Tied for first place in the race for the world’s most powerful passports, Singapore and Japan each have visa-free or visa-on-arrival access to 190 countries. Across the globe, other nations aren’t quite so lucky and have to go old school and patiently apply and pay for visas, hoping that their life’s credentials are enough to get them the official stamp.
Those whose pockets are full, however, are in a different category of their own. They don’t apply for tourist visas—they purchase residency.
Amidst the clamour and uncertainty of Brexit, British citizens are rushing to claim Irish passports, a lifeline in case it all turns ugly. But political unrest is not the only reason to change or add to your citizenship.
For wealthy travellers who want to enjoy a freer route around the globe and have access to more powerful passports, countries offer citizenship by investment programs (CIPs), which entails investing in a country’s economy, usually in infrastructure development or government bonds, as a pathway to obtaining their citizenship.
Unsurprisingly, the booming industry is a controversial one as it clearly favours the fortunate. Citizenship doesn’t come cheap, as I’m sure you’ve already surmised.
Nations offering CIPs require clients to invest in their continued development and growth. Nuri Katz, founder of international financial advisory firm Apex Capital Partners, told CNN that CIPs are generally bought up by wealthy individuals whose home passports limit their travel plans.
Katz noted that many CIP applicants come from regions like Russia, China and the Middle East and are worth an average of US$8 million (S$11 million).
These programs are not a new concept, although it has only recently become a trend.
St. Kitts and Nevis, this year holding the world’s 24th most powerful passport, with visa-free and visa-on-arrival access to 154 countries, started the first CIP.
The two-island nation in the Caribbean has been using its passport as a lure for foreign direct investment since 1984, and many other countries in the region followed suit.
Katz noted that countries like Austria, Antigua and Barbuda, Malta, Cyprus and Dominica are actively pushing their own versions of CIPs, and more developed nations like the United States, Canada, the United Kingdom and a few other European countries have also made them available to foreign clients.
According to Katz, Georgia and Kazakhstan are in the midst of creating their own programs, while several other Balkan countries are considering doing the same.
Before their applications are approved, applicants to CIPs will undergo strict and thorough financial and criminal evaluations into their person and to ensure that their money has been legally earned.
Katz remarked that the approval process is a length one, taking several years to complete. For example, the US CIP program requires applicants to live a full five years in the country as a residence requirement before being eligible to apply for citizenship.
There’s a reason only a certain percentage of the population can afford to purchase citizenship—CIPs do not come cheap. They range from US$100,000 (S$136,000) in the island of Dominica to a minimum of US$2.15 million (S$3.41) in Cyprus, which relies heavily on its European passport and status and is known for quick processing times and generally smooth and stress-free documentation.
Katz noted that some extremely wealthy clients even collect passports as status symbols of the most elite kind.
“It shows that one has reached a certain financial level that allows them to invest in a second citizenship,” said Katz. “Like buying an expensive car, it serves a purpose but it also shows that one can afford it.”
Interestingly, Katz remarked that collecting passports is more of a millionaires-only club. The billionaires will have long taken care of these issues.
The little Mediterranean nation along the Adriatic Sea is offering only 2,000 openings. To snag a spot, would-be citizens of Montenegro will have to invest in a minimum investment of US$274,000 (S$374,000) in projects in underdeveloped areas and pay a fee of €100,000 (S$151,000) for each application.
With citizenship in different nations up for grabs, the world’s doors are opening even more. Well, for the wealthy, at least. The rest of us will still wait in line at immigration patiently. -/TISG