Situated in central London, Mayfair has played host to the world’s rich and elite for the past many decades. Located a short distance from Hyde Park, the neighborhood boasts of expansive luxury homes adorned with swimming pools and basements. With each house costing in excess of $10 million and high-end sports cars lining the street, this area has always attracted the wealthier residents of the UK.
Nowadays, this area is attracting even wealthy foreigners who have taken advantage of Britain’s investment immigration program that offers permanent residency in lieu of minimum investment of around 2 million pounds or around $3 million. While London is a preferred destination for wealthy immigrants for its high-quality lifestyle and easy access to modern facilities and amenities, there are other nations in Europe that are offering residency programs for wealthy investors from all over the world.
The list of nations offering investment immigration programs include nations like Greece and Cyprus that have hit particularly hard by the recent economic crisis. Their residence programs, called Golden visas, target wealthy immigrants from China, Russia, and other citizens of other countries who are prepared to pay money to enjoy the right to reside and, in some cases, work in Europe. For those who find the UK’s program to be a bit too expensive, there are cheaper programs like the one offered by Latvia where immigrant investors can obtain permanent residency investing not less than 250,000 Euros or around $280,000.
In lieu of investments made in the real estate sector or other sectors of the country’s economy, the immigrant investors are offered permanent residence or even citizenship with relaxed requirements with regard to residence and other rules. South European nations are relying on such investment immigration programs to prop up its crisis-ravaged economies.
Experts from law firms specializing in investment immigration have pointed out that the recent economic crisis prompted many European nations to seriously consider offering permanent residence in lieu of foreign investment. Many law firms are advising European governments in the creation of visa programs targeting wealthy investors from foreign countries. Nations are opting for customized programs that target specific investors from specific nations preferred by the governments.
The USA offers an investment residence program to around 10,000 immigrant investors and their families who are required to invest at least $1 million and simultaneously create 10 full-time jobs in the economy. Despite being preferred by governments, these investment immigration programs have their share of critics and detractors as well.
Political leaders have accused governments of demeaning national citizenship in their rush to seek investments from the world’s wealthiest individuals. Other critics have pointed out that such programs allow investors to use their wealth to leap over other immigrants who may have resided longer and contributed more to their adopted countries, or those who may have fled their homelands to escape the oppressive policies of their governments.
Canada and some other European nations have been compelled to restrict or even scrap their programs after receiving a flood of applications from wealthy investors seeking immigration. Further, many economists have raised doubts over the long-term benefits of the investments made by wealthy immigrants. There have been instances where residency permits were issued to people despite non-compliance with the minimum investment requirements. The latest nation to be hit by such a scandal was Portugal. Such scams have led to fears that investment-for-residence schemes offered by governments may be detrimental to public interest.
Politicians opposing such schemes have derisively called it as sale of citizenship through installments. Others have even suggested that such schemes are being used by criminals to shift organized crime into Europe.
Despite criticisms, governments are doing their best to attract immigrant investors who bring in millions of dollars as direct foreign investment into the country. Countries like Spain, which is staring at double digit unemployment, are trying to use Golden visa residence programs to provide a boost to their economies. European nations are particularly keen on using this option as the European economy grew by less than a percent in 2015, which is significantly lower than the 2.4% growth enjoyed by the USA.
Some nations have created programs that specifically target ultra high net worth investors. Cyprus offers immediate citizenship to those who pump in at least 2.5 million Euros or around #2.8 million into the country. A Cypriot citizen is entitled to reside and work not just in Cyprus but in all nations that form a part of the European Union. Further, Cypriot citizenship offers easier access to developed countries including the USA.
Malta offers multiple investment options including government donation, real estate, government bonds, and offers citizenship to investors bringing in at least 1.2 million Euros or $1.3 million provided such investors fulfill the residency requirement of one year.
The UK offers one of the most expensive investment immigration programs in Europe. In lieu of the $3 million investment, the investor gains the right of local residency for a period of up to five years. Investors must reside in the UK for at least six months in a year. Despite these relatively onerous conditions, the UK program is in high demand as it offers investors the right to setup their establishment in London, if they so desire, and allow their families to access top-notch facilities and amenities including education and health care. Further, the fact that the UK property market remained relatively unaffected during the recent financial crisis is also being viewed as a positive factor.
Experts point out that the UK scores over other countries due to its history, culture, and potential opportunities. For those with a smaller budget, south European programs are available at a cheaper price. Greece offers long-term residence to property investors who bring in at least 250,000 Euros or around $280,000.
Some programs, like Portugal’s Golden visa, have become very popular amongst Chinese millionaires who want alternate residence rights apart from their Chinese citizenships Setup in 2012, the Portuguese Golden visa has issued around 80% of its 1800 Golden visas to Chinese investors. Total investment into Portugal from China has exceeded $1 billion. Experts opine that the relatively lenient requirement of real estate investment of around $560,000 has made it very popular amongst investors. Investors need to spend just a week during the first year to maintain their residency status.
Residency rights along with the additional benefit of hassle-free travel throughout Europe are the primary reasons behind the steady demand for the investment immigration programs offered by European countries.
Attorney Colin Singer, Commentary
Canada recently announced its new immigrant investor program aimed at the ultra high net worth investor. The Immigrant Investor Venture Capital Pilot Program aims to raise $120-million from 60 eligible investors who must each invest 2-million for 15 years.
Canada previously dominated the mid level immigrant investor industry which it created in 1986 with the Province of Quebec. In 2014 however, after a two year pause on new applications, Canada terminated its previous program along with more than 15,000 pending applications, mostly from China some who were waiting up to 6-years to invest $800,000. Processing delays occurred from government mismanagement of the program.
Source: New York Times