VZCZCXRO7712
PP RUEHGR
DE RUEHWN #0615/01 1362056
ZNR UUUUU ZZH
P 162056Z MAY 07
FM AMEMBASSY BRIDGETOWN
TO RUEHC/SECSTATE WASHDC PRIORITY 4734
INFO RUCNCOM/EC CARICOM COLLECTIVE
RUEHCV/AMEMBASSY CARACAS 1723
RUCPDOC/DEPT OF COMMERCE WASHDC
RUMIAAA/HQ USSOUTHCOM J2 MIAMI FL
RUMIAAA/HQ USSOUTHCOM J5 MIAMI FL
RUEHCV/USDAO CARACAS VE

UNCLAS SECTION 01 OF 02 BRIDGETOWN 000615 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
STATE FOR WHA/CAR 
STATE FOR EEB/CBA AND EEB/IFD/OIA 
STATE FOR L/CID AND L/WHA 
STATE FOR CA/OCS/ACS/WHA 
SOUTHCOM ALSO FOR POLAD 
 
E.O. 12958: N/A 
TAGS: EINV CASC PGOV KIDE SC XL
SUBJECT: ST. KITTS:  GOVERNMENT EXPROPRIATION LEAVES AMCITS 
IN THE DARK 
 
 
¶1.  (SBU) SUMMARY:  Embassy Bridgetown continues to assist 
Amcit property owners in the expropriation case involving the 
government of St. Kitts and Nevis (GOSKN) and the Angelus 
resort.  The GOSKN has mishandled the case by providing poor 
information to the owners and delaying the resolution of the 
Amcit owners' claims.  While seeking to attract investment 
from large resort operators, GOSKN may have undermined its 
image among smaller investors, who may be equally important 
to the island's economic future. 
 
---------- 
Background 
---------- 
 
¶2.  (SBU) In November 2006, the Embassy received a series of 
complaints from eight Amcits who owned condominiums at the 
Angelus Resort and Spa, a 108-unit combination hotel and 
condominium complex on St. Kitts' Frigate Bay.  (NOTE:  Post 
received complaints from eight Amcits, but it is possible 
that there are additional Amcit owners that have not 
contacted Post.  END NOTE.)  Initially, property owners 
requested advice to protect their investments.  Post advised 
them to seek local legal counsel, but some responded that 
attorneys in St. Kitts were not interested in taking their 
cases.  The office of Congressman Dave Camp (MI-04) expressed 
interest in the case via e-mail on February 6, to which Post 
responded. 
 
¶3.  (SBU) The GOSKN expropriated the Angelus resort in 
September 2006 through a resolution of the National Assembly. 
 In his announcement of the action, Prime Minister Denzil 
Douglas justified the takeover by saying that the management 
of the resort found itself unable to meet its commitment to 
the GOSKN with respect to development of the property or its 
ability to satisfy its creditors and service providers.  The 
GOSKN's intent, Douglas stated, was to sell the property to a 
corporation which would develop a five-star hotel on the 
site.  It is rumored that the Marriott Corporation, which 
owns the 573-room St. Kitts Marriott Resort and Royal Beach 
Casino located directly across the street from the Angelus 
complex, discussed the purchase of the property with the 
GOSKN. 
 
---------------- 
Power Turned Off 
---------------- 
 
¶4.  (SBU) In December 2006, the Amcit owners contacted Post a 
second time.  Many of the tenants were students at the Ross 
University's School of Veterinary Medicine.  (NOTE:  Ross 
University, part of the DeVry group of universities, is an 
American university with a campus in St. Kitts.  END NOTE.) 
Post learned from the owners that electricity had been turned 
off at the Angelus resort because the resort's management 
failed to pay the electricity bill.  Break-ins occurred at 
the Angelus during the black out, raising concern about the 
tenants' safety.  Post contacted GOSKN Attorney General 
Dennis Merchant and convinced him that the situation posed a 
threat to the safety of the Amcit residents and others. 
Merchant arranged for the lights to be turned back on until 
the tenants could relocate and also to allow those who wanted 
to remain at the Angelus to do so temporarily.  Merchant 
detailed additional police officers to the Angelus, and Ross 
University stepped up its security patrols on the premises as 
well. 
 
--------------------------------------- 
Inland Revenue Becomes Point of Contact 
--------------------------------------- 
 
¶5.  (SBU) In February 2007, the Attorney General's Office 
designated the Comptroller of Inland Revenue, Beverly 
Williams, as the point of contact for the Angelus property 
owners.  Post provided the Comptroller's contact information 
to the owners, along with a list of attorneys.  According to 
Williams, Inland Revenue has collected information from the 
owners about their property titles and value.  However, Post 
continues to receive complaints from the property owners 
about the lack of information regarding the GOSKN 
 
BRIDGETOWN 00000615  002 OF 002 
 
 
compensation plans.  Some have stated that the Comptroller is 
unwilling to speak with them. 
 
¶6.  (SBU) After a number of unproductive phone calls and 
e-mails to the Attorney General's Office, the Consul General 
finally spoke on April 23 with Williams, the Comptroller of 
Inland Revenue.  Williams said that her office has been 
conducting a survey of the property in order to arrive at a 
"fair market value" for each unit.  She added that the survey 
was nearly complete.  Once the survey is finalized, Williams 
plans to inform the owners of the price the GOSKN is prepared 
to offer as compensation for the expropriation of their 
condominiums.  As of May 15, the property owners had heard 
nothing from Williams. 
 
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COMMENT 
------- 
 
¶7.  (SBU) The actions of the GOSKN in the Angelus 
expropriation case demonstrate that the GOSKN is making large 
hotel investments a priority in its tourism sector 
development strategy, even if it is at the expense of smaller 
investors.  For the past two years, St. Kitts has posted 
significant economic growth, mostly as a result of 
large-scale tourism investments, with the Marriott being the 
island's flagship hotel development.  The GOSKN may view the 
expropriation of Angelus as a small price to pay for its 
ambitious development goals. 
OURISMAN