While certain governments successfully fill up their budgets with proceeds from golden passport programs, the authorities elsewhere torn by internal frictions fail to start awarding citizenship to foreign investors. With the CBI news coming from Vanuatu, Central African Republic (CAR), and Jordan, recent developments in the global golden passport industry prove it remains true.
Vanuatu loses budget revenues from the CBI program after its visa-free deal with the EU was partially suspended
On March 4, the European Council announced preparatory measures to partially suspend the visa-free travel agreement with Vanuatu. The latter allowed Vanuatu passport holders, including, inter alia, the country’s economic citizens, to visit the European Schengen Area without any visa formalities. Although the interested parties hoped to avoid the subsequent disaster by initiating a bilateral dialogue, the resolution to suspend the above visa-free travel agreement came into force 2 months after it had been announced on May 4.
In its first economic report for H1 issued after the visa-free travel agreement suspension, the Vanuatu Department of Finance and Treasury (DoFT) released figures indicating a sharp decline in revenues from the Vanuatu CBI program.
The 2 Vanuatu CBI programs implemented in the country raised the total of VUV 2,070,000,000 or around USD 16,400,000. In Q2, proceeds therefrom turned out to be 34% lower YoY. The said quarterly revenue from granting Vanuatu golden passports to foreign investors appeared to be the lowest since 2018.
According to the DoFT, in H1, 2022, the VDSP (available for all applicants) and the VCP (available for applicants from mainland China) programs “together earned VUV 4,705,900,000, accounting for 48.7% of the budget target equal to VUV 9,659,600,000. This is 16.8% below the same figure YoY (VUV 5,654,200,000)”.
Although the DoFT officials recognize the important role the CBI programs have in generating government revenues within the last 5 years, they warn the importance of the said VDSP and VCP schemes in government revenue generation will decrease significantly in 2022, due to “a number of major barriers and difficulties the schemes had to face and overcome”.
The DoFT official representatives mentioned 3 major reasons behind the expected reduction in revenue from the Vanuatu CBI programs: “Termination of banking relationships in 2021, a recent suspension of the visa-free agreement with the EU, and ending the name change practice as provided for under the Registration Service Act are currently the main causes that already influence or may potentially influence the revenue generated under the like programs to a great extent”.
The DoFT officials remarked that the new Real Estate Option (REO) scheme would hardly make up for the shortfall, considering a low direct income potential therefrom. Announced earlier, the said scheme provides for granting citizenship by investment to foreign applicants, while the VDSP and VCP program participants make donations to the host country’s government.
The sagging demand resulted in a lower CBI program share (29.89%) in the total government revenues in Q2, 2022. The reduction was so drastic for the first time since 2018.
Revenues from the Vanuatu CBI programs are likely to drop further in the near future, considering the visa-free entrance to the Schengen Area was officially suspended and the suspension came into force on May 4 only, i.e., about at the half-year end. Vanuatu citizenship applications are usually processed within 2 to 3 months. This means, the way the EU sanctions influence the Vanuatu government revenues and the extent thereof will only become apparent in Q3, 2022, after the country’s quarterly financial statements have been released.
Jordan citizenship by investment granted to 239 investors since 2018
According to the Jordan Ministry of Investment and the citizenship by investment news published by local mass media, 239 investors acquired Jordan citizenship by investment since the Jordan citizenship by investment scheme was launched in 2018 till late July, 2022.
Representatives of the relevant government agency announced that certain applicants had obtained Jordan citizenship by investment by establishing deposits with the Central Bank of Jordan. Applicants for the Jordan citizenship by investment program however preferred to invest in business projects to obtain their golden passport in Jordan.
The Jordan CBI program provides for investing in several industries, including, inter alia, manufacturing, tourism, medical sector, education, power generation, and satellite broadcasting. The data provided by the officials indicate that the business projects enjoying foreign investment employ 12,757 people.
In March 2022, the Jordan Cabinet approved the decision to expand the industry list for foreign investors to channel capital to with the purpose of obtaining Jordan citizenship by investment. Adopted in March, the Jordan government decision aims to localize commercial sector investments and increase the number of jobs available for Jordan citizens.
CAR High Court rejects government CBI scheme
The High Court of the Central African Republic rejected the local government scheme allowing to grant residence permits, citizenship, lands, and valuable natural resources to investors about to channel funds in purchasing the government-supported cryptocurrency Sango Coin. The official intention documented by the above scheme was to grant Central African Republic citizenship by investment to foreign investors who purchase the country’s cryptocurrency Sango totaling USD 60,000 and above.
According to the judges, the above government’s proposal shall be ruled unconstitutional, as “citizenship has no market value”.
The official representative of Faustin-Archange Touadéra, the CAR president, revealed to Bloomberg that the CAR government was looking for different ways to grant citizenship and lands to overseas investors. CAR was the first African state and the second country globally after Salvador to have accepted bitcoin as their lawful currency. The impoverished African jurisdiction is keen to develop the country’s economy by turning it into a regional crypto hub and promoting Sango Coin.
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What countries offer economic citizenship to investors?
They are Antigua, Vanuatu, Grenada, Malta, Dominica, Turkey, Jordan, Saint Kitts and Nevis, Montenegro, Saint Lucia, and Egypt.
How much will I pay to acquire economic citizenship?
The threshold investment amount makes up USD 100,000, plus administrative charges and the immigration agent’s fee. The latter shall have a license issued by the host country’s government.
What currencies are accepted in payment for a golden passport?
The most common currency is USD, or EUR in rarer cases. Certain states welcome GBP, JPY, NZD, and AUD.
