Economic Citizenship by Investment Programs
Countries have their own set of rules that govern their respective citizenship by investment programs. The biggest benefit of obtaining a second citizenship is that one can travel to most places in the world without a visa. For example, if a person becomes a citizen of Malta, a Southern European island country, they can freely visit 165 countries without a visa. This is because Malta is a member of the Commonwealth as well as the European Union.
Economic citizenships have gained in popularity considerably and allow individuals who wish to become a citizen of another country or wants to have a second passport to do so by contributing to the economy of that country by way of investments.
Ways Of Obtaining A Second Passport
- Citizenship by descent: Those who have parents, grandparents or even great grandparents from a different country, can apply for the citizenship of that country.
- Citizenship by residency: It becomes easier to possess a second passport for those who have qualified to become a resident of that country.
- Citizenship by investment: Economic citizenship programs allow people to obtain citizenship by making investments in the country.
- Other means: It is also possible to get a second passport by marrying a foreigner, being adopted by a foreigner, etc.
Why Opt For Economic Citizenship By Investment
The obvious benefit that one can get from economic citizenship programs is that they become a citizen of the desired country, but there are other benefits as well:
- Improved standard of living: The applicant gets to settle down in another country permanently. This can be a good opportunity for moving towards a better-quality life and a higher standard of living.
- Traveling made easier: A second passport adds to the number of nations a person can visit without having to apply for a visa.
- Safety and security: Citizenship by investment programs provide the applicant with safer country options to move to during disturbances in the home country.
- Better education: Those applying for citizenship by investment give their children the opportunity to pursue quality education abroad.
- Tax benefits: Those obtaining a second passport through economic citizenship programs will be entitled to all the tax benefits available to the citizens of that county.
Suitability Of Economic Citizenship Programs
Although almost everybody can benefit from a second passport, such programs are more valuable to certain people. For example, citizens who want to discontinue or renounce their original citizenship owing to reasons such as stricter tax reforms, etc. Citizenship by investment programs could also be of the utmost importance to emerging world citizens. Economic citizenship programs also benefit businessmen and high net worth individuals. It is also important to keep in mind, that while countries offering citizenship by investment programs generally accept dual citizenship, not all countries do. Therefore, it’s important to check the policies of the native country before seeking an additional citizenship.
General Requirement Of Citizenship Programs
The requirements of citizenship by investment programs vary across countries. However, most of them have the following basic requirements:
- Minimum financial investments
While each country has its limits set, most of them require the applicant to invest or agree to invest the minimum amount before the application is approved. Such minimum amount varies from country to country. While it is low for Dominica’s economic citizenship program ($100,000), it is high for the U.S. ($1,000,000USD).
- Proof of lawful sources
Since the country is offering its citizenship, it needs to be sure about the background of the investor. Thus, quite a few countries require the investor to prove the lawfulness of the sources of funds used for making investments. For this, usually, investors are asked to submit copies of their tax returns, bank statements, etc.
Investment Options For Citizenship By Investment Programs
- Citizenship by donating to the government fund
Although a donation is not an investment, it is one of the options of obtaining citizenship under economic citizenship programs. The government will grant citizenship to those who contribute to its fund. Usually, these funds are set up for spending on education, infrastructure, etc.
- Citizenship by purchasing a government-approved real estate property
Those wanting to be a citizen of a country can make a hefty real estate investment in that country. The investment is usually in government-approved real estate developmental projects. Although the investment amount is huge, it is letting the applicants have their own shelter. Moreover, they are even allowed to sell the property after a certain number of years.
- Citizenship by investing in an approved business
Not all countries want or allow this. As per this option, the applicant must invest in a government-approved businesses. This can be slightly more expensive than making a real estate investment. Also, one must be very careful in choosing their investment as a business is characterised by ups and downs.
- Citizenship by purchasing government bonds
Again, not all citizenship by investment programs have this option. Under this option, one can obtain the citizenship of a country by purchasing government bonds, usually, for a period of 5 years. Such bonds do not offer interest or any other form of returns. The money remains locked with the government for a fixed period of time.
Country-wise Economic Citizenship Programs
There are around 12 different types of citizenship by investment programs in the world. Out of these, five operate in the Caribbean, four in Europe and the remaining are spread across the world. Below are the estimated costs* of these programs.
*For a family of four that has two children minor children
- A) Caribbean citizenship by investment programs
Countries offering economic citizenship programs in the Caribbean are:
- Saint Lucia
- Antigua and Barbuda
- St. Kitts and Nevis
Saint Lucia Citizenship Program
Saint Lucia, an island nation in the Caribbean, is known for its volcanic beaches and reef-diving sites. The sovereign island country also boasts of luxury resorts and fishing villages.
The passport holders of this country can travel to 130 countries without a visa. These include the Schengen area and the UK. To hold this beneficial passport, one can make a donation to their National Economic Fund (NEF). This is the cheapest option of getting the passport of Saint Lucia. It would cost around $109,500 to a single applicant. A family of four will have to spend about $207,500.
The real estate investment route for obtaining citizenship in Saint Lucia requires a minimum investment of $300,000. Also, these investments are limited to branded hotels, resorts and boutique properties. The other option of getting a second passport in Saint Lucia is investing in government bonds. The government locks the money for 5 years without paying any interest. This option would cost approximately $617,500.
Antigua and Barbuda Citizenship Program
Antigua and Barbuda is an independent Commonwealth country in the Caribbean that consists of two main islands (Antigua and Barbuda) and a few smaller islands. It’s famous for its reef-lined beaches.
Getting a passport of this country means visa-free travel to 140 countries, including the Schengen area, the UK and Brazil. Just like Saint Lucia, the cheapest option of getting a passport of this country is by contributing to the country’s National Economic Fund by way of donations. This would cost $100,000 excluding the processing fees.
Applicants can also obtain the citizenship of this Caribbean country through real estate and business investments. A government-approved property would cost a minimum of $400,000 with fees costing around $65,000. There is a possibility of exchanging this property for another government-approved property provided the applicant holds the first property for 5 years.
Another way of obtaining a second passport in Antigua and Barbuda is by investing in government approved business projects. Some of the business projects under this category are Antigua Sustainable Aquaculture Limited, Call Centre Services Inc., Caribbean Free Trade Zone Development (Antigua) Inc, Diamond Caribbean Properties Limited and Freetown Hotel Development Limited.
Dominica Citizenship Program
Dominica is a mountainous island country that has natural hot springs and tropical rainforest with the capital, Roseau, boasting of botanic gardens.
This Caribbean country allows visa-free access to 122 countries such as Switzerland, Russia, India, South Korea, Turkey, Singapore, etc. To hold Dominica’s passport through the real estate investment route, one must purchase a property worth $200,000. With government and other fees, the cost goes up to $212,500 for a single applicant and $247,500 for a family of four. It is to be noted that in order to qualify for citizenship, the applicant must hold the property for 3 years from the date of grant of citizenship.
Another option for obtaining citizenship by investment in this county is by donating money to their Economic Diversification Fund (EDF). The donation for a family of four goes up to $200,000 without fees.
St. Kitts and Nevis Citizenship Program
St. Kitts and Nevis is a dual-island nation that lies between the Caribbean Sea and the Atlantic Ocean. It’s cloud-shrouded mountains and beaches make it a famous island country.
Its economic citizenship program was launched in 1984 and is one of the most reputed ones. It allows visa-free access to 141 countries, higher than any of the Caribbean countries mentioned above. The real estate investment for citizenship would cost the entire family about $535,000. Such investments are made in hotels, villas, condominium units, etc.
Those looking to get into the country through donations can contribute to their Sugar Industry Diversification Fund (SIDF). In 2017, a temporary fund, the Hurricane Relief Fund, was created. Later, it was decided to make this a permanent fund called the Sustainable Growth Fund. For making donations, a single applicant would need $157,500 and a family of four would need $210,500.
Grenada Citizenship Program
Known as the ‘Island of Spice’, Grenada is a country in the Caribbean Sea which is famous for its nutmeg and mace crop production.
With Grenada’s passport, travel is possible to 131 countries without a visa. This includes Schengen countries, the United Kingdom, Brazil and even China. Investors can obtain the citizenship of Grenada either by donating to their National Transformation Fund (NTF) or by investing in the country’s real estate.
For donating to the NTF, the family will have to spend about $224,000. A single applicant, on the other hand, will have to pay around $150,000 with fees costing an additional $8,000. For real estate investment in Grenada, applicants will have to spend about $350,000 and another $70,000 for government, application and other fees.
- B) European Citizenship By Investment Programs
Countries offering economic citizenship programs in Europe are:
Malta Citizenship Program
Malta, lying in the Mediterranean Sea, is a small island country that is known for its warm climate and historic sites.
A Maltese passport allows travel without a visa to 173 countries and is the first European Union-approved citizenship by investment program. The applicant will have to make a contribution of €650,000 to Malta’s National Development & Social Fund with an extra charge of €25,000 for a spouse and each minor child. There has to be a real estate property purchase of €350,000. Moreover, there has to be an investment of at least €150,000 in stocks, bonds and other government-approved financial instruments. To be a citizen, one must first be a resident of Malta for about a year.
Cyprus Citizenship Program
Cyprus is the third largest as well as the third most populous island country in the Mediterranean.
With a Cypriot passport, travel is possible to 163 countries without a visa. To get a passport of this country, applicants can invest in real estate, own a business which has at least five employees as citizens, own bonds or securities of any Cypriot business that has a license granted by the Securities and Exchange Commission, etc. A combination of these investments is also acceptable. Regardless of the choice that the applicant makes, there has to be a purchase of a residence worth €500,000. Unlike Malta, one does not have to complete a residency period to obtain citizenship.
Bulgaria Citizenship Program
Bulgaria is a country in the Balkans known for its natural beauty and boasts of mountains, plains, seas, rivers, lakes and even a small dessert.
The economic citizenship by investment program of Bulgaria grants the applicant visa-free access to 156 countries. This includes Australia, several Southeast Asian countries, Japan, etc. Just like Malta, one has to be a resident of Bulgaria first to become a Bulgarian citizen.
For obtaining residency, non-European Union citizens are required to invest about $630,000 in a government bond portfolio which will be held by the government for 5 years without paying any interest. Post approval and receipt of the investment, permanent residency is granted to the applicant. Fast track citizenship can be obtained after one year of permanent residency.
Austria Citizenship Program
Austria is a country in Central Europe, famous for its castles, palaces and buildings. Its flag is one of the oldest flags in the world.
An Austrian passport is one of the topmost valued passports, but the Austrian citizenship by investment program is also one of the most restrictive ones. It allows the passport holder to travel visa-free to 177 countries. However, the contribution to be made is also huge (around €10 million).
- C) Other Citizenship By Investment Programs
Countries offering economic citizenship programs other than those in the Caribbean and in Europe are:
Comoro Citizenship Program
Comoro is located off Africa’s east coast and is a volcanic island with a tropical and mild climate. In terms of land area, it is Africa’s third smallest country.
While it offers one of the cheapest passports in the world, it comparatively allows visa-free access to a lesser number of countries. With a passport of this county, one can travel to 52 countries without a visa. These do not include many of the developed world countries. This economic citizenship by investment program started in 2008 but did not have a positive track record. The cost for a single applicant will be around $45,000 while families seeking citizenship in Comoro will have to spend about $85,000 by way of donations.
Vanuatu Citizenship Program
Vanuatu is a nation in the South Pacific Ocean that comprises of roughly of 80 islands. It is well known for its coral reefs.
Vanuatu is yet another country that offers citizenship investment programs. There is no residency requirement and the citizenship process is among the fastest available, able to be completed in 30-60 days. The passport of this country allows one to visit 116 countries without a visa, these include the UK, Hong Kong, and Singapore. Donations required for the Vanuatu citizenship by investment program are $150,000 + fees for a single applicant and $170,000 + fees for a couple. Another benefit of being a citizen of this country is that one will not have to pay any income tax. In 2017, Vanuatu also became the first country to accept cryptocurrency payments.
Choosing The Right Citizenship
Between residency and economic citizenship, the latter is faster since it takes as little as six months. On the other hand, some residency programs have a waiting period of five years before the application for citizenship is made. However, economic citizenship programs require a considerable investment and therefore must be well thought out. Even after deciding on an economic citizenship by investment, another crucial decision is which country to apply to.
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