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Sun 29 Sep 2019 01:41 PM

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Around the world in 13 passports: Why second citizenship is on the rise

Almost a third of respondents to a global online survey revealed they have acquired citizenship of a country other than their country of origin, or plan to do so

Around the world in 13 passports: Why second citizenship is on the rise
About 30 countries are now offering residency or citizenship by investment (CBI) programmes.

High Net Worth Individuals (HNWIs) are increasingly buying up second passports in safe havens, citing concerns about growing regional political tensions.

Nearly one third (33 percent) of respondents to a global online survey by Arton Capital said they have acquired citizenship of a country other than their country of origin, or plan to do so.

“Rich people are seeking the assurance of mobility in a world where fraught international politics and climate change are making people nervous,” said Armand Arton, founder of Arton Capital, a Canadian firm that specialises in global residency and citizenship investor programmes with offices in Dubai.

“We are seeing a large increase in second citizenship applications, particularly from the Middle East and Hong Kong where political instability has been growing,” he said.

Of the 410 HNWIs surveyed, 90 percent of respondents have investable assets of $1m- 5m; a further 10 percent have investable assets of $6m-10m.

The survey, conducted in August 2019, addressed HNWIs in the ten countries that are most significant in terms of international migration flows: Canada, China, Germany, India, Russia, Saudi Arabia, Spain, the UAE, the UK and the US.

Mass migration

About 30 countries are now offering residency or citizenship by investment (CBI) programmes, which usually involve investors making social impact economic contributions, investing in special government bonds, education funds or purchasing properties that create jobs in high unemployment areas.

In return, they can gain freedom of movement, visa-free access to coveted foreign markets, or safe havens from conflicts in their own country.

In 2018 alone, approximately 108,000 HNWIs migrated from their home countries – an increase from 95,000 the previous year – according to the 2019 Global Wealth Migration Review released by data consultancy New World Wealth in April.

According to the report, China has the highest number of HNWIs picking up second passports. The country experienced an outflow of around 15,000 HNWIs, which represents about two percent of the total population of HNWIs in the country. 

Other countries with significant outflows of HNWIs include the Russian Federation, Turkey and France.

Incoming residents

With a net inflow of 12,000 HNWIs, Australia took the top spot for the most popular destination for millionaire migration in 2018, a gain of three percent on 2017.

The UAE came in sixth place with a net inflow of 2,000 in 2018, an increase of two percent annually.

Islands in the Caribbean also saw a net inflow of 2,000 HNWIs in 2018 – an increase of three percent year-on-year.

Safe havens

Geopolitical conflict is always the first ‘push factor for a plan B’ and instability makes people nervous, said Arton.

The Arton Capital founder said his firm has seen increased demand for migration into Europe, Canada and the US – which are perceived as first choice destinations for global citizens.

The most popular countries for relocation also offer the most global access, he said, particularly across the Schengen region.

Becoming a global citizen and overcoming the restrictions of nationality at birth through second residence or citizenships is a growing trend.

Arton predicts that more countries will utilise CBI programmes as a way to attract foreign impact investment amid financially straitened times.

“Every year at least three or four countries are announcing CBI programmes – that’s about 20 percent up year-on-year,” he said.

Arton Capital recently updated its proprietary Arton Index, which measures how appealing global residence and citizenship programmes are to HNWIs via the categories of speed, cost and simplicity, as well as the general categories of quality of life and global mobility.

AROUND THE WORLD IN 13 PASSPORTS

Caribbean countries

ANTIGUA AND BARBUDA

OPTION 1: $400,000 invested in an approved real-estate project.

OPTION 2: $100,000 in National Development Fund.

OPTION 3: $1.5m invested in a business.

FEES: $50,000 each for main applicant, spouse and any dependent over 18; $25,000 for dependents under 18.

BENEFIT: Citizenship; visa-free access to 132 countries.

Arton Index score: 74

DOMINICA

OPTION 1: Invest $100,000 in Economic Diversification Fund, plus additional $75,000 for spouse, $25,000 for up to two children.

OPTION 2: Invest $200,000 in real estate. Property can be sold after three years if the intended buyer is a CBI applicant. Applicant must have a face-to-face interview.

FEES: $50,000 for main applicant, $25,000 for spouse.

BENEFITS: Citizenship; visa-free access to 91 countries; quick processing (3-6 months); no residency requirement; no mandatory interview; no physical residence requirement.

Arton Index score: 78

SAINT KITTS AND NEVIS

OPTION 1: Invest $200,000 in real estate, which must be held for five years.

OPTION 2: Contribute $150,000 into the Sustainable Development Fund

BENEFIT: Citizenship; visa-free access to 132 countries; no residency requirement.

Arton Index score: 67.

SAINT LUCIA

OPTION 1: Invest $100,000 in the Saint Lucia National Economic Fund.

OPTION 2: $500,000 in government bonds. Investment must be held for at least five years.

OPTION 3: $300,000 in an approved real estate. Must be held for at least five years.

OPTION 4: $3.5m in a new business that creates at least three jobs. Applicants must have a net worth of $300,000.

BENEFIT: Citizenship; visa-free access to more than 100 countries

Arton Index score: 71

Europe

BRITAIN

OPTION 1: Invest £2m to live in Britain for a maximum of three years. £5m gets you citizenship after three years, £10m after two years.

BENEFITS: Access to citizenship

Arton Index score: 55

CYPRUS

CITIZENSHIP: Investment of €2m during the three years preceding the date of the application; must retain the said investments for at least three years from date of the naturalisation.

RESIDENCE: Purchase property of at least €500,000; then make two €75,000 donations – one to the Research and Innovation Foundation and one to the Cyprus Land Development Corporation.

BENEFITS: Citizenship; visa-free access to 159 countries; dual citizenship allowed.

Arton Index score: 72

GREECE

After seeing application volumes for its golden visa nearly triple in just two years, Greece now grants more investor visas than any other country. Greece asks for €250,000, typically spent acquiring real estate which remains historically cheap in Greece.

OPTION 1: Greece offers residence to foreign investors placing €800,000 in Greek government bonds

OPTION 2: Greece also offers residence to investors who place €400,000 in bonds or shares of real estate investment companies.

BENEFITS: Greece is a member of both the EU and Schengen, which means a residence permit in the country comes with visa-free travel throughout Europe, and also that continued residence in the country for a number of years could lead to EU citizenship.

Arton Index score: N/A

MALTA 

CITIZENSHIP: Invest €350,000 in property, €150,000 in government-approved financial instruments and donate €650,000 to the National Development and Social Fund.

RESIDENCE OPTION 1: Invest €320,000 in property and €250,000 in government bonds. Fee of €30,000.

RESIDENCE OPTION 2: Invest €275,000 in property and pay €15,000 annually. Annual income of €100,000 or possession of capital of €500,000 required.

BENEFIT: Citizenship; visa-free access to 168 countries.

Arton Index score: N/A

PORTUGAL

OPTION 1: Invest €500,000 in property, or €350,000 in research, or €250,000 in the arts, or €500,000 in venture capital, or create a minimum of ten jobs.

BENEFITS: Residency with a stay of only seven days in the first year; access to citizenship after five years; the right to free entry to the 26 Schengen countries; includes immediate family members. Portugal offers a safe and good quality-of-life.

Arton Index score: 55

MONTENEGRO

OPTION 1: Officially opened in October 2018, the Montenegro CBI programme offer individuals several options in terms of investment, including a €450,000 investment in projects in developed areas or a €250,000 investment in projects in less developed areas. The government also charges a fee of €100,000 per application.

BENEFITS: Cost-effective pricing and immediate residency; the country is due to enter the EU from 2025.

Arton Index score: 69

North America

THE US

EB-5 VISA: $1m investment in a business, or $500,000 in a high-unemployment or rural area. Company must create or preserve at least ten full-time jobs.

BENEFITS: Residency; access to US citizenship after five years.

Arton Index score: 56

QUEBEC

OPTION 1: C$2m in a risky investment for 15 years. Applicants must be worth C$10m.

OPTION 2: C$800,000 in a passive investment for five years. Applicants must be worth C$1.6m.  

BENEFIT: Access to citizenship after four years.

Arton Index score: 67

Asia Pacific

AUSTRALIA

OPTION 1: Invest A$1.5m in a designated investment.

OPTION 2: Retiree applicants aged 55-plus with A$750,000 of assets, plus income of A$65,000 a year and no dependents, must make a designated investment of A$750,000.

BENEFIT: Access to citizenship after four years.

Arton Index score: N/A

Sources: Professional Wealth Management; Arton Capital

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