While citizenship by investment has long been associated with a few select locales, most people remain unaware of how widespread the options are. Although it’s true that Caribbean nations have had their tourism-based economies so badly affected by the coronavirus restrictions on movement that they are slashing prices on investment citizenship, it is not only island nations that offer citizenship status to those prepared to invest in the local economy, writes Rachel Smith.
Many European, South American and other countries across the globe value the potential cash injection into their economies and offer citizenship security as an exchange for such largesse. St. Kitts and Nevis are leading the charge in the Caribbean region, having slashed their citizenship by investment (CBI) offer by around a quarter until end 2020. In addition, the citizenship offer encompasses passports for a family of four, not just the primary investor.
Barbuda, Antigua and Dominica are pitching prices even lower, asking less than $150,000 USD for full citizenship. Foreigners who avail themselves of these offers are typically allowed to hold dual citizenship for both their new home as well as their country of origin.
WHERE TO GO AND WHAT TO DO: THE EU
Faced with a large array of second passport options, investors should first decide what it is that motivates them to seek foreign citizenship. Very often, some destinations will be more geared for rolling into business due to their low taxes or other incorporation leniency. Other citizenship by investment programmes, might be better suited to retirement and safeguarding personal wealth — based on the country’s respect for money earned elsewhere, its geographical location, or even the nature of local industries that form the economy.
In Europe, Cyprus offers a residency option via real estate investment. The country is one of the most costly options within the EU, but its dynamic economy, high Human Development Index and touristy feel, make it rather attractive to those who really are looking to invest in property. The culture is that of the Mediterranean: gregarious, healthy and satisfyingly cosmopolitan. At a total cost of €2,150,000 for full citizenship, Cyprus offers much but asks an initial lump sum in return. Of course, as an EU member, citizens can study, work and live in any member country with a Cyprian passport.
Ireland offers its Golden Visa Programme to foreigners willing to invest €1,000,000 in an approved investor fund as outlined by Irish legislation. After five years, full citizenship is granted. The offer also hinges on an applicant’s clean criminal record and a net worth of €2,000,000.
As a tech hub and the closest that EU residents will get to a flight across the Atlantic to the US, Ireland is proactive in its economy and society, but for many, the weather is a literal dampener. For those seeking more sunshine, Spain is a very attractive option in Europe. A mere €500,000 invested in real estate, will get you a ‘golden visa’ and applicants do not need to reside in Spain to qualify for a biannual renewal as time goes on. If full citizenship after 10 years is desired, however, Spain does then expect you to remain resident within its borders to qualify.
Portugal offers a very similar programme with an €350,000 investment requirement in property development and only a two-week stay per annum to have the residency renewed every two years. Full citizenship after 10 years will require applicants to pass a language test. Both Spain and Portugal enjoy better weather than many of their northerly neighbours, and this is frequently a strong pull for foreign investors averse to protracted snowfall and cold. Although there are more dynamic business locales elsewhere on the continent, travel is fast and cheap between EU states, and their requirements are less onerous than Cyprus, which leads the pack in terms of cost.
Greece beats Portugal on costs with an investment requirement of around €300,000 once fees and taxes have been added. Full citizenship is available after seven years. In the UK, with London still the financial capital of the world, there is no allowance for investment in real estate as a means to citizenship.
Two interesting options are available, however. For entrepreneurs who have a minimum of £50,000 to their name and a viable and scalable business idea, an Innovator Visa will allow for residency and the conduct of business. Alternatively, a Start-up Visa can be obtained with no capital requirements, provided the business concept meets certain criteria. The Innovator Visa allows for permanent residence within three years and citizenship in five.
Other European countries like Austria and Bulgaria, for example, also offer citizenship by investment, and each application is evaluated on its own merits. Very often with European countries, CBI is also enabled by investment in government bonds, as opposed to property.
LOOKING SOUTH: LATIN AMERICAN OPPORTUNITIES
South America is a continent with a lot to offer in terms of investment opportunities. Many under-sung countries offer incredible natural splendour, well established commerce and industries, and very favourable entry requirements and taxation rates. In Paraguay, the residency by investment programme is one of the most affordable offered by any country. A mere $70,000 USD in investment(s) will allow for residency that leads to citizenship, and the amount can be staggered over 10 years. Real estate, broader commerce and agriculture can all enable foreign nationals to become eligible for citizenship.
Agricultural powerhouse Brazil offers residency through investment too, and the vehicle can be agricultural, real estate or industry. An investor’s whole family gains residency, with citizenship eligibility after a mere four years. With an investment requirement of anything in excess of $150,000 USD, Brazil presents as eminently reasonable and attractive as it services various well-established markets on the home front and abroad, typically on a massive and stable scale. Chile is another Latin American country that many find attractive as the eligibility requirements are low, permanent residence comes after a single year and citizenship after five.
Around $75,000 USD will enrol foreigners in the CBI program in a major Chilean city, while for those looking to establish out of metropolitan hubs, even lower cash requirements exist. Brazil, Paraguay, Chile, Costa Rica and Panama, are widely seen as the most peaceable and stable countries both for business and retirement in Latin America.
ALL THINGS CONSIDERED: PRICE, DURATION AND STABILITY
Affordability for those who are looking at citizenship by investment is obviously far better outside of Europe. Going the other way (investing into Europe) also faces applicants with payments in some of the strongest currencies in the world, something that compounds matters. As for the speed of processing citizenship, South American countries typically beat European destinations, but all countries that offer CBI, ensure a reasonably rapid turnaround time as it is recognised that delays in administration would thwart such programmes and discourage investment. European countries generally have a longer timeframe in play for full and complete citizenship, however.
Where political stability is paramount, both for the conduct of business and a trouble-free retirement, Europe is definitely at the forefront. For those jaded by the ages of Europe and sporting a slightly higher risk appetite, South America offers a dynamism hard to emulate in more established markets. Typically deemed emerging markets, however, investors need to be completely au fait with such market potentials. Recent Venezuelan hyperinflation, for example, has had an unavoidable impact on neighbouring countries.
Not all of them have been bad, of course, and there are always peripheral commercial opportunities in crisis, but conducting business in Latin America requires skilful and quick manoeuvring and a hefty insurance bill for the more risk-averse. It is a falsehood, however, to lump all Latin American countries into the ‘high risk’ bag, and for those seeking opportunity in business as an essential determinant, Latin America often far outpaces Europe precisely because of its emerging market potential.
The cost of offered CBI, the speed with which one can glean actual citizenship, as well as potential of future commerce or peace and prosperity, are key factors that govern a country’s attractiveness as a destination to settle for work or retirement. The nature of business will frequently determine viable destinations and personal preferences around lifestyle also come into play.
The northern hemisphere is typically significantly colder in winter, while southern countries enjoy protracted and sunny summers with very mild winters. Personal preferences will of course determine which of these factors guide an investor’s choice, but all CBI programmes the world over are typically welcoming and facilitating. The bar has been set and competition in 2020 is fierce. EG