There is an increase in wealth globally and an increase in demand for second passports from the Ultra High Net Worth Individuals (UHNWI’s) and the High Net Worth Individuals (HNWI). According to the Knight Frank report published this year, there were 198,342 UHNWIs in the world during 2018. The world total population was 7.5 billion in 2018. So, 0.003% of the world’s total population are UHNWIs.
The number of UHNWIs are expected to grow to 241,053 by 2023. The UHNWI population—defined as people who have at least US$30 million in assets. The number of (HNWI) population is growing, too. These are individuals with assets of $1 million plus excluding primary residence. The wealthy are on the move with 36% of UHNWIs carrying a second passport for citizenship or residency purposes.
So what will happen if there is war in your country? Can you passport enable you to live in the European Union, can you travel without a visa London or New York or Geneva for leisure or for business?
Is it important to have a second passport?
“Investment migration has grown and has become a $26 billion industry.” explains Marios Rafail, Head of the Geneva Office, Henley & Partners Switzerland AG. “Today, there private clients globally, including the younger generations such as entrepreneurs seeking such solutions for different reasons, for example global mobility or as a plan b if their country has politically unstable”
Henley & Partners is a global citizenship and residence advisory firm based in London. The Henley Passport Index report identified Japan as the best passport globally with visa free access to 189 countries. The best African passport is from Seychelles with access to 150 countries, visa free.
Armand Arton the Founder and CEO of Arton Capital says that the citizenship by investment business is growing due to the increase in political instability, especially in the Middle East and other developing countries. Arton Capital, specializes Investor Programs for Residence and Citizenship.The largest demand for their services is from from Mainland China which accounts for 60% of the company’s clients. This is followed by the Middle East, with 20% of the clientele. Russia and the Commonwealth of Independent States (CIS) brings 10% of the clientele and Africa also at 10% of the demand.
“There an increase of UHNWI and HNWI in developing countries who lack wide mobility. Interestingly, many private jet owners lack the passports with visa free access and they have to do the normal lengthy visa application process. A large part of the world is stopped by lack of mobility. You can also have mobility but lack relocation and citizenship,” he comments.
Holders of the African passports are familiar with the constant challenges of acquiring visas to several countries inclusive of South Africa. The visa process is often tedious and sometimes unsuccessful.
Femi Young, Founder and CEO, Total Outsourcing Solutions in Nigeria works with the Maltese government and Nigerians on Maltese citizenship by investment program.
“Having an additional passport that gives you access at anytime, is crucial especially if you are from countries that have political and economic instability. Many business people have lost huge deals due to lack of visas or visas were acquired late. These programs give you the ability to access better education for your children, global business opportunities, healthcare and leisure. It is all dependant on the needs of the client.”
Which countries offer second citizenship? This depends on the requirements of the client. According to Young, the Maltese has the leading citizenship program.
“Malta is one of the only two citizenship by investment programs in the EU (and the only one in the Schengen Area), a Maltese passport is powerful, and it provides citizenship in a highly livable area of the world with easy access to the rest of Europe,” he expounds. “It is slowly becoming more desirable in Nigeria due to the challenges of getting visas to travel internationally on a Nigerian passport. The cost of citizenship in Malta starts from USD$1m (900, 000 Euros). Malta is a member of the European Union (EU), therefore it has a powerful passport similar to the other EU members.”
The Maltese passport allows visa free access to 183 countries. Nevertheless, the Austrian citizenship by Investment program is the one which gives the most visa-free access (185 countries) confirms Rafali.
“In Africa, top markets are South Africa, Nigeria, Kenya, Ivory Coast, Morocco and Egypt. South Africans prefer Portugal, the US and Malta. Nigerians prefer Cyprus which is the most expensive and the best program. They also like Antigua and Barbuda. Ivory Coast prefer Canada and Montenengro,” explains Arton. “For African business people, I would recommend the EU countries such as Malta, Portugal and Montenegro.”
“In the last 3 years, we see that Kenya, Nigeria, followed by South Africa are the key dominant countries for an alternative citizenship through investment,” says Rafail. “But as a region, North Africa (mainly Egypt, Algeria, and Libya) dominates the market. Each country for each own reasons: Nigeria and Kenya is mostly for visa free access purposes. In South Africa, there is a wave of entrepreneurs who want to conduct business in Europe and seek such flexibility through these programs. Finally, North African clients- always interrelated to the Middle East, are looking for a safety pillar.”
From the Henley Passport Index, the countries with the highest demand are both Malta and Cyprus due to the fact that they allow an applicant to settle, work and live in Europe.
“Other clients that are mainly seeking Visa free access tend to seek an alternative citizenship in the Caribbean islands with Saint Kitts being their favorite choice,” adds Rafail. “An EU passport (Malta, Cyprus) allows you to settle, work, study and live in any EU country. This is why these programs are more expensive than the Caribbean ones.”
The citizenship costs from Henley and Partners site:
Antigua and Barbuda from USD 100, 000 with visa free access to 149 destinations
Austria is from multiple EUR millions depending on the form of investment, with visa free access to 185 destinations and settlement rights in all EU member states.
Cyprus from EUR 2.15 million with visa free access to 173 destinations
Montenegro EUR 350, 000 with access to 122 destinations