Some of our clients love the idea of having a passport for every habitable continent. Is this something that resonates with you?
Every continent has something to offer, whether it’s culture, heritage, attractive tax systems, or great real estate markets.
African countries and cities are slowly but surely tapping into the investment immigration industry and becoming up-and-coming places noticed by investors, digital nomads, and those seeking greater diversification.
If your offshore plans involve similarly adventurous end goals, contact the Nomad Capitalist team. We help seven and eight-figure entrepreneurs and their families reduce their taxes legally in search of a better lifestyle and go where they are treated best.
What is the AU passport?
So what is the AU? And what does an African passport have to offer?
The AU — or African Union — is an international organization comprising 55 African nations, every country on the continent.
The African Union has existed in one form or another since 1963 and has sought greater unity across the continent over the years. A new electronic, biometric passport was announced by the AU in 2016 and is the leading project of the organization’s Agenda 2063.
According to an AU press release, the passport “has the specific aim of facilitating free movement of persons, goods, and services around the continent – in order to foster intra-Africa trade, integration, and socio-economic development.”
Though its availability is currently restricted to heads of state, ministers of foreign affairs, and permanent representatives of AU member states, the goal is for the Common African Union passport to be available to all African citizens in the future.
In preparation for the increased integration, many African nations have begun to make changes to their visa restrictions. Senegal, Seychelles, Mauritius, Ghana, and the countries of the East African Community (including Burundi, Kenya, Rwanda, Tanzania, and Uganda) have all improved their visa requirements in recent years.
Challenges to African unity
Despite such progress, many obstacles still limit the possibilities of making the AU passport a functioning reality. Currently, the majority of AU member countries require visas from visitors from other countries on the continent.
In addition, corruption, inefficient civil registration systems, and unnecessary and costly bureaucratic procedures mean that one in three people in Sub-Saharan Africa have no legal identification.
These and other challenges are part of the reason why intra-continental trade in Africa makes up only 14.4% of the region’s trade. While the AU passport aims to reduce such issues, it will also have to deal with the underlying problems involved if greater unity is to be achieved.
Another challenge is the time and resources needed to get nations up to speed on the technology the passport utilizes. Anti-immigrant sentiment is also high in many countries where visa requirements were created to keep people out intentionally.
And then there are always the corrupt governments that use passports to silence their critics. Chad, Djibouti, Eritrea, Sudan, and Zimbabwe have all been caught confiscating passports from their opponents, whether they be trade unionists, opposing politicians, minority religious groups, or human rights activists.
Getting up to speed on that technology will take time and resources that many nations do not have. Another factor in the way is the anti-migrant sentiment, which is already high in parts of the continent. Many visa requirements were implemented as intentional barriers to keep migrants from entering neighboring nations and competing for jobs.
While other countries have worked to create laws guaranteeing the right to a passport to every individual, it’s clear that Africa isn’t a leader when it comes to passport freedom.
The AU vs. the EU
Challenges and all, the concept of the African Union passport is a refreshing new development. One thing the AU has going for it is that it can learn from the mistakes of other organizations — namely, the EU.
The African Union is a very interesting concept because, unlike the European Union, they’re allowing freedom of movement without all the nonsense of Brussels telling the UK what to do, which led to Brexit.
For citizens of African countries, this is a great opportunity with a lot of promise. The movement of people, ideas, and goods would be a lot easier, and a common passport would be a step toward greater unity.
But what about the rest of the world? Could an African passport have a place in your offshore plans?
How Does An African Passport Fit Into An Offshore Plan?
If you’re looking for a second passport because you want to renounce your US citizenship, pay less in tax, or have a Plan B, then you probably don’t want an African passport.
However, that doesn’t automatically mean you shouldn’t consider it. There are two reasons why you may want to obtain an African.
The first may just be for the sake of novelty. If you want to visit every country in the world, you’ll soon discover that some countries can be a real pain to get into.
African countries are horribly bureaucratic. In Jim Rogers, investment guru and Nomad Capitalist Live speaker, books Adventure Capitalist and Investment Biker, he talked about driving his car and riding his BMW motorcycle all over the world to learn about investment opportunities on the ground. Throughout his adventures, he constantly had problems getting into African countries.
So, the right passport could allow you greater ease of access to all of Africa.
And that ease of access will benefit not only adventurous travelers but people looking to do business throughout Africa as well.
In fact, that is the second reason you may want to consider the African Union passport. Many stable African countries where you would want to invest are opening up and increasingly welcoming foreigners.
How do you play these opportunities in Africa?
The real growth opportunities are on-the-ground real estate or direct investment into local companies. For example, Kenya in the East African region is an attractive option, and many small businesses, specifically tech companies, are cropping up.
Nowadays, African countries are attracting more and more Investments and more people willing to invest in an emerging market.
Should You Become An African Citizen?
If you do decide to pursue citizenship in an African nation to qualify for a passport, make sure you get it from a country that will work. You have to be strategic about choosing the country you’re going to be from. It needs to be moderate and credible.
There are reasons why we would recommend getting African citizenship to certain clients. In each situation, it would be for individuals who do it in tandem with other things as part of a holistic strategy.
Countries Worth Considering
You might want to start working towards citizenship in an African country now to be prepared for when the AU passport becomes available to the “public.”
There are also very interesting opportunities for the more adventurous investors. We have been helping clients over the years and have seen a high success rate and high returns.
For younger entrepreneurs, Africa could be a good place to go if you already have established capital. Of course, there are still some challenges, including intense bureaucracy, and you aren’t going to benefit from free resident citizenship generally by investing in Africa.
Egypt:
Egypt is a top option from our perspective, with great talent, affordable prices, English-speaking people, and a huge economy.
Also, is geographical proximity to the Middle East and Europe more conveniently geographically located and extremely cheap real estate. There are even citizenship possibilities in Egypt when buying certain real estate or putting money in the bank.
Morocco:
Number two on the Rand Merchant Bank list of Investment Attractive African Countries is Morocco. It is called one of the more stable economies in North Africa. Again, they have a well-educated population there and the benefits of closer ties with Europe.
It has a smaller domestic market but very affordable lifestyle properties if you want to live on the water, for example, but fewer opportunities in terms of large-scale investments.
Mauritius:
This island country offers permanent residence for investing in property, not a passport. It is currently challenging to acquire Mauritian citizenship, and the government actively discourages people from applying. Mauritius also does not have a program for naturalization.
Digital nomads looking for good Internet-speed job opportunities and adventure are also looking to African cities, with some of the top choices including Cairo, the capital of Egypt, Marrakesh in Morocco, Santiago on Capo Verde, and Port Louis in Mauritius.
Are you of African descent and would like to reconnect with your ancestry?
Obtaining citizenship by descent, also known as citizenship by ancestry, means you can become a citizen of a country based on your familial connections to that country. The specific rules and requirements for citizenship by descent vary from country to country. If you’re curious about whether you meet the requirements, we can help.
We are sure there are a lot of countries where you could pay someone to get a passport, but who knows how that will work out. As a rule, stay away from gray and black market-selling passport scams.
For adventurous nomads and investors, there are a lot of opportunities on the continent, and Nomad Capitalist can help as a boutique consultancy for seven and eight-figure entrepreneurs and investors who want to legally reduce their taxes, diversify, protect their assets, and increase their freedom.
If you would like to hear more about opportunities in Africa, including which countries do have residence by investment program citizenship, reach out to us today.