress (U.S., Venezuela, Ecuador, Mexico, Russia, Iran, Ukraine, China etc.) and the ability to buy land, run a business or build a factory and proximity to the U.S. are key components that make the Bahamas attractive as one of the options for families to find a new home. The ability for economic citizenship puts the Bahamas on their list of countries to choose from. So discounting the merits of Economic Citizenship would be wrong, however I am afraid that the Government, its members, will not be able to look at this approach from any angle other than just $$ piling up for themselves. (yes and there could be the possibility that an economic citizen may obtain voting rights only after a period of time).
TheMadHatter 9 years, 5 months ago
Mr Pinder - before people will be willing to accept CSME, you need to reduce the Haitian population to below 5%. We have enough "free movement of Caribbean nationals" now.
Wake up.
TheMadHatter
The_Oracle 9 years, 5 months ago
This is all preamble for the terms of the EU-EPA agreement we have signed onto, For the free movement of goods AND Services. They will come here with rights Equal to the rights of Bahamians and the Government will not be able to extort hefty investment requirements or Work permit fees. Non discriminatory clauses including taxes and market access. Think about that. No discrimination geographically or by nationality of signatory nations. Same with the CARIB-CAN trade agreement, which is lumbering ahead more slowly.
banker 9 years, 5 months ago
And it will be a very good thing. The way that a country advances, is to throw open its doors to skilled people from everywhere. These people create jobs, diversify the economy and make creative solutions to pressing problems. For example, what if the government cooperated with private industry to solve the Haitian problem? Suppose that we created work for the illegals in the salt mines at Mayaguana? We would be able to regulate them. They would get what they want ~ a wage to send home, and the population of Mayaguana would grown and that would spur development. Many would remove themselves from Nassau for the work that would be slightly higher paying. All we need is someone with vision, capital and marketing know-how to do this.
DEDDIE 9 years, 5 months ago
The wealth of the western world was build using the same formula banker. We forget that's how Negroes ended up on this side of the world. This side of the world needed labor and that labor was brought here although in a forceful manner it was responsible for revolutionizing the economies of the New World. Even though the negro Bahamian was intimately part of this economic revolution, he is totally fearful of it. The bar council don't want no foreign lawyers practicing here and the average John Doe don't want no foreign negro here either.
The_Oracle 9 years, 5 months ago
Correct Banker in the first part of your comment, however the inevitable marginalization of the majority of Bahamians and the associated increase in Crime will become a disincentive proportional to said influx. A split society will require many high walls and personal security entourages. Looks south to see what that looks like. I do not think the people of Mayaguana would like your suggestion however.
Sign in to comment
Or login with:
OpenID