COVID-19’s Effect on Dual Citizenship Investor Priorities

With the advent of COVID-19, global economic activity is at somewhat of a standstill to take an aggressive stance to slow the spread of the disease. This, in turn, has had a widespread effect on how, when and why investors spend their money.

Inexorably, the pandemic has had a direct impact on international investors, particularly those looking to take advantage of one of the many CBI programmes on offer. Remarkably, however, there has been an encouraging increase in interest within the sector.

CBI programmes allow well-vetted investors and their families to contribute most often to a government fund or pre-approved real estate in exchange for citizenship of that country.

Notwithstanding this influx in applications, it has also become abundantly clear that investor priorities are not necessarily what they were previously, compelling countries that offer CBI opportunities to shift their focus and offer highly competitive programmes. Dominica, for the fourth year in a row, has been named the best CBI programme, according to the 2020 CBI Index. The CBI Index is published by the Financial Times’ Professional Wealth Management magazine and is a comprehensive ranking system that compares active CBI programmes worldwide.  

What investors want from their second citizenship investment 

While at the top of mind for any savvy investor is value for money and certainly return on investment, the CBI Index measures CBI programmes against ‘pillars’ that represent other key investor priorities as well.

In addition to the seven pillars featured since its inception, the 2020 CBI Index has introduced two new pillars: Family and Certainty of Product, which have proved paramount in the criteria for foreign investment.

The nine pillars currently include:

  • Freedom of Movement
  • Standard of Living
  • Minimum Investment Outlay
  • Mandatory Travel or Residence
  • Citizenship Timeline
  • Ease of Processing
  • Due Diligence
  • Family
  • Certainty of Product

As international travel has seen significant restrictions during 2020, this has also brought to light the countries whose medical systems can deal with a major health crisis such as the pandemic in which the world currently finds itself. This has pushed high net worth individuals to explore alternative citizenship and residential options, with the focus shifting towards healthcare and quality of life.

With its extensive lockdowns and travel bans, 2020 has ushered in unparalleled economic declines and uncertainty. However, towards the end of 2020, the CBI industry has seen a record number of applications. Many nations have become increasingly aware of the benefits of CBI, particularly as an effective measure for generating much-needed income and crucial investment during periods of increased economic turmoil.

Before COVID-19, investors looked to CBI as not just a second passport, but a platform from which to launch themselves into a world of visa-free travel, greater social interaction and globalisation, with the freedom to travel almost inevitably being a priority.

However, with the door to international travel being veritably closed, investors have been reminded of the vital importance of home and safety, and this, in turn, has triggered a refocus on countries that are healthy, happy and hospitable.

Resting in the assurance that you will be welcomed into the local community has proven to be of fundamental importance. Being able to rely on the compassion, kindness and community spirit of the locals is more critical than ever as people seek a real home away from home.

Investors are also now looking to countries that promise access to responsive, robust healthcare systems. While many regions throughout the world were crippled under the pressure of the surging health crisis, there are many countries, particularly the island-states in the Caribbean, that have been incredibly successful in containing the disease and reporting widespread recovery.

As more and more people are working from home, investors are assigning deep value to have a happy home environment. This includes the surrounding natural environment as people are becoming cognizant of the effects of air quality and the strength of the surrounding ecosystems, which directly affect food availability.

There is a recognised disparity between the smoggy, fast-food laden, concrete mazes of the city, and somewhere like Dominica or St Kitts and Nevis in the Caribbean that offer lush surroundings, sunshine, clean air, a thriving ecosystem and access to organic fruits and vegetables.

Home and citizenship are tightly linked, as only citizenship can give certainty that a person will be able to settle somewhere indefinitely. A second passport is, therefore, a vital step for investors to obtain a home that fulfils the changing priorities brought about by the COVID-19 crisis. And, as the CBI Index demonstrates, few options for citizenship are as seamless and expedient as Citizenship by Investment.