[Press release] During my several pronouncements on the economic management of our island by the government of the United Workers Party, I have on several occasions lamented two specific policies of the government.
1. The proposed use of CIP funds
2. The effect of increases in taxes on travel
Recent developments in Europe (Cyprus) to be exact will show that this country has made amendments to its CIP program by capping the number of passports issued to seven hundred per year. The real estate holding requirement period of three years will now start from the time a town planning permit is issued and all future applications ,will be subject to enhanced due diligence ,the cost of which will be borne by the applicants.
The public will recall that the CIP as conceived by the Saint Lucia Labour Party made provision for a five hundred-cap on passports per year ,financial requirements for applicants and specific use of the funds from the sale of our passports.
The UWP oblivious to the advice of the Opposition unilaterally changed the regulations by removing the cap ,the financial requirement of three million US dollars ,and has refused to report to parliament on the use of the Economic Development Fund.
Instead, they have decided to allow the proceeds from the sale of our passports to be loaned to foreigners at a rate of 2% ostensibly for hotel development.
The Opposition has opposed this policy from its inception for two main reasons. It made poor financial sense to gift the proceeds of our passport to foreigners at a rate of two percent but borrow in the financial markets at higher rates Secondly there was little risk to the “investor ” who is the recipient of such a deal.
As usual the opposition was ridiculed and attacked by the government when we suggested that government reconsider these changes.
Earlier this week the government of Grenada was praised for its use of CIP funds.
The Grenada government saves forty percent if the proceeds for disaster preparedness and the remainder for education social and economic development.
The Government of Saint Lucia however prefers to impose a burdensome fuel tax on its people and loan the proceeds of its passport sales to foreigners at an interest rate of two percent.
History will prove that the economic choices of the UWP are not well thought out or deeply analyzed before implementation.
In my next post, I will discuss the tax on air travel as we prepare for another increase in the price of gas and diesel for the people of St Lucia.
Philip J. Pierre