Chapter

ST. KITTS AND NEVIS

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2000
Share
  • ShareShare
Show Summary Details
Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: December 3, 1984.
Exchange Arrangement
CurrencyThe currency of St. Kitts and Nevis is the Eastern Caribbean dollar, issued by the ECCB.
Exchange rate structureUnitary.
Classification
Exchange arrangement with no separate legal tenderThe Eastern Caribbean dollar is pegged to the U.S. dollar, the intervention currency, at EC$2.70 per US$1. The ECCB also quotes daily rates for the Canadian dollar and the pound sterling.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketNo.
Arrangements for Payments and Receipts
Prescription of currency requirementsSettlements with residents of ECCB countries must be effected in Eastern Caribbean dollars.
Payment arrangements
Regional arrangementsSt. Kitts and Nevis is a member of the CARICOM.
Administration of controlExchange control is administered by the MOF and applies to all countries.
International security restrictionsn.a.
Payment arrearsNo.
Controls on trade in gold (coins and/or bullion)No.
Controls on exports and imports of banknotesNo.
Resident Accounts
Foreign exchange accounts permittedU.S. dollar accounts may be operated freely, but permission of the MOF is required to operate other foreign currency accounts.
Held domesticallyThese accounts may be credited only with foreign currency earned or received from abroad and may be freely debited. A minimum balance of US$1,000 must be maintained at all times to operate a U.S. dollar account. Permission is normally confined to major exporters.
Accounts in domestic currency convertible into foreign currencyn.a.
Nonresident Accounts
Foreign exchange accounts permittedThe same regulations apply as for residents. Permission to operate foreign currency accounts is normally confined to foreign nationals not ordinarily residing in St. Kitts and Nevis.
Domestic currency accountsn.a.
Blocked accountsn.a.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for imports
Advance payment requirementsAdvance import payments exceeding EC$250,000 require prior approval from the MOF.
Documentation requirements for release of foreign exchange for importsPayments for authorized imports payable in foreign currency are permitted on presentation of documentary evidence of purchase to a bank.
Import licenses and other nontariff measuresIndividual licenses are required for imports that compete with local products unless they come from another member country of the CARICOM.
Open general licensesMost goods are imported under OGLs.
Import taxes and/or tariffsSt. Kitts and Nevis applies the CET of CARICOM, which ranges up to 30%.
State import monopolyn.a.
Exports and Export Proceeds
Repatriation requirementsYes.
Surrender requirementsExport proceeds must be deposited into an ECCB currency account or an approved U.S. dollar account.
Financing requirementsn.a.
Documentation requirementsn.a.
Export licensesSpecific licenses are required for the exportation of certain goods to any destination. However, the regulations governing export licenses are not formally adhered to.
Export taxesExport duties are levied on a few products.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersPrior approval of the MOF is required for all transactions exceeding EC$250,000.
Investment-related paymentsProfits and dividends may be remitted in full, subject to confirmation of registration by the Commissioner of Inland Revenue for income tax purposes. Information is not available on the payment of amortization of loans or depreciation of direct investments.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsYes.
Surrender requirementsProceeds must be sold to a bank or deposited into an approved U.S. dollar account if the proceeds are in U.S. dollars.
Restrictions on use of fundsn.a.
Capital Transactions
Controls on capital and money market instrumentsIndividuals are permitted to purchase up to EC$250,000 without exchange control approval. All outward capital transfers exceeding that amount require exchange control approval.
On capital market securities
Shares or other securities of a participating nature
Purchase locally by nonresidentsFor purchases of equity shares, an Alien’s Land Holding license is required.
Sale or issue locally by nonresidentsForeign exchange approval from the MOF is required for amounts exceeding EC$250,000.
Purchase abroad by residentsThe same regulations apply as for the sale or issue by nonresidents of capital market securities.
On money market instruments
Sale or issue locally by nonresidentsThe same regulations apply as for the sale or issue by nonresidents of capital market securities.
Purchase abroad by residentsThe same regulations apply as for the sale or issue by nonresidents of capital market securities.
On collective investment securities
Purchase locally by nonresidentsThe same regulations apply as for the sale or issue by nonresidents of capital market securities.
Sale or issue locally by nonresidentsThe same regulations apply as for the sale or issue by nonresidents of capital market securities.
Sale or issue abroad by residentsThe seller of the instruments has to be licensed under the Banking Act, and transfers abroad in excess of EC$250,000 require approval from the MOF.
Controls on derivatives and other instrumentsPresently, there is no market in derivatives and other instruments.
Controls on credit operations
Financial credits
By residents to nonresidentsMOF approval and payment of a 2.5% Alien’s Loans Levy is required for these transactions.
To residents from nonresidentsForeign exchange approval from the MOF is required for amounts exceeding EC$250,000.
Guarantees, sureties, and financial backup facilitiesForeign exchange approval from the MOF is required for amounts exceeding EC$250,000.
Controls on direct investment
Outward direct investmentForeign exchange approval from the MOF is required for amounts exceeding EC$250,000.
Inward direct investmentInvestments in equity require an Alien’s Land Holding license.
Controls on liquidation of direct investmentThe remittance of proceeds of the liquidation of direct investments is permitted, subject to the discharge of any liabilities related to the investment. Transfer of proceeds exceeding EC$250,000 requires MOF approval.
Controls on real estate transactions
Purchase abroad by residentsPurchasing real estate abroad for private purposes is not normally permitted.
Controls on personal capital movements
Transfer of gambling and prize earningsYes.
Provisions specific to commercial banks and other credit institutions
Lending to nonresidents (financial or commercial credits)MOF approval and payment of a 2.5% Alien’s Loans Levy are required.
Lending locally in foreign exchangeMOF approval is required, which is granted only in the case of projects generating foreign exchange to service the loan. The purchase of locally issued securities denominated in foreign currencies requires MOF approval.
Provisions specific to institutional investorsn.r.
Other controls imposed by securities lawsNo.
Changes During 1999
No significant changes occurred in the exchange and trade system.

    Other Resources Citing This Publication