Eluding National Boundaries: A Case Study of Commodified Citizenship and the Transnational Capitalist Class

Abstract

Commodified citizenship—pay x number of dollars and you can have all the rights of citizenship without any of the traditional duties and obligations—has been on the rise in developing countries since the early 1990s. This article is a case study of such a program on the island nation of Dominica. Ostensibly established as a means to aid the country in its efforts to move away from a monoagricultural economy, this article demonstrates that in reality, the government has become fully dependent on the commodified citizenship program, which has become its primary source of quick liquid revenue. Furthermore, we argue that the program can be an excellent tool for the transnational capitalist class which needs to work around political restrictions on their cross-border movements. With a growing effort to impede movement across countries and re-entrenchment of national border across the world, efforts to penetrate national border boundaries and established systems of exclusions through the visa processes have prompted creative and alternative routes for cross-border mobility. The contention here is that commodified citizenship is just one such creative alternative route and is especially ingenious as it is fully legal and uses the very institutions that seek to hinder mobility.

1. Introduction

1.1. Research Question and Case Selection

In the 1990s, a number of developing countries around the world began citizenship by investment (CBI) programs, providing citizenship to foreign nationals in exchange for funds ostensibly for development projects [1]. The Commonwealth of Dominica1 was one of the many countries that grabbed this opportunity for adding cash to its strained budget and to aid with its push for economic diversification. It made changes to its rules regarding naturalization, waiving the seven-year residency requirement in exchange for a cash payment, essentially commodifying its citizenship. Today, Dominica has the cheapest commodified citizenship program in the Caribbean, one that has been riddled with controversy but touted by the government as the best opportunity to move the country ahead especially during the global economic recession which began circa 2007 [2].

Why and under what circumstances did Dominica choose to adopt the commodified citizenship program and how has it shaped the country’s development? Moreover, does commodified citizenship serve a broader purpose in the global political economy, and how? These are the central questions addressed in this article. The article seeks to demonstrate that the commodified citizenship program was implemented to help the country with its economic diversity efforts but the government has become very dependent on that program. Furthermore, from the examination of commodified citizenship in Dominica, we can infer that such a program can offer the freedom of cross-border mobility for the increasing transnational capitalist class. There is a possibility to reshape the global political economy but this has not yet materialized. Although commodified citizenship programs have been on the rise in developing countries, there are practically no studies that look at the inner workings of these programs and very few deal with how they emerge and in what contexts. There are two reasons: (1) the commodified citizenship programs are typically shrouded in secrecy or are procedurally opaque; (2) the surge of these programs within the developing world is relatively new, despite the fact that similar programs have existed in many developed countries (such as the United States under the US Customs and Immigration Services EB-5 Immigrant Investor Program, and until 2014, Canada’s Immigrant Investor Program). Therefore, the case study method is appropriate here, as it allows for the focused detailing and contextualization of this iteration of commodified citizenship.

The logic for the case study in this article is based on Robert K Yin’s [3] methodological strategy and his definition of a case study—an empirical inquiry that investigates a contemporary phenomenon within its real-life context [4]. The Dominica case study affords us the opportunity to view and understand the details of citizenship by investment programs, observe how it emerged within the Dominica context, and understand the implications within the broader global political economy. This methodological strategy is similar to but not the same as Gerring’s idiographic case study or single-outcome studies (focusing on the unique qualities of a case relative to a larger population) [5]. Seawright and Gerring [6] note that in many instances, scholars rely on pragmatic considerations, such as time, money, expertise, or access in case selection, and recommend certain methodological justifications be presented such as the case’s use and representativeness.

Dominica is representative of those islands in the Caribbean that chose to commodify their citizenships. The islands began offering the commodified citizenship program at approximately the same time and all use the same firms (such as Henley & Partners) to market their product. Dominica is politically similar to the other islands in terms of its governing structure (parliamentary system of government); it is economically similar (upper middle income according to the World Bank) and it is a former colony like the other countries offering commodified citizenship. Yet, as noted at the beginning of this section, Dominica offers the cheapest citizenship in the Caribbean, is number one on citizenship by investment rankings [7], and the context in which the program began to thrive (China’s involvement) makes the case an interesting one.

1.2. Background

Based on the sheer number of citizenships sold2, one can argue that it was not until 2014 that the commodified citizenship program really took off. Interestingly, that was the same year that Roosevelt Skerrit and his administration called an early election, dominated the polls, and won a mandate with broad public support. Yet, it is important to understand that the program’s evolution actually began with Skerrit’s election as Prime Minister in 2004 and the very public push for Chinese nationals to purchase Dominican citizenship. This coincided with an about-face vis-à-vis Dominica’s relationship with the Republic of China (ROC) (Taiwan) [8,9] and a demonstration of support by the People’s Republic of China (PRC) in the form of significant foreign aid [8,10,11]. Following the 2004 election, Prime Minister Skerrit, also Minister of Finance, moved to make the sale of citizenship at once more formalized and yet opaque. The process was streamlined with the creation of the citizenship by investment (CBI) unit with a core group of five (as documented in 2015) making the final decisions regarding approval of citizenships.

With China’s growing economic rise and influence in the global economy, and in particular within the developing world, it made sense that the Skerrit administration would push to market Dominican citizenship to Chinese nationals who could afford it. Furthermore, as global economic recession set in, especially in the Global North, countries in the developing world had to be more creative in their responses to the global economy and many turned to the East. In establishing its relationship with China, Dominica’s most important contribution would be in the form of geopolitical currency, not only with its support of China within various international (such as the United Nations) and regional organizations (the Caribbean Community or CARICOM3, the Caribbean Basin Initiative4, etc.) but particularly through its commodified citizenship program.

Once Dominica opened diplomatic and trade relations with China, it received a significant amount, up to a third of Dominica’s GDP, in foreign aid [12] and a renewed interest in its commodified citizenship program. In return, China acquired one more ally willing to sign the One-China Policy5 in the chain of islands in the Caribbean. It also gained an avid supporter in Prime Minister Skerrit who has since been the Chairman of the Organization of the Caribbean States (OECS) and is now the Chairman of CARICOM. I would argue that, above all, Dominica’s commodified citizenship program, one of the cheapest programs in the world, became fully accessible to members of China’s emerging transnational capitalist class (TCC), with access to visa-free travel and potential residency in over 115 countries including the United Kingdom, the European Union, and the Schengen Zone [14]. Currently, Chinese nationals must submit to the visa application process for the UK, EU, the Schengen Zone. In fact, the Chinese passport only grants visa-free travel access to 51 countries [15], most of which are in Asia.

While citizenship by payment or investment—commodified citizenship—is not exclusive to Dominica, and its commodified citizenship program is open to any person who can afford it, when the current government assumed power, its direct marketing strategy for the commodified citizenship was aimed primarily at Chinese nationals [16,17,18]. This may have been in part due to Dominica’s newfound and keen relationship with China. This article explores the idea that, as it stands, Dominica’s commodified citizenship is a natural tool for the TCC6, allowing its members to break down or circumnavigate the barriers created by border controls through passport and citizenship measures. Some TCC members have taken advantage of relatively cheap and easy access to Dominica’s commodified citizenship program, but most have yet to take full advantage of the mobility aspect of their additional citizenship.

Furthermore, from the point of view that nationality is a crucial factor to global socioeconomic stratification [19,20], commodified citizenship provides the possibility to dramatically influence mobility within the stratified world system. Yet, as it stands, at least in the case of the commodified citizenship program in Dominica, this aspect is left largely underexploited. It is only recently that significant inroads have been made in terms of “infrastructural development projects”. The program has been used primarily to generate quick cash inflow to cover unanticipated expenses such as storm and hurricane relief and other government pet projects such as its “Red Clinic”7 [22]. Still, in 2016, it was documented that the commodified citizenship program was one of the country’s biggest revenue generators [23].

This article does not focus on China’s relationship with Dominica in terms of China’s development strategies8 in the Global South, although there is room for research on this front, nor does it analyze China’s involvement in Dominica in terms of China’s typically resource-extraction-driven foreign direct investment, as this does not apply to its relationship with Dominica. Instead, the emphasis of this article is on the commodified citizenship program itself and its potential use by the Chinese TCC and the TCC in general.

The literature on citizenship is rich and takes into consideration changing individual perceptions of citizenship [31,32,33,34,35]. This article adds to the citizenship literature but from the perspective of transnationalization and commodification of citizenship, with only Boatca [1] taking this approach and Abrahamian [36], who reported on the use of purchased citizenship as a means of control in the United Arab Emirates. Other studies concerning multiple citizenships tend to emphasize changing life courses [37] or are discussed from the nation-state point of view and the pressures experienced therein [38,39,40]. Other similar works on transnationalization in the Caribbean have focused on the tourist industry [41], security [42], or the Caribbean’s colonial history and its role in current issues of globalization, sovereignty, and citizenship [43]. This article contributes to both the literature on transnationalization and inequality, areas of research which have not specifically addressed commodified citizenship. Its novelty lies in the case study approach that examines an island nation’s response to pressures and changes, typically experienced by small countries and economies, in a highly globalized sociopolitical-economic system. The article demonstrates how that response can in fact deepen the linkages amongst the various states in that system.

As a general roadmap, the article continues with an explanation of what is meant by commodified citizenship and the details of the Dominican version. This is followed by an analysis of the program in the context of the country’s broader development strategies, and a subsequent analysis of commodified citizenship with the TCC as its natural consumer, with an eye toward inquiring into the link between the Chinese TCC and Dominica’s commodified citizenship program. It closes with an exploration of commodified citizenship as it relates to global socioeconomic stratification and the logic of a program that set out to help diversify Dominica’s economy only to find itself completely reliant on said program.

2. Commodification of the Dominica Citizenship

Dominica’s citizenship by investment and contribution program is commodified citizenship in that it is based on the intensive expansion of capital into civic life. That is, the use of capital (money) in obtaining a public good (citizenship) which would normally fall outside the logic of capital. The Peace of Westphalia (1648) is widely held as the birth of the modern nation-state system and with it, the idea of citizenship (membership in an inclusive political community) [20]. For Turner, the modern understanding of citizenship as a legacy of the French Revolution [44] revolved around the legal status bestowed upon an individual by a nation-state that involves some level of rights and obligations of citizens. These rights and obligations are allocated to individuals by the authority of the nation-state. At its most basic level, (formal) citizenship simply means belonging to a nation-state—a denizen [44]. However, citizenship is increasingly seen as much more than a legal status and encompasses the engagement of individuals and groups to secure and expand civil, political, social, and economic rights within the state [31,45,46].

Citizenship rights, which include civil rights (free expression and movements), political rights (participation in elections and seeking political office), social rights (welfare, education, health), and economic rights (job market, pursue own enterprise), can differ as they all fall under the auspices of the nation-state. It is the state and state law that shape what a nation’s citizenship can entail. Therefore, liberal democracies focus on different aspects of citizenship rights (a heavy reliance on markets to manage social rights but full state control of civil rights) as opposed to social democratic states like northern European countries where citizenship rights are focused on social rights. The same with citizenship obligations—residency, military service, jury duty, taxes, and obedience to the laws imposed by the nation-states. As it stands, commodified citizenship without residency requirements allows for all the “citizenship rights” but none of the citizenship “obligations”, forcing us to rethink the idea and concept of citizenship.

From a purely monetary standpoint, it is rare, although not unusual, to find a citizenship-by-naturalization process that does not involve some form of payment or monetary fee, but this is not the same as commodification of citizenship. In the standard citizenship-by-naturalization process, there are typically application fees, biometric fees, etc. In Switzerland, for example, it could cost up to 2000 CHF depending on the canton through which you are applying for citizenship. Still, citizenship itself is generally thought of as being outside the bounds of capital and profit-making, and the fees involved are typically part of the operational cost of the agencies involved. In the United States and Canada, investors are afforded permanent residency with a path to citizenship through the naturalization process. Although it is similar to the citizenship by investment program in Dominica, the similarity ends with the “investment” aspect of the program. In the US or Canadian programs, the investors live, work, and participate in civic life in the United States or Canada, respectively (at least, that is expected).

However, in Dominica, naturalized citizenship itself has been commodified. An exchange value was given to citizenship by linking a price to it (similar to for-profit educational institutions, toll roads, private water companies, or even privatized healthcare). Citizenship making, which was outside the logic of profit-making and not salable, has now been stripped from any substance and made available for a price. Prior to 1990, Dominica’s laws held that citizenship was based on (1) birth in Dominica, (2) ancestry, and (3) through naturalization, which required residency of a minimum of seven years. In 1990, although one could still apply for naturalization after having resided in Dominica for the minimum number of years, Parliament waived the residency requirement. The residency requirement for Dominica citizenship can be waived if an individual makes a dollar “donation” to (a) the Government Fund or to (b) an approved Real Estate Project.

In August 2014, according to CS Global Partners and the official Dominica Citizenship by Investment (CBI) Unit’s websites, the rates for purchasing citizenship were as follows:

(A)

“Donation” to Government Fund

❑

A—Single Applicant

Non-refundable investment of US $100,000

❑

B—Family Application (one applicant plus spouse)

Non-refundable investment of US $175,000

❑

C—Family Application 2 (one applicant plus spouse and two children under age 18

Non-refundable investment of US $200,000

❑

D—Family Application 3 (one applicant plus more than two children under age 18)

Non-refundable investment of US $200,000 and $50,000 for each additional person under age 18

(B)

Real Estate Investment

❑

US $50,000 for the main applicant

❑

US $25,000 for the spouse of the main applicant

❑

US $20,000 for each child of the main applicant under eighteen (18) years of age

❑

US $50,000 for each dependent of the main applicant above the age of eighteen (18) years, other than his or her spouse.

As of July 2017, the CS Global Partners’ website now indicates that the path to citizenship by payment can be made through (a) “contribution” to the Economic Diversification Fund or “investment” in local preapproved real estate. This is a major change, as individuals and families purchasing citizenship no longer need to invest in a “project”. It is now a simple real estate transaction—the purchase of land—and the prices have increased to a flat rate of US $200,000. As we will discuss later, a “real-estate project” can be interpreted as a path for development, but it is a challenge to construe a “real-estate investment” as such. In fact, if a third of the citizenships purchased in 2015 involved an existing real-estate project, there would be quite a visible infrastructural change on the island.

The process of obtaining citizenship based on a dollar “donation” (now “contribution”) is currently managed through 33 (up from 18 in 2015) “authorized agents” (see

Table 1. List of Authorized Agencies by location of office.

Name of Authorized Agency	Location of Offices
AAA Investor Immigration Ltd.	Roseau
Alick C. Lawrence Chambers/The Nestman Group Ltd.	Roseau
Apex Capital Partners	Roseau and Moscow
Arton Capital (Dominica) Ltd.	Roseau
Bayat Law Group Inc.	Dubai
Belnor Associates Inc.	Roseau
Caribbean Citizenship Inc.	Roseau
Caribbean Commercial & IP Law Practitioners LLP	Roseau
Passpro Immigration Services	Dubai
Caribbean Consulting Services Ltd.	Roseau
Caribbean Consulting Service Ltd.	Rotterdam
Caribbean –Sino Consulting Services Ltd.	Zicak, Portsmouth
CCP Inc.	Roseau
Citizenship Invest Ltd.	Roseau
CTrust Global Ltd.	Dubai
De Freitas, De Freitas & Johnson Chambers	Roseau
Design Management Ltd.	Roseau
Dominica International Investment Corporation Ltd.	Roseau, Tsim Sha Tsui, Kowloon,
Duncan G. Stowe	Roseau
Global Citizenship Programs Ltd.	Roseau
Guide Consultants Inc.	Roseau
Harvey Law Group	Roseau
IMT Inc.	Roseau
Lennox Lawrence	Roseau
Lennox Lawrence (Vardikos and Vardikos)	Athens
Lennox Lawrence (Alfred Management and Business Consultancy)	Dubai
Lennox Lawrence (Corporate Solutions)	St. Kitts
Modern Agricultural Ventures Inc.	Roseau
Montreal Management Consultants Est. Ltd.	Morne Daniel, Roseau, Sharjah
NL Citizenship Ltd.	Roseau
Paradise Citizens	Roseau
Savory and Partners	Dubai
Second Citizenship Ltd.	Roseau
Sunstone Incorporated—Tranquility BeachDominica DOMINICA	Roseau
Verlyn Liz-Ann Faustin	Roseau
Whitco Inc.	Roseau

Source: government of Dominica9 citizenship by investment unit.

) that are approved by the government of Dominica. In addition to these basic fees, for the “donation” version of the commodified citizenship, there is a US $3000 processing fee and US $7500 due diligence fee for an adult plus US $4000 for dependents aged 16 and over. For the purchase of real estate, the processing fee is US $3000 per applicant, the due diligence fee is US $7500 for adult applicants plus US $4000 for dependents aged 16 and over, and the government fees are US $50,000 for a single adult applicant, US $75,000 for a family of up to four persons including the applicant, US $1,000,000 for family of up to six persons, and after the sixth person, the cost is US $20,000 for any additional dependent under 18 and US $25,000 for dependents over 18. This does not include legal fees and other administrative fees. All applications must be submitted through one of the authorized agents even if one is using an attorney, which is typically recommended. Furthermore, all the applications must then be submitted to the small, specialized CBI unit.

Dominica’s citizenship by investment is distinctly a citizenship-for-sale program with clearly stated transactional dollar amounts, a well-defined, albeit opaque process through authorized agents and varying fees associated with this citizenship program. This became quite clear when in 2004, the government made the purchase even more enticing by unambiguously stating on the CBI program website that: (1) there were no property taxes associated with the real estate investment option; (2) that there would be no regulations and taxes on capital gains, wealth, gift, inheritance, or foreign income as a Dominican citizen; (3) that there would be no language requirement to become a citizen; and (4) there would be no regulations to prevent transfer of wealth for whatever reason.

Citizenship is redefined and reconfigured in a way that allows for profit-making and as a functional way of bypassing the limitations of citizenship laws established by states. By this, I mean that for some time, laws enacted by the nation-state limited citizenship for transnationals and individuals of multiple residencies. Since negotiations for any form of “substantive citizenship” have generally happened below and above the level of the nation-state but only the state could enact laws relating to citizenship [31,39,46,47,48], citizenship for the transnational class was problematic. The commodification of citizenship allows this class of individuals the opportunity to circumvent these issues. If it is true that transnational denotes economic, social, political, and cultural processes that supersede the nation-state [49], then the commodified citizenship facilitates the flourishing and expansion of the transnational class. To be clear, this commodified citizenship is not about participating in a global or world citizenry where an obligation to the world takes precedence to that of specific nation-states (à la Hellenistic Stoics described by [50]). It is about a commitment to the continued economic success of a transnational capitalist class that is overlooked by current citizenship considerations.

In the next two sections, we will look at the reasoning behind Dominica’s commodified citizenship and detail the move from Taiwanese to Chinese nationals as its primary target.

2.1. Dominica’s Commodified Citizenship in Context

Dominica gained its independence from Great Britain in 1978, with an economy based primarily on agriculture. Its principal agricultural export was bananas which, at the time of independence, received preferential treatment on the United Kingdom market. Just under a year later, the country was ravaged by Hurricane David and its agricultural sector wiped out. Successive trade tariffs that eroded its preferential treatment along with continued natural disasters forced Dominica to seek new ways to diversify its agricultural sector and its economy, more broadly speaking. Given economies of scale, it was unable to compete on the open market with produce from Latin America, so Dominica turned to small scale manufacturing, the financial sector, and tourism in an effort to weaken its dependence on agriculture.

Boatca has argued that commodified citizenship in Latin America and the Caribbean can be seen as an “alternative development strategy closely linked to a colonial past” that could “bridge the transition from the export monoculture of colonial economy to diversification production after independence” [1]. Still, an examination of the data over time reveals that the Dominica program has been used not as a development strategy per se, but typically as a quick fix to gain a rapid inflow of cash.

Like other Caribbean islands, Dominica inherited a monoagriculture economy from its colonial past, and since independence, has sought to diversify its economy. Equally significant for Dominica’s push away from monoagriculture was the instability of an agricultural economy that was constantly affected by severe storms, hurricanes, and natural hazards including possible volcanic eruption [51,52]. Dominica, as with other Caribbean islands, began commodifying its citizenship program in the early 1990s. During the same period, Western European countries were in the process of forming the European Union, which in turn affected the relationship between Great Britain and many of its former colonies in the Caribbean. It became even more obvious that alternatives to monoagriculture and agriculture in general had to be found. The region saw a big push toward tourism. However, that too is vulnerable to natural hazards such as storms and hurricanes which are often outside of anyone’s control, with consequences that are difficult to mitigate in the economy [53]. This left small-scale manufacturing, small export-oriented industry, financial services, and investments as more viable alternatives.

Data10 on the commodified citizenship program indicate that the early program attracted mostly Republic of China (ROC), Taiwan (hereon, Taiwan) nationals. In 1992, 93 individuals became citizens through the program. Only one of them was not of Taiwanese origin. The following year, 81 out of 82 were of Taiwanese origin. This is not surprising, as there was a high number (relative to other foreign-born individuals) of Taiwanese nationals on the island due to the Taiwan International Cooperation and Development Fund (ICDF)11. Furthermore, Dominica had a relatively strong foreign diplomatic relationship with Taiwan which explains, in part, the significant number of citizenship purchases by Taiwanese.

This initial inflow of cash from the commodified citizenship program went ostensibly to the push for tourism as an alternative to the monoagriculture economy. Yet, the one project—the expansion of the island’s main airport—that embodied the promotion of tourism as a means to diversify the economy received no benefit from the citizenship program. Commodified citizenship was initially presented not as a possible new sector or part of an existing sector, but as a way to accumulate cash to support efforts to refocus the economy to alternative, nonagricultural sectors. In the first few years of the program, a majority of those purchasing Dominican citizenship were Taiwanese nationals living in Taipei, with only three residing in Taichung City, Taiwan and three in Québec City, Canada.

However, by 1994, of the 38 who purchased Dominica citizenship, only three were from Taiwan. This was a marked decline in the total number of citizenships purchased and the total number of purchases by those of Taiwanese origin, thus highlighting the limitations of the program and the marketing strategy employed by the Dominica government. At some point, one will have maximized the number of individuals who can, or are willing to, purchase citizenship at least in a given time period, particularly if your target market is geographically small and limited. Most of the individuals who purchased citizenship in 1994 actually came from China, an indication that the program leaders were already looking for alternative potential clients. Data from 1996 underscores this point. Of the 56 who purchased citizenship, only 7% were from Taiwan, 44% were from China, 33% from Russia, 5% from Estonia, and 7% from the United States.

It is important to keep in mind that in 1995, Dominica elected a new Prime Minister, Edison James, who continued to push for economic diversification [54]. However, the decline in numbers for the citizenship-for-cash program was also affected by the country’s preoccupation with elections and election campaigning. PM James saw the program as a means to help the transition from monoagriculture to a more diverse agricultural crop. By 1998, there were only 14 purchases of Dominican citizenships—9 from China, 4 from Taiwan, and 1 from the United States. In 2000, Dominica was embroiled in its own domestic politics where the commodified citizenship program was a source of immense debate. Edison James was out and a new Prime Minister was elected.

At the global level, China was rising economically and was beginning to flex its newfound power and influence in the developing world.

2.2. Dominica’s Commodified Citizenship since 2004

Since 1971, China has required all countries seeking trade and diplomatic relations with it to adopt the One-China Policy, and it was not until the 2000s that Dominica began to consider turning to China. On 23 March 2004, a few months after assuming office, Dominica’s Prime Minister, Roosevelt Skerrit, signed the One-China Policy, breaking long-held diplomatic relations with Taiwan.

Shortly thereafter, the government announced that Beijing had pledged US $110 million in grants to Dominica over a six-year period. In addition, the PRC announced that it would provide grants to absorb all costs of finalizing existing Taiwan-financed projects on the island. According to a 2004 IMF report, altogether, the grants amounted to about 50% of Dominica’s annual GDP [55]. IMF records show the country’s GDP in 2003 as US $341 million and at US $367 million in 2004. Breaking diplomatic ties with Taiwan was financially a significant move for Dominica. The IMF noted that Taiwan’s aid to Dominica had mostly been in the form of loans as opposed to the grants doled out by China. Furthermore, in 2004, China was Dominica’s largest bilateral creditor [55].

The initial grant offer from Beijing to Dominica was tied to four major infrastructure development projects: a new sports stadium, a new grammar school, the rehabilitation of the main road from the country’s capital (Roseau) to its second largest town of Portsmouth, and finally, a major upgrade of the Princess Margaret Hospital—the only major hospital on the island. The first three major projects were completed by 2011. These projects were managed by Chinese state-owned enterprises (SOEs), built with Chinese equipment brought in from China and Chinese workers to perform all labor involved. Essentially, the Chinese SOEs provided “turn-key” infrastructure with very little social and/or political intrusion in Dominica and all financial benefits were conferred on those running the Chinese SOEs.

Prime Minister Skerrit, now Chair of Organization of Eastern Caribbean States (OECS)12 and previously Chair of CARICOM, continues to tout the PRC’s approach to aid and economic relations as the way of the future and the embodiment of South–South relations. Dominica Ministry of Finance (see

Table 2. PRC Grants to Dominica with Project Descriptions.

Financial Year	Project Description	Budget in Millions XCD	Actual Exp. in Millions XCD
2009–2010	Const. Melville Hall Fire Station	1	0.73
	Reconst. of Portsmouth Secondary School	1.71	1.5
	Rehab. of West Coast Road	5.81	5.81
2010–2011	Const. Melville Hall Fire Station	2	1.28
	Rehab. of West Coast Road	44.18	44.18
	Repairs to Primary Schools	0.214	0.214
	Assistance to Farmers affected
	by Hurricane Tomas	0.28	0.28
	Housing Assistance in LaPlaine	0.045	0.045
2011–2012	Const. Melville Hall Fire Station	3	1.93
	Reconst. of Newtown Primary School	0.4	0.376
	Const. Carib Territory Housing Project	1.3	1.29
	Rehab. of West Coast Road	25	41
	Assistance to Layou River Flood Victims	0.37	0.21
2012–2013	Const. Carib Territory Housing Project	2.6	1.48
	Const. Melville Hall Fire Station	1.8	1.24
2012–2014 (YTD)	Const. Carib Territory Housing Project	1.29	0.84
YTD:8/2014		90.999	102.405

Source: Dominica ministry of finance.

) documented that in 2010, approximately $7.3 million ECD, $46 million ECD in 2011, $44.8 million ECD in 2012, and $2.7 million ECD in 2013 was given to the government of Dominica by the PRC. These funds went to building schools, low-income housing in the Kalinago Territory (previously named Carib)13, and a fire station at the Melville Hall Airport.

With China’s growing involvement in the Caribbean, its relationship with Dominica, details of which are usually secret, remain suspect for some. Therefore, there is a tendency to overstate China’s intentions, motivation, and influence in Dominica and the Caribbean. In September of 2011, President Bharrat Jagdeo of Guyana, while attending the Third China–Caribbean Economic and Trade Cooperation Forum, was quoted in the Asia Times online: “In the last 10 years, China’s exports have consistently accounted for more than 70% of total trade… In 2008, 93% of Caribbean–China trade consisted of China’s exports to the region. The region itself exported significantly (over $60 million in goods) to China in that year” [56]. Yet, the same article noted that China was in fact the third largest direct investor in Latin America and the Caribbean, after the United States and the European Union, accounting for only 9% of foreign direct investment in the region. In a discussion on China’s influence in the Caribbean, the Council for Hemispheric Affairs, in 2012, continued to use Jagdeo’s statement as proof of the PRC’s increasing dominance in the region. In December of 2013, Francis Fukayama’s The American Interest Magazine online blog post ran a headline: “China Takes over Island of Dominica”. The article claimed that while the United States was distracted with its ongoing problems in the Middle East, China was using its so-called “cabbage strategy”14 in the United States’ backyard—a must-watch trend in China’s growing involvement in the Caribbean [12].

As with much of the Western coverage (both academic and popular) of China’s involvement in the Global South, China is presented as a monolith15 slowly taking over the world. In Dominica, China’s interests are in fact geopolitical through commodified citizenship, which plays a major role, and through the isolation of Taiwan and the creation of an ally in a historically geopolitically strategic group of islands.

A look at Dominica’s import–export structure shows very little in the way of preferential treatment or significant impact by China. Cars made up the largest percent of all imports at 6.15% followed by refined petroleum at 4.7%. Food, beverages, tobacco, mineral fuels, lubricants and machinery, and transport equipment were the largest commodity import groups of 2012 [58]. Further, in terms of the country’s import and export partner list (see

Table 3. Percent Share of Top Import Partners.

IMPORTS
2002 Total = $185M US—5% ($46.9M) China—5% ($28.7M) Trinidad and Tobago—11% ($19.6M) South Korea—7.5% ($14M) UK—6.7% ($12.4M) Japan—5.5% ($10.3M)	2008 Total = $361M US—32% ($117M) Trinidad and Tobago—13% ($48.8M) China—13% ($48.7M) UK—3.6% ($12.9M)
2004 Total = $213MUS—27% ($56.8M) China—12% ($26.3M) Trinidad and Tobago—11% ($23.7M) UK—7.7%($16.5M) South Korea—4.4% ($9.31M) France—3.7% ($7.87M)	2010 Total = $321M US—30% ($96.3M) Trinidad and Tobago—10%($33.2M) China—9.8% ($31.4M)
2006 Total = $272M US—29% ($79.8M) Trinidad and Tobago—14% ($37.5M) China—14% ($37.1M) UK—4% ($10.9M)	2012 Total = $258M US—32% ($82M) Trinidad and Tobago—13% ($34.4M) China—5.9% ($15.3M)

Source: the economic complexity observatory calculator May 2018 (https://atlas.media.mit.edu/en/).

and

Table 4. Percent Share of Top Export Partners.

EXPORTS
2002 Total = $68.1M UK—32% ($21.7M) Jamaica—14% ($9.59M) US—8.5% ($5.8M) France—5.9% ($4.02M) Antigua and Bermuda—5.2% ($3.5M)	2008 Total = $97.3M Saudi Arabia—12% ($11.5M) Vietnam—12% ($11.2M) Jamaica—7.7% ($7.5M) UK—7.6% ($7.38M) France—7.5% ($7.25M) Trinidad and Tobago—5.2% ($5.07M)
2004 Total = $77.1M UK—22% ($16.8M) Jamaica—12% ($8.96M) France—10% ($7.71M) Japan—5.5% ($4.23M) Antigua and Bermuda—5.4% ($4.14M)	2010 Total = $59.2M Jamaica—14% ($8.3M) UK—7.8% ($4.64M) France—7.6% ($4.49M) Trinidad and Tobago—7.4% ($4.36M) Saudi Arabia—5.7% ($3.39M)
2006 Total = $80.9M UK—20% ($16.4M) Jamaica—10% ($8.45M) China—9.8% ($7.9M) Antigua and Bermuda—7.2% ($5.85M) France—6.5% ($5.26M)	2012 Total = $81.4M Jamaica—12% ($9.74M) Trinidad and Tobago—8.5% ($6.91M) Saudi Arabia—7.7% ($6.26M) Sweden—5.6% ($4.95M)

Source: the economic complexity observatory calculator May 2019 (https://atlas.media.mit.edu/en/).

), we find that the increasing trade between Dominica and the rest of the Caribbean islands to be more significant than its trading relationship with China.

Given our insights on how the commodified citizenship program works, in the next section, we examine the possible link between commodification of citizenship and cross-border mobility for Chinese TCC and the TCC in general.

3. Commodified Citizenship and the TCC

In Leslie Sklair’s early works on transnationalization, he categorizes the TCC in the Third World in terms of four groups: the expatriate transnational corporation (TNC) executive and their local affiliates; the globalizing state bureaucrats; capitalist-inspired politicians and professionals; and the consumerist elites—merchants involved in promoting consumerism, the North American lifestyle, and free market principles [59,60]. Given their cross-border/transnational character, the TCC can therefore be seen as a natural consumer for commodified citizenship.16

So, what are the benefits of purchasing a citizenship from Dominica that makes it a good tool for the TCC? A citizenship purchased from Dominica is for life and can be passed on from one generation to another. The passport issued with citizenship allows for visa-free travel to 115 countries in the world, including Great Britain, the European Union, and the Schengen Zone (as of 28 May 2015). This is especially desirable for those individuals holding passports to countries with limited travel options based on their first country of citizenship. The current turn in the global political climate, in which national boundaries are being used more and more to shut-out particular segments and groups of people across the globe, makes second citizenships quite desirable. As mentioned earlier, there is also the opportunity for wealth and asset protection; you can legally change your name in Dominica, and your second citizenship is not reported to the authorities of your country of origin.

Of the number of benefits, visa/hassle-free travel using the Dominica passport and wealth and asset protection are probably of greatest interest to those purchasing a second citizenship. While the second citizenship might appeal to those concerned with wealth and asset protection, visa/hassle-free travel becomes extremely important to the TCC. Robinson explains that the TCC, while establishing itself as sans national identity, it utilizes state apparatuses to advance its interests even if it means temporarily drawing on a particular regional or cultural identity. This means that the TCC will happily make use of commodified citizenship if this leads to enhancing their economic welfare [49]. Dunaway and Clelland’s analysis of the number of billionaires coming from the semiperiphery, especially Asia and specifically China, presented at the American Sociological Association 2015, demonstrated that TCC membership was exploding [64].

Dominica’s Prime Minister Skerrit has spent a significant amount of time promoting the country’s commodified citizenship in the PRC and at first glance, the PRC’s TCC appeared to be his primary target market [17]. With the PRC donating significant amounts of money to the Skerrit administration’s infrastructure projects, such as the rehabilitation of the main hospital, school buildings, etc. (see Table 2 and The Sun: Dominica [65]), the main valuable resource Dominica has to offer is its citizenship program. Dominica’s concerted effort to attract and increase its customer base for the commodified citizenship program occurred under the current administration, with the Prime Minister making a number of highly publicized visits to the PRC to promote the program [10,17,18,66,67]. Given the prices of the Dominican citizenship, in the long term, the main Chinese beneficiary of the close PRC–Dominica relationship has to be the transnational capitalist class both in China and in the diaspora. After all, the average Chinese in the PRC cannot afford the price for a second citizenship, even if Dominica’s program is one of the most affordable in the world. To be sure, Skerrit understands quite clearly the target market for the commodified citizenship, given that his trips to the PRC, although ostensibly for diplomatic purposes, tend to focus on meeting with the PRC’s business and investor communities.

The Chinese TCC is ripe for a targeted marketing campaign for commodified citizenship. According to China’s Merchant Bank (CMB), and Bain and Company’s report on China’s private banking industry from 2011, there was an explosion in the number of Chinese individuals with overseas assets between 2008 and 2010. Furthermore, majority of these individuals are pursuing some form of temporary or permanent residency, including dual citizenship, outside of Mainland China. The report notes that at least 60% of China’s high net worth individuals (HNWIs) are considering or have considered investment immigration. Given the burst of Chinese HNWIs seeking some form of residency abroad based on investment, many countries (especially the more desirable countries including the United States, Canada, and Australia) are increasing the requirements for gaining residency. For example, Canada raised the investment requirement from $800,000 Canadian to $1.6 million Canadian. Dominica, while not being the most sought-after country for residency, has made its citizenship program even more appealing by relaxing the rules of residency and investment opportunities, even going as far as creating a new industry for commodified citizenship. The CMB report notes that the HNWIs are seeking immigration for a number of reasons including education of their children, wealth security, preparation for retirement, easy travel abroad, and convenience for overseas investment/business development [68].

While China’s TCC may not immigrate to Dominica for their children’s education, they could use that citizenship as a springboard for entry into other countries. As far as wealth security and convenience for investment/business development, Dominica’s program is consistent with those goals. It is reasonable to see Dominica as an opportunity for the TCC to try out business development ideas and a way to gain indispensable experience and knowledge. Bain and Company’s 2015 report on the Evolution of China’s Private Wealth Market indicates that the trend of seeking investment immigration has not ebbed. In fact, the ultra HNWIs have found investment immigration even more crucial than the rest of the HNWIs. By making a second citizenship financially appealing, Dominica’s commodified citizenship fills an important need for not only China’s HNWIs but generally for China’s transnational class.

In April 2015, Skerrit met privately with a group of Chinese investors in Shanghai to promote second citizenship in Dominica. When asked whether he was concerned about an influx of immigrants to Dominica, Skerrit confidently stated that he was not at all worried. Skerrit knows quite well that those purchasing a second citizenship in Dominica are not looking to relocate there [17]. This is why the residency requirement was removed in the first place. Citizenship obligations were stripped from citizenship and only the rights remained, making it more appealing for purchase.

To a certain extent, it makes sense that in a globalized economy that there is a shift to commodified citizenship and that new and creative ways are found to bypass and evade the restrictions of national borders. As China becomes more integrated into the global economy, the TCC must find workarounds to the constraints on its movements. With cheap second citizenship purchased from Dominica, the Chinese TCC can break free of the bonds placed on it by the national laws of some of their counterparts in the West. They could move relatively freely to other Western countries to engage in those economies. Again, as Robinson [49,69,70] notes, the transnational class has no qualms about competition amongst themselves but is still fully committed to global capitalism. He explains that while the BRICS’s policy attempts to open up global capitalism to the TCC of their respective elites might clash with the interest of the G-7, those policies would in the end further transnationalize dominant groups in those countries [70].

In other words, the BRICS foster and advance the TCC’s class formation and open up space in the global system for more extensive integration and a less asymmetric global capitalism [69]. Significant to this discussion here is the fact that of all the BRICS, China has the strongest relationship with Dominica and there is no reason for Dominica not to continue to target Chinese TCC customers for its commodified citizenship program. Nonini and Ong [71] observe that Chinese transnationalists have developed strategies that redefine and overcome efforts to regulate and control their mobility instituted by postcolonial nation-states. This gives the Chinese transnationalist a character of unpredictable wildness [71]. They rework definitions like citizenship, allowing them to escape constraints placed on them by nation-state regimes. Dominica’s commodified citizenship allows them to do just that. Through Dominica’s citizenship for purchase program, the Chinese TCC can therefore set up shop not only in Dominica but anywhere else the Dominica passport can take them.

Yet, the above only works if the Chinese TCC exploits this opportunity. As we will show later, based on the data available, the number of Chinese nationals purchasing citizenships as a percentage of all purchases was initially high but that has declined in the last few years.

4. Discussion

So far, in this article, we have seen the logic of the commodified citizenship program—how it is defined, the parameters for purchasing a Dominica citizenship, and how it can benefit the TCC, in particular, those of Chinese origin. We have also briefly looked at how little of the program’s revenue had been directed to advance economic diversification and development in Dominica (be it through small-scale manufacturing, export-oriented industry, or agricultural diversification).

It was not until May 2015 that an official announcement was made that a five-star Kempinski hotel was to be constructed and opened in Dominica by United-Arab-Emirates-based developer, Range Development [72]. In fact, this was the first government-approved real estate project under the commodified citizenship program [72]. In July 2016, the government indicated that between 150 and 250 Dominicans were to be employed during the construction phase of the hotel [23]. There have been no other government-approved real estate projects under the commodified citizenship program. In the 2016–2017 Government Budget Address, Prime Minister Skerrit also noted two other planned hotels/resorts—Jungle Bay Resort and Bois Cotelette—which were to add to a more modern and competitive tourist industry in Dominica. While these were not specifically linked to and formally approved as part of the citizenship program, they were presented as potential real estate investments. The government’s idea of development appears to be concentrated on tourism infrastructure and hotels in particular.

In 2001, there was a clear increase in the number of Dominican citizenships purchased, from 16 in 1998 and 3 in 2000 (see Figure 1 for visual reference of the data presented here). Of the 89 that became citizens in 2001, the majority were of Chinese or Russian origin. The decline in 1998 and 2000 may have to do with Dominica’s internal election politics and having tapped out a convenient market (the ROC). Still, the spike in 2001 could be that the government was “catching up” in the processing of applications (as so much of the process is opaque and concealed from the public), but just as likely from having found new and/or additional markets for the citizenship program.

What is particularly interesting is that while the Prime Minister of Dominica had been publicly visiting China, giving talks to Chinese businessmen to promote the citizenship program and touting the new Dominica–China relationship, it is not the number of Chinese nationals purchasing citizenship that is noteworthy. It is the total number of new citizens that is striking. There is no data for 2002 and 2003—Dominica lost two Prime Ministers during this period (both died). In 2004, 16 new citizens were recorded, 22 in 2005, and 44 in 2007.

There was no further data on citizenship by naturalization until July 2015. The data shows 159 individuals purchased and were granted citizenship—with no documentation of place of origin or domicile—between 1 March and 25 June 2015. However, onomastically, one could deduce Middle Eastern origins for a majority of the new citizens. There was no additional data available until February and again in March 2016. The data collected from February 2016 indicate that between 1 July and 31 December 2015, there were 562 citizenships purchased and granted. This meant that a total of 721 citizenships were purchased in 2015. Keep in mind that according to the official government statistics, there are 70,000 people residing in Dominica. The data for March 2016 show that 511 citizenships were purchased and granted in 2013; again, with no documentation of place of origin or domicile. Further, the data suggests that a majority of those new citizens are of Middle Eastern origin. Still, Chinese nationals are well represented in both the list of new citizens in 2013 and 2015, and as before, they are most likely living in China, not Dominica. Nevertheless, having a Dominica passport while domiciled in China does not prevent a member of the Chinese TCC from traveling to any number of countries, visa-free. That option is always open for a Dominican citizen.

Aside from the obvious questions regarding corruption that arise from this data, which admittedly are huge, three issues stand out. The first and second are related. Where is the money (how much) and is it going toward “development”?18 The truth is that only a select few know exactly how many people really purchase citizenships, as there are no real checks-and-balances with regards to the program. The data presented here is based solely on what the government has documented and made available for legal purposes. There is no way to check whether or not data has been omitted.

Infrastructural development outcomes based on dollars received from the commodified citizenship program is open for debate. The Kempinski real-estate project barely began in 2016 with NH International Limited (a Trinidadian firm) as the main structural contractor. The government announced in April 2016 that it would demolish and renovate a bridge in the western part of Roseau called the West Bridge. Construction was completed in 2017 and was opened too much fanfare on May Day 2017. PM Skerrit stated that this was the first phase of its “gradual and deliberate modernization of Roseau” [74]. It is important to note that until the 2016–2017 budget address, in which the government noted that a total of $882.4 million was collected under the program with $356 million collected in tax revenue [75], there was little to no information on the total revenues received from the commodified citizenship program in the government’s budget speeches. However, in its 2018 country report [76], the IMF documents Dominica’s “on-budget” CBI revenues (see Figure 2) based on information from country authorities. Interestingly, it follows a similar pattern to the data collected and reflected in Figure 1.

In the 2011–2012 budget address, a full seven years after Skerrit became Prime Minister, there is no mention of the citizenship program. However, it was noted that agriculture made up approximately 11% of GDP and was reflective of a 10% decrease in 2010. The hotel and restaurant sector grew in 2011 by under 1% and the number of cruise ships visiting the island grew by around 3% [77]. Despite this, tourism has continued to be a major focus of the government; and while the number of international visitors has generally increased, we can see in Figure 3 that the numbers do fluctuate year in, year out.

In 2014, the Skerrit administration announced that it had changed some of the rules regarding the citizenship program with an eye toward boosting foreign direct investment (FDI), particularly FDI aimed at tourism infrastructure [78]. In the 2015–2016 budget address, it was announced that the government of Dominica and Morocco were undertaking a joint venture in building a new hotel. As mentioned in the introductory sections of the article, the commodified citizenship program began as a means to generate cash to help primarily with economic diversification, including boosting the tourism industry.

Still, refocusing an economy that was primarily agricultural to become primarily based on tourism is still a dangerous prospect for a small island nation. In August 2015, the agriculture sector was devastated by Tropical Storm Erika. There was severe destruction of much of the island’s infrastructure including its hotels. Things have been made worse by Hurricane Maria in 2017, two years later. Tourism also continues to be affected by the natural disasters as reflected in the data presented in Figure 3. This is why economic diversification is so important in the Dominica context. The citizenship program, is subject to political pressures and volatile receipts. The IMF has indicated that despite the increasing revenue from the commodified citizenship program, if the program was to end (slowly or abruptly), the effect on Dominica’s economy would be an unsustainable increase in public debt. It recommended policies geared toward significant debt reduction and savings, as well as a stronger transparency framework for the commodified citizenship program [76].

The third issue comes from the potential further explosion of the numbers of new citizens of Dominica, and how commodified citizenship can speak to the issue of global inequality. While the commodified citizenship program can benefit factions of the TCC currently domiciled in Dominica, few actually reside there. According to Sklair, members of the TCC, especially those of the Third World do not live there for legal reasons but this is changing rapidly [59]. The data on Dominica’s commodified citizenship program appear to support this. Those purchasing second citizenships in Dominica have been from middle-income countries (as defined by the World Bank) and have remained domiciled either in their country of origin or in another middle-income country; very few people in the Global North are purchasing second citizenships in the developing world, and this is expected. As Korzeniewicz and Moran [19] explained, the value of citizenship is directly proportional to a country’s location in the stratified world-economy. Zolberg also argues that by restricting immigration, “core” states in the Westphalian international state system are able to maintain this highly unequal system [20].

One of Korzeniewicz and Moran’s [19] major argument is that nationality plays a significant role in where a person falls vis-à-vis other individuals in terms of global inequality, meaning that a member of Mexico’s top five percent does not hold the same place in global socioeconomic stratification as one of the United States’. “Global stratification… does not equal adding up the ‘elites, ‘middle classes,’ and ‘working class’ or ‘poor’ from different countries, as if they all occupied the same objective position. … [It] involves … intersecting processes in which national identity itself becomes the crucial axis of inequality” [19]. Given the three paths to upward mobility for an individual, in terms of global stratification (work within the constraints of within-country inequality and attempt to move up through educational or occupational achievement; work within the bounds of the nation-state and increase the gross national income; or move from a low-income country to a high-income country), the authors argue that the third path is the most effective and expedient.

The authors also maintain: “A truly free flow of people across the world, in fact, would provide the fastest means for thoroughly transforming the equilibria that characterized global stratification for the past two hundred years” [19]. Given the above, commodified citizenship could and can play a large role in reducing overall between country inequality. However, this only works if commodified citizenship crosses the North–South divide. For now, the data shows that Dominica’s program mostly attracts nationals from other middle-income countries. The most it can do in terms of overall global inequality would be to help level out the middle strata of the stratified world-economy. For now, though, the reality is that if the Skerrit government is elected out of office, China’s and all others’ access to Dominica’s commodified citizenship could end.