IMF Credits CBI for Caribbean Economic Growth and Encourages Digital Currency as St Kitts and Nevis Passes Virtual Assets Bill

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LONDON, Feb. 6, 2020 /PRNewswire/ -- Citizenship by Investment (CBI) is one of the main reasons the Eastern Caribbean Currency Union (ECCU) has registered a GDP growth last year, the IMF staff report in their mission concluding statement. Moreover, the IMF staff suggest that "cautiously piloting a digital currency" is one of the areas that could catalyse the region's resources and capacity, which would particularly help "solidify the monetary union by raising payment's efficiency."

St Kitts and Nevis is already building a fintech-friendly legislative and regulatory framework. At the end of January, the St Kitts and Nevis Parliament passed the Virtual Assets Bill, which requires businesses to register, pass due diligence checks and be subjected to a supervisory regime should they wish to participate in virtual asset services. This is aligned with the anti-money laundering standards established by the international policy-maker Financial Action Task Force (FATF).

Premier and Finance Minister Timothy Harris said during the bill's second and final reading in Parliament on January 23rd that the move addresses what the governor of the Eastern Caribbean Central Bank describes as a "cashless society." PM Harris said that "it is vital at this juncture that we embrace the opportunity to expand our capacities for adaptation to the swiftly changing realities of the technological spheres in which we find ourselves in this 21st century."

In December, Prime Minister Harris announced that St Kitts and Nevis would be introducing biometrics to the screening process that all applicants under the Citizenship by Investment Programme must pass before being considered. Once approved, to obtain second citizenship from St Kitts and Nevis, an applicant can contribute US$150,000 to the Sustainable Growth Fund, whereas families of four or more can apply jointly by making a minimum contribution of US$195,000. If successful, investors obtain the right to live and work in St Kitts and Nevis, along with other benefits.

Daniel Kelman, general counsel and cryptocurrency supporter, salutes the twin island nation's move towards more fintech integration. "You can have a business in St Kitts and do business all over the world," says Kelman. He added for a government-issued press release: "to have a small business here on the island and reach out to the whole world as if there was no border – that is exactly the direction [St Kitts and Nevis] should be going."

St Kitts and Nevis saw an improved fiscal performance in 2019, as noted in the preliminary findings of the most recent Economies of Latin America and the Caribbean (ECLAC) report. The authors note a series of positive economic trends in St Kitts and Nevis, namely deflating prices (-0.43%), decreasing debt stock (-3.5%), growing GDP (+3%), fiscal surplus (+191.5 million), growing tourism numbers (+11.9%), several CBI-sponsored infrastructural projects, with positive spillovers in several sectors in terms of job creation and profit margins.

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