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Saint Lucia Country Report

Country Risk Level


Overview

Executive Summary

The United Workers Party (UWP) government of Prime Minister Allen Chastanet is relatively stable, holding 11 of the 17 seats in the House of Assembly. The opposition St Lucia Labour Party (SLP) remains likely to stage protests against government policy over the next year, particularly over the economy and healthcare, as the country prepares for elections in 2011. Protests are likely to be peaceful, for example as occurred when thousands protested in September 2018 in an anti-government march led by the SLP. In April 2020, the government unveiled temporary income support and tax deferrals for businesses and individuals to deal with the initial outbreak of COVID-19 on the island. This was followed in July 2020 by a more extensive USD214-million Economic Recovery and Resilience Plan to help the economy recover from the longer-term damage caused by the pandemic. The recovery plan is based primarily on an acceleration of capital works programmes, funding to aid the key tourism sector and reduced energy bills for consumers. St Lucia’s economy remains reliant on tourism, which has been deeply affected by the COVID-19 outbreak. IHS Markit forecasts an economic contraction of 9.5% for 2020. The country’s debt burden also remains a concern, which is likely to deteriorate further in 2020 driven by additional borrowing to support the economy through the aftermath of COVID-19. Violent crime continues to be a high risk in St Lucia, with 51 reported homicide victims in 2019, up from 44 homicides for 2018. This followed a 94% surge in homicides in 2017 to 60, from 31 in 2016. By the end of July 2020, 26 murders had been committed on the island. The primary security risk for foreign visitors is theft. Those resisting robberies and mugging face higher death and injury risks.

Operational Outlook

Risks arise from natural hazards, especially hurricanes, and the island’s poor transport infrastructure, which would benefit from upgrades and expansion. Companies operating in St Lucia are likely to face tax-related reputational risks should the EU, which is urging tax transparency, re-blacklist the country as a tax haven following warnings it has issued, with the country being still under scrutiny. To open a business, companies need five procedures and an average of 11 days, according to the World Bank 2020 Doing Business report. The labour movement does not represent a significant operational constraint, although occasional strikes can occur.

Terrorism

There are no domestic terrorist groups with the intention or capability to conduct terrorist attacks within St Lucia. The country's relatively close relations with the United Kingdom and the United States increase the risks of the tourism sector being targeted, but such risks are low. The island is not considered a target for international terrorist organisations.

Crime

The number of homicides in St Lucia increased in 2019, with 51 homicides recorded, up from 44 for 2018. By the end of July 2020, there had been 26 murders. St Lucia remains vulnerable to money laundering, with the island being named as a "major money laundering jurisdiction" in the US State Department's 2020 International Narcotics Control Strategy Report (INCSR).

War Risks

St Lucia’s foreign relations initiatives predominantly focus on economic development and aid. A minor territorial dispute over Bird Rock/Isla de Aves exists with Venezuela, but is likely to be resolved through diplomatic channels. St Lucia faces little in the way of external threats and there is a low interstate war risk. In July 2017, St Lucia signed maritime boundary agreements with Barbados and Saint Vincent and the Grenadines during the Caribbean Community (CARICOM) meeting held in Grenada, thereby further reducing the risk of local disputes.

Social Stability

Short-term strike action by groups such as the National Workers Union or civil servants is relatively common, but such action is largely peaceful. The opposition St Lucia Labour Party (SLP) is likely to stage protests against government policy over the coming year in the run-up to elections in 2021. In September 2018, the SLP attracted thousands of protestors to demand early general elections in the country's apparent largest ever protest; the main risk of such protests tends to be traffic disruption as violence is not usually promoted. In June 2020, there was a peaceful protest in Constitution Park in Castries relating to the Black Lives Matter movement.

Risk Level
Critical High Medium Low Minimal