St. Lucia - Foreign investment

Firms based in Canada, the United States, the United Kingdom and other EC members, Venezuela, Hong Kong, and the Republic of Korea are the principal investors in St. Lucia. Two free-trade zones operate on the island, and a goods distribution free zone was opened in 2000.

The government, through the St. Lucia National Development Corporation, set up five industrial zones in order to attract foreign investment in manufacturing and assembly type operations. A Data Entry Park was built to attract information processing operations to St. Lucia. Development incentives are available in the form of tax concessions of up to 15 years in industries prescribed as beneficial to St. Lucia, namely in the manufacturing and tourist industries.

In 1996, St. Lucia was granted a US $955 thousand loan from the Caribbean Development Bank (CDB). The money was used to partly finance a project to help poor households in rural districts diversify agricultural production in order to decrease dependence on the banana industry. The banana industry was highly subsidized during 1999 and 2000 by the EU through the Banana Industry Trust Company, despite the need for diversification. Other investment in 2000 came from the Japanese government to encourage growth of the fishing industry, and from the Chinese government in construction and manufacturing.

Annual foreign direct investment (FDI) inflow was approximately $50 million in 1997, but rose to an average of about $83 million in 1998 and 1999. In 2000 and 2001, average annual FDI inflow was about $50 million.

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