Last updated: November 1, 2018
Dateline: Andorra la Vella, Andorra
It would take you at least 20 years to get citizenship here in Andorra. Here, where residency rules are relatively straightforward, naturalization is extremely tough to come by. In fact, it’s one of the most grueling naturalization timelines on earth, behind only San Marino and Liechtenstein.
Spain, where I’ve been spending the month, isn’t much better at 10 years, plus four more for bureaucracy. For those who want a fast second passport, there are only two options: be lucky enough to have certain European lineage, or fork over some cash.
Citizenship by investment is a process whereby wealthy individuals can obtain a second citizenship extremely quickly in exchange for an investment or donation. These so-called “economic citizenships” are largely valuable to three types of people:
- US citizens who wish to quickly renounce their citizenship. Pragmatically, renunciation requires a second passport, and if you’re a high-earner, the cost of an economic citizenship might be far less than the tax and compliance costs of remaining American, particularly as tax laws have become even worse for foreign business owners under Trump Tax Reform.
- Emerging world citizens losing opportunities. Chinese and Arab citizens are the largest investors in citizenship by investment programs. The wealthy in these and other countries can afford the cost in exchange for the greatly increased travel benefits.
- Business owners and investors looking for a “Plan B”. While US citizens have the most immediate need for a second passport and can often earn an immediate ROI, other country’s citizens can also benefit from having another citizenship in their back pocket… just in case. This is especially true for cryptocurrency investors who may need a second passport to continue their investments. If you’re earning high six- or seven-figures, you may find buying citizenship easier and cheaper on a time-cost basis than the longer, more elusive naturalization route.
In this article, I’m going to discuss each of the citizenship by investment programs on the market in 2020. But before we cover the best countries, let’s establish a few definitions…
WHAT MAKES THE BEST CITIZENSHIP?
As perhaps the only person who covers the second citizenship scene to have actually been through three CBI processes personally (St. Lucia, Dominica – which I aborted, and Comoros), I’m uniquely qualified to speak on this subject.
Many people feel that the number of countries a passport allows you to visit defines the quality of that passport. As a former US citizen, I grew up with the notion that it was possible to fly just about anywhere in the world without worrying about visas. The idea of potentially giving up your home country’s passport can be scary and can lead to focus on the travel privileges that come with your new passport.
I and other industry experts, however, believe that a passport is not defined by its travel privileges alone. If it was, the United States would have among the world’s best citizenships, and no one would be calling me asking for help renouncing their US citizenship.
In fact, I created the Nomad Passport Index to rank countries on the quality of their citizenship, and not just their passport. Being a US citizen with a huge tax burden is inferior, in my mind, to being a Saint Lucian and Montenegrin citizen who occasionally needs to get a visa, but has far more personal and financial freedom.
For one thing, you should consider which countries you actually want to travel to, and whether a second citizenship would allow you to travel there. If you need to visit Russia for business, there are three CBI programs that offer such visa-free travel, and the fact that you might give up visa-free travel to the Congo wouldn’t matter nearly as much.
If you’re a western citizen, the deep discount of Caribbean programs over European Union citizenship programs can be quite appealing. While many Chinese, Arabs, Russians, and Indians may prefer an EU passport, westerners such as myself realize that “Tier B” passports (with good, but not great, travel privileges) are the wave of the future and not only cost less, but come without the baggage of a crumbling bloc of mostly socialist countries.
In my mind, the best citizenship by investment program is one that allows you to intelligently preserve your capital while accomplishing your goals.
When I renounced US citizenship, I had a few fellow passport geeks who poked me about my newfound inability to visit the Central African Republic without first getting a visa. The idea of losing a few visa-free countries or access to US embassies may sound annoying, but in reality I’ve seen no downsides yet.
Bottom line: Make sure your bases are covered, but don’t overspend or become obsessed with shiny objects that don’t matter.
RESIDENCY VS. CITIZENSHIP BY INVESTMENT
If you’re not a US citizen, you are less likely to need a second passport in order to reduce your tax obligations. For you, a second residency and/or tax residency may do the trick. However, I do think having a second passport is worthwhile for anyone doing business or investing, particularly cryptocurrency investors as new laws unfold all around the world.
To be clear, economic citizenship is for people with a pressing need to have another passport now, be it for tax reasons, business, or travel.
Residency by investment is not the same as citizenship by investment. Golden Visa programs like those in Portugal and Greece will eventually yield a second passport, but it will take at least six years in most cases.
Other countries offer what I call “fast track naturalization”, which may or may not be commoditized. These are what I call “get paid to get a passport” countries. Austria is sometimes touted as an economic citizenship program, but it’s really a fast track program for people the government deems “desirable” (meaning a Canadian is far more likely to be approved than an Indian).
Still other countries like Panama offer a Friendly Nations Visa that streamlines residency requirements, but also requires years for naturalization… and has no 100% guarantee of paying off in the end.
These second residency programs are great for tax residency or for a future Plan B passport, but they are merely creating yet another path to residency, with citizenship being the future benefit of residency.
Now, let’s get started…
Citizenship By Investment Programs
THE BEST CITIZENSHIP BY INVESTMENT PROGRAMS
Each of these programs are fast, commoditized, legal in the country itself, have a clear path to citizenship, and are open to (almost) anyone with a clean criminal record.
Let’s compare the countries offering legitimate citizenship by investment…
EUROPEAN CITIZENSHIP BY INVESTMENT
There are three economic citizenship programs in Europe, or four if you consider that part of Turkey is in Europe, which I did here to keep this article clean. Montenegro has also promised a new program which has not been finalized yet.
For those who want the best of the best and are willing to do proper tax planning, two of these countries are located within the European Union and hence confer EU citizenship alongside the sovereign nation citizenship.
Cyprus is a member of the European Union and, until recently, offered the fastest naturalization I’ve ever heard of: just 57 days. I visited Cyprus awhile ago and published a video discussing Cyprus citizenship.
There are constant rumblings that the process will start to take longer though, particularly as the EU cracks down. Cyprus’ saving grace so far has been that while it enjoys visa-free travel to all of Europe, it is not actually a part of Europe’s borderless Schengen Area.
You can obtain Cyprus citizenship with an investment of €2 million in real estate, government bonds, a bank deposit in a Cyprus bank, or investment in a new company; this amount was most recently reduced in late 2016.
Cyprus citizenship was always pricier than other options – at one point costing well into the eight figures – but unlike most other programs, you can invest rather than donate. If return of your capital is important, Cyprus may be more attractive than the only other EU citizenship program in Malta.
There’s a bit of a catch, though: you must own a €500,000 home in Cyprus forever. The requirement to maintain a residence on the island is likely a hat-tip to foreign government demands for investors to maintain a “real presence” on the island rather than simply buying a Cypriot passport. It’s not entirely clear what would happen if you sold your property, but the law is indeed clear at least on paper.
As of late, some Cypriot cities have become hot destinations for development. Limassol – dubbed “Moscow on the Mediterranean”, now sports more skyscrapers than almost any other European seaside as a result of passport investment.
Oh, and one more caveat: your home purchases are subject to VAT, meaning you will end up paying “sunk costs” even though your qualification is technically an investment. Whether you can recoup that 5% to 19% later will be determined by the market.
VERDICT: Cyprus offers EU citizenship, but isn’t part of Schengen and its passport can’t get you into the United States. If you were planning to start a low-tax company with seven figures or buy a luxury seaside villa, it’s worth considering.
Unlike Maltese residency which is a more simple process (especially with Global Resident Programme), there’s a lot of conflicting information out there about how to get Maltese citizenship, partially due to some earlier vagueness from the government.
Malta is the only citizenship by investment program that sells access to both the European Union AND the borderless Schengen Area. It’s also the only passport that offers visa-free access to all six big English-speaking countries, including the United States.
Considering that, Malta is almost immediately a better deal than Cyprus for many people, particularly if you’d rather donate a much lesser amount and invest the difference.
Unlike Cyprus, Malta requires a government donation in addition to the typical fees present with all programs. The donation is €650,000 for the main applicant, plus €25,000 for a spouse and each minor child. Adult children up to 25 years old and dependent parents may be added for an additional €50,000 fee per person.
In addition to the donation, you must also invest €150,000 in Maltese government bonds — or occasionally Maltese stocks — for a period of five years. Lastly, you must purchase a home on the main island for €350,000 or more, or rent or enter a five-year lease for at least €16,000 per year. And you actually need to spend some time there while it takes about 15 months to issue your Malta passport.
VERDICT: I’m not bullish on Maltese real estate, but I’m not running for the hills, either. If you can comfortably kiss €650,000 goodbye, this is a great program that covers all of the bases.
I spent a year tracking the development in Moldova’s citizenship program before it even became public, including putting boots on the ground. I first visited Moldova in 2014, and while I wouldn’t want to live or own property there, I find the place interesting; a sort of emerging Romania with smart people and largely defeatist attitudes.
Moldovan citizenship is somewhat unique among competitor programs in that it does not offer visa-free travel to the United Kingdom or Ireland, but does offer visa-free travel to Europe’s Schengen Area and to Russia.
My friend Christian suggests that Moldova’s program will attract a different type of clientele; namely, Russian investors willing to establish ties in a country whose politicians are torn between the west and Russia.
To become Moldovan under the brand-new program, you must either donate €100,000 plus pay a government fee, or invest €250,000 in approved real estate. The type of real estate available for investment has yet to be determined, but I don’t see any path for property of any kind in Chisinau to appreciate, let alone “government approved” real estate in a rather corrupt country.
Another issue is that, while Moldova is a “real country” compared to competing Caribbean options, the fact that any Russian oligarch can now buy his way in will surely raise the ire of authorities just as much as a Caribbean passport would.
VERDICT: An interesting addition to a passport portfolio for the high-net worth investor who wants access to Russia in addition to other passports. If you plan to get more than one second citizenship, Moldova is worth considering. Otherwise, it doesn’t offer the bang for buck I’d expect.
In January 2017, Turkey introduced an economic citizenship program in an effort to prop up their beleaguered economy. This was shortly after the Turkish lira plunged to an all-time low against the US dollar and ongoing acts of terrorism had driven Istanbul real estate sales to fresh lows. In an effort to woo investors again, Turkey’s government decided to offer citizenship to millionaire investors.
However, it didn’t take long for Turkey to lower their requirements. Today, you can invest the Turkish lira equivalent of $250,000 into real estate – and hold it for three years – to become Turkish in a matter of months. The process can be a bit complicated, because all properties need to be purchased on the same day and titled in the same office, meaning you can’t score a cheap Istanbul apartment and tack on a beach house in Antalya to qualify.
You’re also at the mercy of the lira exchange rate on the day of the sale, as well as an appraisal that may not value cheap resale properties (the kind that make good investments) as highly as new construction. While you can technically buy any real estate you want, you need to have a plan.
If you prefer to deposit money in the bank, you may deposit $500,000 for three years in a bank, in a working company as venture funding, or in bonds. You can also hire fifty Turkish citizens to qualify.
I was clear from the beginning that this program targeted mostly Arabs seeking an Islamic safe haven, but the price reduction may make it interesting to more people. While there is mandatory military service, it won’t affect you unless you’re really young or plan to pass citizenship to your future children.
VERDICT: Turkey’s program is interesting in that, like Cyprus, you stand a decent chance to get your money back and even turn a profit on its economic citizenship offering. A Turkish passport can come in handy as part of a passport portfolio (something I help people create), but I still think it’s not enough on its own.
CARIBBEAN CITIZENSHIP BY INVESTMENT
Now, let’s move out of Europe and into the Americas, namely the Caribbean. The Caribbean is home to five citizenship programs, including the oldest such program in the world. It is also the first thing people think about when they think “citizenship by investment”, since non-Caribbean options are all relatively new.
ST. KITTS AND NEVIS
St. Kitts and Nevis runs the original economic passport program, in operation since I was born in 1984. Other Caribbean programs have copied it, and the program has enjoyed a lot of success up until now. The two-island nation likes to refer to itself as the “platinum” citizenship program in the region.
The requirements have always been simple: you can donate money to a government development fund, or you can buy “approved” real estate. The donation is almost always the better option, as the real estate is vastly over-priced and, as some clients have told me, not even very nice.
Until recently, the donation option started at $250,000 and went up from there. Then hurricanes hit, and St. Kitts rolled out a controversial Hurricane Relief Fund which slashed the price and allowed family members to come for free. The Hurricane Relief Fund is no longer available, but the donation now starts at $150,000.
The real estate investment is $200,000 and up, and there are many providers ready to sell you everything from a shack to a timeshare in a five-star hotel. You can technically re-sell it in several years, but likely won’t get your money back. The real estate option involves extra government fees.
St. Kitts has a few perks: it offers a rush option to get approval within 45 days if you have a valid reason to request such a thing, and as of recently it offers visa-free travel to Russia.
VERDICT: St. Kitts and Nevis used to be the only game in town, but it has lost its luster since losing visa-free access to Canada in 2014. They’ve taken efforts to correct their pricing due to recent price wars, but it’s still intentionally overpriced.
Dominica was the lowest-priced passport “for sale” on earth, ever since Belize ended its $40,000 program years ago. It just goes to show you that passport prices are going up very quickly.
Dominica now has competition at the $100,000 price point, but it does have a longer track record to speak for it. However, its passport’s travel privileges are rather similar to those of St. Kitts and Nevis with the exception of Russia.
Dominica does require economic citizens to speak “basic English”, which I believe is pretty straightforward. After all, you’re reading this. If you are a citizen of Afghanistan, Iraq, North Korea, Pakistan, Russia, Sao Tome Principe, Saudi Arabia, Somalia, Sudan, Turkmenistan, Uzbekistan, or Yemen, you’ll be subject to special scrutiny.
VERDICT: If you’re seeking a “budget passport”, Dominica is worth considering. I consider it for budget-conscious people I help, but it is no longer the only game in town.
Grenada used to have a citizenship program, but cancelled it. One unconfirmed report indicated that the government had to be bullied into re-issuing economic citizens’ passports after they expired five years later. Now, Grenada is back.
Grenada’s most interesting features are visa-free access to Russia and China, as well as being the only Caribbean CBI to be part of the United States E-2 treaty program. Basically, it offers a simplified procedure to live part-time in the US as a business owner, and that makes it rather attractive to many people.
Grenada allows you to make a (newly reduced) donation of $150,000 for a single person or $200,000 for a married couple in exchange for citizenship. You can also buy $350,000 worth of approved real estate, of which there are actually a few interesting options that effectively serve as zero-coupon bonds.
VERDICT: Grenada does charge a premium, but you may find the extra investment worth it for access to China, Russia, and the United States. However, I would suggest that anyone getting an economic citizenship consider getting a “real” second passport as well, and that other passport might also offer those benefits, make Grenada redundant.
ANTIGUA AND BARBUDA
Antigua started its citizenship program in 2012 with a unique requirement: citizens must live there for 35 days out of the first five years. That requirement isn’t exactly tough, as you could knock it out with a month-long vacation to celebrate your new passport, but it is a requirement nonetheless. I do think this will be a trend, although Antigua has since reduced the requirement to a mere five days.
Antigua’s investment options are pretty standard fare for Caribbean passports and range from a $125,000 donation to the government to a $400,000 real estate investment to a $1.5 million business investment. The only interesting alternative is that you can invest only $400,000 into a business if join a group with other applicants investing at least $5 million collectively.
Antigua joined the recent price wars, slashing its price to match Dominica and St. Lucia, but adding an additional processing fee. The interesting angle, however, was that a family of four could apply for the same price as a single applicant, making it the cheapest option for families. I once joked on social media that I wanted to get married just to get two-for-one Antigua passports.
Antigua is an interesting budget option with several investment options, but it has been leveled by also losing visa-free access to Canada, just as St. Kitts did earlier. Antigua is the only Caribbean CBI to offer visa-free travel to South Africa, but that’s about it.
VERDICT: Antigua and Barbuda offers more options for investing, but it really depends on whether you’re single or married to determine whether it’s the best value for you.
St. Lucia offers the newest citizenship program in the Caribbean, and their requirements were originally a bit more stringent. While St. Lucia originally required you to have a net worth of at least $3 million, they dropped that requirement in 2017. They also dropped the required donation for citizenship significantly, with the donation option now costing a mere $100,000 – the same as Dominica.
The best option in most Caribbean passport programs is to make a donation, although St. Lucia also allows you to invest in real estate or start a business. If you choose the donation route, the amount for a single applicant has been lowered to a mere $100,000 as of 2018. St. Lucia also promised to speed up its processing.
St. Lucia offers a few benefits for families, namely that the donations and fees are reasonable, and that they allow dependent parents to be included in the application. Historically, the easiest way to become a St. Lucian citizen was to invest $500,000 in government bonds, which must be held for five years.
If you prefer to purchase real estate, the minimum is a mere $300,000. Again, I generally recommend avoiding such “approved real estate”. I also recommend against the business investment option that requires $3.5 million and the creation of three jobs; qualified entrepreneurs could find better countries to give them citizenship with that kind of investment.
In full disclosure, I am an economic citizen of St. Lucia. That doesn’t mean it’s the right program for you, but I have been happy with my experience with them.
VERDICT: Now that St. Lucia has reduced its donation to a mere $100,000, it’s a worthy competitor to Dominica for value-conscious westerners who want a passport further off the radar for its economic citizenship program. Definitely worth considering.
SOUTH PACIFIC CITIZENSHIP BY INVESTMENT
While there have been rumors of economic passport programs in random Pacific islands over the years, there is currently only one offering a rather “weird” product: Vanuatu.
I recently spent a week in Vanuatu and am sure that the country offers the world’s most confusing citizenship by investment program. It was interesting how, three days after arriving on Vanuatu soil, a group of local experts had invited me to their boardroom to ask what I thought of their passport program. My review was not good.
There are various donation options and even the most seasoned of expats with their ear to the ground don’t really understand how they work. Basically, you can expect to spend about $250,000 when you count the government donation and agent fees payable to a local ni-Vanuatu.
Vanuatu passports are one of three economic citizenships that offer visa-free travel to Russia, and also offer the standard access to the United Kingdom, Ireland, and more recently Europe. However, they are not good for travel to most of the Americas or even Australia in their own backyard.
In my opinion, which is shared by others in the field, the biggest challenge for Vanuatu is its ever-changing requirements and unclear policies on what is essentially an honorary citizenship.
VERDICT: I like Vanuatu and see potential for tax-free residency seekers, but the passport program is overpriced and too confusing. The lure of being isolated geographically and hence different from Caribbean programs doesn’t sway me.
What’s the absolute best economic citizenship program? As with anything else, it depends on your needs. For most people I work with, a fast-track naturalization program is better than “buying” citizenship outright, but if you’re in a hurry, I’d focus on Malta (for European access), Dominica (if you travel to Russia), and St. Lucia (if you want a clean passport and/or a place to live), or…
OTHER CITIZENSHIP OPTIONS
The programs here are “off the shelf” options available to pretty much everybody, save for the Iraqi citizen who most countries will subject to extra screening.
Depending on your situation, there may be other options. Do you have a business that can create local jobs? Are you a real estate investor willing to invest in a large project? Are you a US citizen?
If you want a nearly 100% guarantee of getting citizenship in 4-12 months, the programs above are best for you. If you prefer to invest less — or if you believe you have other benefits you can bring to a country besides just a checkbook — there are a few of countries that offer conditional economic citizenship.
If you are an entrepreneur or investor looking for other legal alternatives, feel free to go through my application process and see how I can help. Working with someone who has done this themselves and for others can increase your results, because I personally understand your “why”.