Annual Report on Exchange Arrangements and Exchange Restrictions 2005
Chapter

ST. VINCENT AND THE GRENADINES

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2005
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(Position as of December 31, 2004)

Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: August 24, 1981.
Exchange Arrangement
CurrencyThe currency of St. Vincent and the Grenadines is the Eastern Caribbean dollar, which is 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, under a currency board arrangement, at EC$2.70 per US$1.
Exchange taxNo.
Exchange subsidyn.a.
Forward exchange marketNo.
Arrangements for Payments and Receipts
Prescription of currency requirementsSettlements with residents of member countries of the CARICOM may be made in any currency. Settlements with residents of other countries may be made in any foreign currency or through an external account in Eastern Caribbean dollars.
Payments arrangements
Regional arrangementsSt. Vincent and the Grenadines is a member of the CARICOM.
Administration of controlExchange control is administered by the MOF and applies to all countries outside the ECCB area. Effective December 6, 2004, transactions exceeding the equivalent of EC$250,000 in foreign currency no longer require approval from the MOF. The MOF delegates to ADs the authority to approve some import payments and certain other payments. Exchange controls are not applied to payments for authorized imports.
International security restrictionsn.a.
Payments arrears
OfficialA moratorium has been sought on some debt payments relating to shipyards, pending settlement of issues under dispute with creditors.
Controls on trade in gold (coins and/or bullion)
Controls on domestic ownership and/or tradeResidents are permitted to acquire and hold gold coins for numismatic purposes only.
Controls on external tradeImports of gold are permitted under license by the MOF for industrial purposes only.
Controls on exports and imports of banknotesn.a.
Resident Accounts
Foreign exchange accounts permittedn.a.
Accounts in domestic currency held abroadn.a.
Accounts in domestic currency convertible into foreign currencyn.a.
Nonresident Accounts
Foreign exchange accounts permittedThese accounts may be opened by nonresidents with the authorization of the MOF and credited only with funds in the form of remittances from overseas. Prior permission of the MOF is required to credit these accounts with remittances in Eastern Caribbean dollars, foreign currency notes and coins, and payments by residents. These accounts may be debited for payments abroad without prior authorization from the MOF. The operating banks must submit quarterly statements of the accounts to the MOF.
Domestic currency accountsExternal accounts may be opened for nonresidents with the authorization of the MOF. They are maintained in Eastern Caribbean dollars and may be credited with inward remittances in foreign currency and with transfers from other external accounts. Credits and debits to these accounts are subject to the regulations governing foreign exchange accounts.
Convertible into foreign currencyn.a.
Blocked accountsn.a.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for imports
Advance payment requirementsEffective December 6, 2004, advance payments for imports exceeding the equivalent of EC$250,000 no longer require prior approval from the MOF.
Documentation requirements for release of foreign exchange for importsPayments for authorized imports are permitted upon application and submission of documentary evidence and, where required, a license.
Import licenses and other nontariff measuresMost goods may be imported freely. Imports of some goods that compete with typical exports of other member countries of the CARICOM and the OECS are subject to licenses.
Negative listImports of certain goods that compete with locally made products are prohibited.
Import taxes and/or tariffsIn accordance with the fourth phase of the CARICOM CET, the import tariff rates range from zero to 20%. In addition, imports are subject to a consumption tax ranging from 5% to 50% and levied on the tariff-inclusive value of imports. Goods imported from CARICOM member countries are exempt from import tariffs and are subject only to the consumption tax. A customs service charge of 4% is imposed on the c.i.f. value of all imported goods, with certain exceptions.
State import monopolyn.a.
Exports and Export Proceeds
Repatriation requirementsYes.
Surrender requirementsAll export proceeds must be surrendered within six months of receipt.
Financing requirementsn.a.
Documentation requirementsn.a.
Export licensesSpecific licenses are required for the exportation to any destination of some agricultural goods included in the CARICOM marketing protocol and in the CARICOM Oils and Fats Agreement. The licenses are issued by the Ministry of Trade, which, in some cases, has delegated its authority to the St. Vincent Central Marketing Corporation. Exports of goats, sheep, and lobsters are subject to licensing to prevent depletion of stocks.
Export taxesNo.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersPayments for invisibles related to authorized imports are not restricted. Effective December 6, 2004, other payments exceeding the equivalent of EC$250,000 no longer require approval from the MOF.
Payments for travel
Quantitative limitsQuantitative limits
Indicative limits/bona fide testThese allocations may be increased with the authorization of the MOF.
Personal paymentsInformation is not available on the transfer of funds for pensions, family maintenance, and alimony.
Other paymentsEffective December 6, 2004, the limit for subscriptions and membership fees up to the equivalent of EC$250,000 a transaction no longer applies.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsYes.
Surrender requirementsYes.
Restrictions on use of fundsn.a.
Capital Transactions
Controls on capital transactionsEffective December 6, 2004, outward capital transfers exceeding the equivalent of EC$250,000 no longer require prior approval from the MOF.
Controls on capital and money market instruments
On capital market securities
Shares or other securities of a participating nature
Purchase abroad by residentsResidents are normally not permitted to purchase foreign currency securities abroad for private purposes.
Bonds or other debt securities
Purchase abroad by residentsYes.
Sale or issue abroad by residentsYes.
On money market instruments
Purchase abroad by residentsYes.
On collective investment securities
Purchase abroad by residentsYes.
Controls on derivatives and other instruments
Purchase abroad by residentsYes.
Controls on credit operations
Commercial credits
By residents to nonresidentsMOF approval is required.
Financial creditsYes.
By residents to nonresidentsMOF approval is required.
Controls on direct investment
Outward direct investmentYes.
Controls on liquidation of direct investmentThe remittance of proceeds is permitted, subject to the discharge of liabilities related to the investment.
Controls on real estate transactions
Purchase abroad by residentsYes.
Purchase locally by nonresidentsYes.
Controls on personal capital transactionsn.a.
Provisions specific to commercial banks and other credit institutions
Borrowing abroadAny borrowing abroad by ADs to finance their domestic operations requires the approval of the MOF.
Provisions specific to institutional investorsn.a.
Other controls imposed by securities lawsn.a.
Changes During 2004
Arrangements for payments and receiptsDecember 6. The requirement of MOF approval for transactions exceeding the equivalent of EC$250,000 was abolished.
Imports and import paymentsDecember 6. The requirement of MOF approval for advance payments for imports exceeding the equivalent of EC$250,000 was abolished.
Payments for invisible transactions and current transfersDecember 6. The limit on payments for subscriptions and membership fees of up to the equivalent of EC$250,000 was lifted.
December 6. The limit on payments for subscriptions and membership fees of up to the equivalent of EC$250,000 was lifted.
Capital transactionsDecember 6. The requirement of MOF approval for outward capital transactions exceeding the equivalent of EC$250,000 was abolished.

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