Citizenship by Investment: The Caribbean Confronts Europe’s Ultimatum

I first truly grasped what financial dependence means for a small state when I worked in Haiti for the Inter-American Development Bank following the 2010 earthquake. In a devastated country, the urgency of local needs was not always enough to determine priorities. Each source of international financing came with its own procedures, timelines, indicators and, often, its own vision of development. That experience taught me one essential lesson: political independence remains fragile when a state does not have financial resources it can mobilise according to its own choices. It is in light of this reality that we must examine the ultimatum issued by the European Union to the five Eastern Caribbean countries operating Citizenship by Investment programmes, commonly known as CBI: Antigua and Barbuda, Dominica, Grenada, Saint Kitts and Nevis, and Saint Lucia. According to notifications received in June 2026, the European Union has asked these states to terminate their programmes by 1 June 2028 or risk their nationals losing visa-free access to the Schengen Area.

Since December 2025, the European visa-suspension mechanism has allowed measures to be taken against a country that grants its citizenship, in exchange for a predetermined payment or investment, to individuals who have no “genuine link” to that country. The European Union specifically cites the risks of money laundering, corruption, sanctions evasion and inadequate vetting. It does not formally claim the power to prevent Caribbean states from determining the conditions governing access to their nationality. It nevertheless confronts them with a particularly restrictive choice: abandon CBI or expose their entire populations to visa requirements.

An instrument of financial sovereignty

Reducing CBI to the mere “sale of passports” prevents us from understanding its economic function. Small island states have narrow domestic markets, limited tax bases, high import costs and extreme exposure to hurricanes, economic crises and climate change. Their per-capita income sometimes excludes them from concessional financing, even though this indicator does not adequately reflect their structural vulnerability.

CBI revenue has helped finance infrastructure, housing, social programmes, post-disaster reconstruction and strategic investment. In Dominica, during the 2020 and 2021 fiscal years, it accounted, on average, for more than one-third of government revenue. In Antigua and Barbuda, it still represented 9.4 per cent of total government revenue in 2024. Across the five relevant economies of the Eastern Caribbean Currency Union, CBI revenue averaged 6.5 per cent of GDP between 2019 and 2023 and reached nearly one-third of total non-grant government revenue in 2023. The IMF therefore recognises its importance in financing public investment, while also highlighting its volatility, the risks of excessive dependence and the need for greater transparency and stronger fiscal management. (IMF, January 2025; IMF, April 2025, Antigua and Barbuda; IMF, April 2025, ECCU).

Above all, CBI provides resources that are not allocated in advance according to the priorities of an external donor. This freedom of decision-making constitutes a form of fiscal sovereignty. The abrupt termination of these programmes could make the countries concerned more dependent on international loans, development assistance and conditions determined elsewhere.

Transparency as a condition of sovereignty

Defending CBI does not mean overlooking its abuses or treating every international criticism as an attack on sovereignty. Citizens must be able to know how much the state actually receives, what commissions are paid to intermediaries, which projects are financed and what outcomes are achieved. Revenue must be traceable through the national budget, subject to parliamentary and independent audit oversight, and documented in regular public reports.

The same requirement must apply to the selection of applicants. The “quality” of prospective citizens should be determined neither by their nationality, origin nor wealth, but by their integrity, the lawfulness of their activities and the genuine source of their capital. Verification must include the identification of beneficial owners, the examination of corporate structures, the screening of politically exposed persons, sanctions-list checks and cooperation with foreign financial-intelligence authorities.

The number of approved applications cannot constitute the principal measure of success. A state’s security, reputation and international credibility are worth more than the immediate revenue generated by an inadequately vetted application.

The Caribbean had already begun reforming its programmes

It would, however, be inaccurate to portray the five states as having remained passive in the face of criticism. In its institutional statement entitled “OECS Sets Standards for Citizenship By Investment Programmes to Safeguard Their Integrity and Sustainability,” published on 24 September 2025, the Organisation of Eastern Caribbean States details the agreement signed one day earlier by the five governments to establish the Eastern Caribbean Citizenship by Investment Regulatory Authority, or ECCIRA.

The framework provides for a regional supervisory authority, binding standards for national CBI units and licensed agents, the collection of biometric data, stronger residency and “genuine link” requirements, and comprehensive vetting supported by the CARICOM IMPACS Joint Regional Communications Centre. It also provides for regional registers of applicants, agents and developers, annual public reports, administrative sanctions and the revocation of licences in cases of non-compliance. A common regional minimum investment threshold of US$200,000 has also been adopted. (OECS statement, 24 September 2025)

These reforms were not developed in isolation from Western partners. The OECS states that they resulted from two years of engagement, including the US–Caribbean roundtables held in 2023 and 2024, discussions with the European Commission in Dominica in January 2024, and consultations with the United States, the United Kingdom and the European Commission in Grenada and later in London.

According to the same statement, international partners recognised that dismantling the programmes could have devastating consequences for small island states that rely on this revenue for fiscal stability, climate resilience and economic recovery. However, this assertion must remain explicitly attributed to the OECS: it does not, by itself, constitute a joint and directly verifiable statement from all the partners named.

From negotiated regulation to demanded abolition

The European ultimatum therefore reveals a change in doctrine. Earlier discussions appeared to focus on securing, harmonising and regulating the programmes. Their very existence may now be sufficient grounds for suspending visa-free access when citizenship is granted without a genuine link to the country concerned. (Council of the European Union, 17 November 2025)

The question is therefore profoundly political: what is the purpose of negotiating stronger standards with small states, encouraging them to harmonise their practices and finance a regional regulator, if the eventual objective becomes the disappearance of the regulated instrument itself?

The European Union has the right to protect its borders. It should not, however, use visa-free access to decide unilaterally which financing instruments are acceptable for sovereign states. Before demanding that these programmes disappear, it should assess in good faith the reforms that it helped to bring about through dialogue.
The Caribbean would nevertheless gain nothing from denial. It must make ECCIRA fully operational, publish financial data, sanction illegal discounting and demonstrate the effectiveness of its vetting procedures. It must also progressively reduce its dependence on CBI by developing alternative sources of revenue.

The real choice is therefore not between CBI and integrity. An opaque programme weakens the sovereignty it claims to finance. Yet its externally imposed abolition, without a viable alternative, risks returning small states to dependence on the priorities of international donors. Transparency is not a concession to Europe. It is, first and foremost, an obligation owed to Caribbean people. Sovereignty means both choosing one’s own development instruments and accounting for every dollar collected and spent in the people’s name.