The options for obtaining secondary citizenship have expanded significantly in recent decades, providing individuals and families with new opportunities for global mobility, economic security and legacy benefits.
From modest beginnings in small island states, citizenship by investment (CBI) programs have grown into a worldwide industry with diverse opportunities for acquiring citizenship in a foreign country through economic contributions. These programs play a growing role in global economics and trade, offering countries a means to attract foreign capital and individuals a pathway to diversify their citizenship portfolio.
For successful applicants, CBI programs increasingly demand expertise, meticulous application preparation and staying updated with evolving program information for success. It can be helpful to review the origins and recent developments of economic citizenship to understand CBI programs and plan for how they may evolve in the year ahead.
The birth and expansion of CBI
Economic citizenship programs emerged in Pacific Island microstates, with some of the first programs arising as clandestine or unofficial revenue sources for the microstate governments. Based on my observations, official CBI policies first took root in the Caribbean in the early 1980s. Dominica was an early adopter of granting economic citizenship, recognizing the benefits investment immigration could bring to its economy. St. Kitts and Nevis introduced the first codified CBI program in 1984, one year after gaining its independence from the United Kingdom, setting a precedent for other nations by including CBI in its 1984 Citizenship Act.
The success of Caribbean CBI programs led to their adoption in other regions. In 1986, Canada introduced its Immigrant Investor Program (IIP), marking the beginning of residency by investment programs. The United States followed suit with the EB-5 Immigrant Investor Program in 1990, and similar programs were later established in Australia, New Zealand, the United Kingdom and the European Union.
Political and economic factors driving the evolution of CBI
Several overarching factors have driven the growing interest in CBI programs:
- Political and economic instability. Some individuals from unstable regions have sought the stability and security offered by secondary citizenship.
- Global mobility. Since the inception of CBI, the desire for visa-free travel and the ability to move freely across borders has driven demand for secondary citizenship.
- Unstable governments. Families looking for a secure and stable environment often turn to CBI programs as a plan B.
While CBI programs have consistently been in demand due to the need for global mobility and security, certain events have historically created a spike in interest in CBI programs:
- Election cycles. Demand often rises during election periods, particularly in U.S. presidential elections. The 2020 election period, for example, saw a notable increase in demand for secondary citizenship as a plan B.
- Geopolitical catalysts. Events such as Brexit (2016), the Hong Kong protests (2019-2020), ongoing conflicts in the Middle East (Syria, Iraq, Yemen), Turkey’s earthquake and election cycles, and the Ukraine conflict have all caused some transient-increased demand for CBI programs.
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Initially, CBI programs primarily attracted high-net-worth individuals seeking visa-free travel and increased global mobility. Today, the appeal of overseas CBI programs has broadened. More individuals are seeking secondary citizenship for personal or business security, political stability and economic opportunity. The motivations have diversified beyond just travel benefits. As the demographics, motivations and political environments have evolved, CBI programs have broadened to cater to a wider array of applicants. Some of the different types of investment immigration programs available today include:
- Residency by investment (RBI). RBI programs allow individuals to obtain residency status in a foreign country through significant economic contributions. These programs are often seen as a step toward full citizenship. Countries such as Portugal, Spain and Greece offer popular RBI programs, often referred to as "Golden Visa" programs, which grant residency in exchange for real estate investments, job creation or government bonds.
- Citizenship by ancestry. Some countries offer citizenship based on ancestry or descent. Individuals who can prove that their parents, grandparents or even great-grandparents were citizens of a particular country may be eligible for citizenship. This type of program is prevalent in countries that have experienced a broad dispersion of emigrants, such as Italy and Ireland.
- Retirement programs. Designed for retirees seeking a peaceful and stable environment or a new adventure, these programs offer residency or citizenship to individuals who can demonstrate a steady income or substantial savings. Countries like Panama, Malaysia and Portugal have retirement programs that attract retirees abroad with favorable tax regimes, lower cost of living and high quality of life.
Program expansions have made investment immigration accessible to a broader audience, each catering to specific needs and circumstances. The breadth of new opportunities and the intricate nature of CBI programs have also increased the importance of expert guidance. Modern advancements have streamlined the application processes for CBI programs. However, those advancements have also enabled more rapid changes in program benefits and regulations. Legal professionals now play a pivotal role in preparing and reviewing applications, ensuring compliance and providing expert consultation to facilitate smoother approvals.
Looking forward: Future of CBI programs
As CBI programs continue to evolve, several trends are expected to shape their future:
- Environmental and climate concerns. With increased awareness of climate change effects, along with increased regulatory efforts to combat it, there will likely be growing emphasis on CBI programs that help address environmental and climate-related issues. By incentivizing immigration through sustainable investment requirements, governments can contribute to the aim of reducing carbon emissions and transitioning to more environmentally friendly economies.
- Diversification of investment options. Investment options will diversify to compete for and attract a broader range of talent and achieve specific economic goals.
- Appeal to remote workers. The growing trend of remote work will make CBI programs more attractive to individuals seeking flexible living arrangements across borders.
The evolution of CBI programs has reflected changing global trends and the diverse needs of individuals seeking secondary citizenship. As global political and economic systems face new challenges, new opportunities will arise. CBI and related programs will continue to play a pivotal role in meeting the demand for global mobility and economic strategies.
