The Magnetism of a Second Passport: Citizenship by Investment Programs are on the Global Rise

Citizenship by investment industry is booming right now. 

Every year, the demand for having a second passport continuously increases by 23 percent, and a total investment migration market size reached $21,4 billion in 2020. 

The concept of citizenship by investment (CBI) began in 1984 when St. Kitts and Nevis — a two-island nation in the Caribbean — introduced it to the world. Now it’s the longest-running CBI program and is considered to be ‘the platinum standard’ of CBI programs. 

Fast forward to 2020, there are 16 citizenship by investment schemes running worldwide, and more countries are expected to join the list soon. China, Russia, India, Vietnam, Mexico, Brazil, Turkey, the Middle East — the majority of CBI investors come from these countries, but there’s a growing demand for CBI programs worldwide.

The basic idea behind the CBI program looks pretty easy: investing or donating a certain amount of money in a country in an exchange for a passport in a relatively short amount of time. 

The investment cost can range from $100 thousand to $2,150 million, and it can include everything from non-refundable cash donations to investments in real estate, business, or government bonds. 

From a business perspective, second citizenship allows to be exempt from tourist visas for several countries, opens up new markets and helps to increase business opportunities, at the same time providing much better tax terms, while fully complying with international laws. 

Today, the second passport has become a must-have accessory for many successful businessmen, investors, and multimillionaires. 

Usually, such high-net-worth (HNW) individuals have a great deal of income at their disposal but are not able to put it to effective use within their home country. 

Nuri Katz, founder of the international financial advisory firm Apex Capital Partners, noted that “Generally, CBI programs draw individuals from countries whose passports offer very limited abilities to travel, such as China, Russia, and Middle East countries. Most of the individuals making these types of investments are high-net-worth entrepreneurs with net worths of about 2 to $15 million.“

During the last few years, Egypt, Jordan, Moldova and Montenegro joined the CBI program’s list, which also includes Cyprus, Bulgaria, Malta, and other countries that offer individuals the opportunity to live, work and register their businesses in various jurisdictions. 

Each government has different requirements for applicants, and everyone interested in CBI options should spend some time on analysis, as every country in the program has some unique outline.

For example, St. Lucia and Cyprus are the only countries offering CBI passports through Government bonds and treasury bills, while St. Kitts is the only country that offers Accelerated Application Process within 60 days for an additional fee. 

Cyprus CBI scheme is limited to 700 applications per year, while Western Samoa and Bulgaria passports have visa-free travel to Canada option. 

Antigua is the only country that accepts bitcoin and other cryptocurrencies for payment,  whereas Malta and Austria are the only countries that have the Visa Waiver Program with the US. 

Hoping to make it all much simpler for the HNW individuals and investors, James McKay, a research analyst and consultant with more than a decade’s experience in the implementation and execution of complex research and data analysis projects, developed the CBI Index.

This first-ever up-to-date guide provides accurate data on all citizenship by investment programs around the world and measures such important areas like due diligence, freedom of movement, ease of processing, mandatory travel or residence, etc. 

Newest CBI Index rankings showed that the Caribbean Islands CBI programs have reached an all-time highest ranking with their popularity, crowning Dominica as the most attractive program on the market for the third year in a row. 

St. Kitts and Nevis took second place, leaving Grenada in the third. Close behind — St. Lucia, the newest member of the Caribbean CBI program, followed by Antigua and Barbuda. 

Investors from all around the world — especially from China, Russia, the Middle East, and Africa — really like the concept of acquiring the second passport here, one of the top reasons being

its accessibility and much cheaper price. 

Speaking about the cost, we have an interesting example for you right here. 

Moldova’s CBI program with the requirement of a $100 thousand one time contribution with processing time 3 months, is the cheapest CBI program in Europe. 

The same minimum entry threshold number goes for the Caribbean programs. And this fact, along with the warm climate, low investment requirements, and undemanding residency obligations have definitely helped Caribbean CBI programs take the first 5 places in the CBI Index list. 

But there’s more. 

Caribbean countries don’t impose most of the taxes we are used to, investors can forget about all the visa-induced problems, as the second passport here also unlocks borders of more than 100 countries, including Schengen and the UK, application processes are handled quickly and easily, and takes max from 3 to 5 months. There are no residency requirements for retaining the status, and Caribbean countries take confidentiality really seriously, as no information about the

applicants to any third party is revealed. 

But perhaps the biggest and most important reason why people like Caribbean CBI programs is the fact that they are not so strict, especially when compared to EU CBI programs.

Cyprus was winner citizenship by investment program in the European category for the second year in a row, reaching the 7th place in the overall CBI Index ranking. 

Launched in 2013, it is the biggest citizenship scheme in the EU: almost 4000 foreigners from Asia, Europe, and Arab countries obtained a second passport here in the period from 2014 to 2018. 

Political stability, high standard of living, low crime rates, no restrictions on applicants from any country, visa-free travel to 173 countries, including the UK, EU member states, Canada, Singapore, excellent education and health care system, favorable tax regime to residents, particularly to high net worth individuals — Cyprus is a really attractive choice. 

However, this CBI program is quite expensive, especially when compared to the Caribbean, as a single applicant minimum outlay equals €2,150 million (about $2,52 million) here.

With uncertainties caused by Brexit, Cyprus CBI has also become one of the top choices for British citizens who are looking for new ways to keep their European citizenship.

According to BBC, the number of Britons granted citizenship of another EU country increased by 159 percent in the year after the referendum.

A few years ago, CS Global Partners conducted a survey in the UK between the ages of 18 and 50 about the importance of second citizenship. Results were interesting: 89 percent said that they would like to own a second passport, and they’re willing to pay more for it than they spend on a monthly rent. Over 34 percent said they had looked into investing in a second citizenship, with over 58 percent naming Brexit as the main reason for doing so. 

A decade ago, having a second passport and dual citizenship was a rare case. 

Nowadays it has become popular to own two, three, or even more passports, and citizenship by investment programs can provide that quite easily. 

Besides 16 current CBI programs, many countries around the world are thinking about joining the list. Greece, Albania, Kenya, Mauritius are all working on creating their own programs, and several other countries in Balkans are considering them as well.

Interest in CBI is enormous now and has especially accelerated in recent years, thanks to a combination of cuts in prices to the Caribbean CBI programs, visa-free travel, ease of doing business in a foreign country, and friendly tax regimes.