In a volatile, uncertain, complex and ambiguous (VUCA) world, getting a second passport has become a priority for many high-net-worth-individuals (HNWIs) looking to ensure financial security and global mobility as well as hedge against geopolitical risks.
The pandemic-fuelled trend of flight cancellations, border shutdowns and other mobility restrictions has been a wake-up call for many individuals to improve their preparedness for a disruptive future, driving them to explore the benefits of strategic residence and citizenship planning.
Top immigration and citizenship consultancy companies in the UAE have noticed a spike in enquiries for second passports, citizenship and residency schemes since the outbreak of the pandemic.
According to their forecast, the sector will continue to grow rapidly in the near future, partly accelerated by the fallout of the Russia-Ukraine conflict.
“The demand and supply for second citizenship by investment will continue to see growth in the future,” says David Regueiro, COO of RIF Trust and VC of Latitude.
“For clients, socio-economic and political pressures in their home country coupled with health concerns with the pandemic, are the core drivers for HNWIs and UHNWIs to seek out a second citizenship to ensure they have the perfect plan B insurance policy for their family to travel and relocate easily.”
The demand and supply for second citizenship by investment will continue to see growth in the future.
Regueiro adds, “Governments around the world are stepping up to meet this demand with new investment migration programmes in the coming years to attract foreign investors, both active and passive, and offset their deficits from Covid-19.”
The investment migration market was estimated at $21.4 billion (Dh78.59 billion) in 2019, with projections suggesting it will reach $100 billion in revenue by 2025 if the 23 per cent growth trend persists, according to Investment Migration Insider, a knowledge platform for the industry.
“Second citizenship is not a luxury anymore – today it is important to secure the family’s future and have a plan B, as it’s difficult to predict what lies ahead,” says Tony Ebraheem, Founder and Lawyer, 111 Immigration.
Technology, driving change in almost every major sector, can also be effectively used to streamline operations in the immigration and second citizenship sector.
Sensing growth opportunities, countries offering citizenship and residency by investment programmes (CBI and RBI) have initiated several measures to make the process more transparent, efficient, reliable and fast, while consultancy companies in the immigration sector have accelerated their adoption of digital technologies to fuel the new wave of growth.
“Flexibility and technology are the key drivers of growth in the sector. Covid taught us how important it is to be flexible when it comes to strategic planning to achieve our goals. Technology, driving change in almost every major sector, can also be effectively used to streamline operations in the immigration and second citizenship sector,” says Ebraheem.
Updates in Portugal Golden Visa
Portugal offers one of the most competitive investment migration programmes in the European Union, and its Golden Visa programme has been gaining traction globally.
Passports for just traveling are not enough these days. Demand for the Portuguese programme will remain a long-term trend in the RBI segment.
“Demand for CBI and RBI programmes has risen since the pandemic struck, which created instability, unemployment and social conflict. People more than ever needed the freedom to move and they also needed a backup plan for themselves and family members,” says Tiago Camara, Partner, PTGoldenVisa, which specialises in the Portugal Golden Visa.
“Passports for just traveling are not enough these days. Demand for the Portuguese programme will remain a long-term trend in the RBI segment.”
There are several investment options for Portugal’s Golden Visa, but the most common route to obtain the right to live, work and study is through purchasing real estate.
This year, the Portuguese government has introduced various new measures to redirect investments to the country’s interior regions.
“Since January 1, 2022, residential properties can be bought only in designated interior areas of Portugal and Islands. However, in high density areas, it is still possible to invest in commercial properties,” says Camara. PTGoldenVisa currently offers projects throughout Portugal, covering all categories of investment.
“Clients of the Golden Visa programme can also qualify with an investment in a closed mutual fund, with a minimum investment of €500.000,” Camara says. “We have a team to analyse several investment funds in the market that qualify for the Portuguese residency programme,” he adds.
The global health crisis has also generated intense interest in investment migration programmes to the UK and US, and the CBI programmes in the Caribbean islands, which greatly expand business and travel opportunities for investors.
St Kitts and Nevis’ citizenship programme, launched in 1984, remains a popular option for investors from the Middle East, says Ebraheem.
There are several ways to secure a second passport — an applicant can invest in an approved real estate, contribute to a sustainable growth fund and invest in a government-approved project.
However, real estate remains the preferred route for many investors.
“Before investing in a programme, investors must ensure that it fits their requirements, future goals and aspiration,” Ebraheem advises.
Despite sustained demand for CBI programmes, the sector was hit earlier this year by EU’s decision to partially suspend the visa waiver agreement with Vanuatu due to concerns over its investor migration scheme.
If you are considering a second residence or citizenship, you should move forward as quickly as you can.
This agreement, applied between the EU and Vanuatu since 2015, allows citizens of Vanuatu to travel to the EU without a visa for stays of up to 90 days in any 180-day period.
“While this is due to take effect next month, the Vanuatu government has established a national task force to obtain a reversal on the EU’s decision,” says John D Hanafin, Founder and CEO, Huriya Private.
“In any event, many citizenship programmes only run for a certain number of years before fulfilling their quota and then closing them down. If you are considering a second residence or citizenship, you should move forward as quickly as you can,” suggests Hanafin.
“As tourism is now a struggling market after the Covid-19 pandemic, CBI programmes are now geared towards rebuilding the economies of the small Caribbean countries where their main industries have been affected.
“Although there will be many challenges ahead, the growth areas for these countries will be infrastructure and building back the tourism industry, while maintaining a strong and vibrant economy through issuing citizenships. Enhanced vetting procedures imposed by Europe and the US create better transparency in the citizenship by investment sector,” says Farooq.
“As tourism is now a struggling market after the Covid-19 pandemic, CBI programmes are now geared towards rebuilding the economies of the small Caribbean countries where their main industries have been affected."
Buying real estate for citizenship and residency
“Investment in real estate for citizenship is without a doubt the best route as it makes the application virtually free considering the returns and the capital appreciation,” says Michael Waechter, Director, Abode Options.
“Clients are spoilt for choice with the number of options available for real estate purchase. An investment in fractional ownership in resorts in Portugal and Dominica is a great choice. Not only is the investment secure but client enjoys great returns as well.”