Interview on BusinessTech: These are the top 5 Caribbean destinations South Africans are investing in for a second citizenship.
By Chris Buchanan
THE subject of global citizenship a.k.a. dual citizenship or alternative residence is occupying more and more column space in financial media as South Africa spirals into economic uncertainty and socio-political tension. Chris Buchanan talks to Nadia Read of LIO Global about the real benefits of these schemes and one or two blind side possibilities that could cost you dear.
A recent article on Traveller24 listed the 97 counties South Africans can visit on their passport alone, no visa required. The comments made for interesting reading, generally slating the fact that of the 97, not many were worth the trouble for a holiday, never mind a second home or business possibility. If you want to do business globally in the economies that won’t bury you in red tape but will give you access to important markets, you will need expand your business out of Africa and into a country with credibility.
NADIA READ says the following about the importance of having options when entering global markets, “For business owners who travel extensively, a second citizenship can open many global doors. Freedom of mobility and travel allows flexibility and ease of movement, as visa restrictions become more stringent and restrictive to South African businessmen and women. Establishing companies as well as bank accounts is easier, less hoops to jump through.
Big names like Elon Musk and Mark Shuttleworth, despite having moved abroad have done wonders for brand South Africa. A second passport allows not only freedom of movement but also access into EU, US, UK, etc.”
Barriers to entry will differ extensively from country to country and bear in mind the first and most significant of those barriers – the Rand/Euro/Dollar/ Sterling exchange rate. Suddenly you’re dividing your capital by 11, 12 or 19 so whether it’s an investment in government bonds, a start-up business or a property investment, your wheelbarrow full of Rands is an envelope of Dollars. European markets are also more sophisticated and competitive – they do business differently, less start-up red tape but more strict on corporate governance and fiduciary duty.
You have the cash and you’re ready to make the move to the EU which will give you the option of Cyprus, Malta, Portugal, Greece and Hungary. The details of each programme are well documented on the LIO Global website www.lio-global.com, but most important if you want your money well spent is to know the difference between what an EU Residence vs Citizenship can offer you.
READ says the following points should be considered when looking at the options:
• EU Residence gives travel access to Schengen zone countries for 90 days only. You can only live, work, study in country of residence – not anywhere in EU. Only EU citizenship gives the right to live, work and study anywhere in the EU .
• EU residence can change and is less secure than EU citizenship. Once you are a part of the EU, you are protected by EU law. Citizenship is much more secure in the long term.
• Most countries allow you to pass your citizenship or residence on to future generations. Eg. Malta, your kids can pass on to their kids, therefore establishing legacy plan for your future generations
• EU residence means you can only travel to 26 countries in the Schengen zone. With citizenship, eg. Malta or Portugal you can travel to over 160 countries worldwide. Malta also allows visa free travel to US and many other countries making it one of top 10 passports you can have.
ANOTHER potential pitfall says Read is understanding the benefits and risks to holding dual citizenship as a South African.
• You will need to complete a retention of citizenship with home affairs, otherwise you can lose your SA passport and you must notify them before you get your new passport.
• Make sure you get naturalisation certification in your new country of citizenship in order to allow you to renew your passport.
• Be clear on where your new freedom allows you to travel and other benefits such as reduced EU education rates – this can mean a massive saving depending on how many kids.
• When you travel, always leave on your SA passport.
• There’s an ease of opening international bank accounts, for example you can open an account in France even though have Maltese citizenship.
• Get yourself full understanding of the tax implications of a second citizenship.
MAYBE it’s a time zone thing or maybe it’s the ‘jet-set’ tag but the Caribbean is often overlooked as a citizenship option but offers some of the most successful and popular citizenship by investment programmes. Read says there are some really good reasons to consider the land of the Calypso with convenience being top of the pile:
• St Kitts and Nevis has been running program successfully since 1984 and have over 30 000 individuals who have acquired citizenship (includes children, dependents etc.).
• Fast and straight forward application process (very strict due diligence) with very limited, if any travel requirement to visit.
• Short processing time: St Kitts 6-8 months to get passport, Antigua 4-5 months.
• St Kitts and Antigua passports open no-visa travel to over 130 countries including the UK, the Schengen zone. They are commonwealth countries and form part of Caricom (The Caribbean Community).
• Antigua is an up and coming celebrity destination pushing property prices up and stimulating the economy. It is a beautiful and rustic tropical island, good holiday location and popular yachting destination.
• In short, passport application is straightforward and fast.
BUT if it’s the EU you’re set on then Malta is your best bet says Read and you need to start enquiries fast. Malta offers one of Europe’s most exclusive investor programmes, offering full EU citizenship in just over 12 months, problem is It’s capped at 1800 investors and will cost you over one million Euro. There’s no free lunch in life or business and gaining global access for you and your family to hedge yourself against uncertainty and instability, comes at a price. Your best ally in any citizenship by investment programme is doing your homework and using credible consultants to walk you through the process. There were a few investors who got hurt recently in EU property schemes and making an investment mistake is costly enough in Rand, do the multiplication and your loss is elevenfold. www.lio-global.com
~ Chris Buchanan Prestige
In an ever changing world, we face fresh challenges daily and need new thinking to meet these. One such challenge is global travel access. Whether you are packing for work or leisure travel, visa requirements to the world’s 194 countries can add a time consuming and costly element to your experience.
Visa free access highlights one of the key benefits of owning a ‘powerful passport’. A powerful passport is one that gives the holder visa-free access to as many countries as possible. Citizens of Sweden, Finland, Germany, the United Kingdom or the United States enjoy visa-free access to 174 countries. South Africa, meanwhile, is ranked 42nd in the world in terms of passport value, with access to 97 countries. This is according to Go Euro, a European-based rail, air, bus and car search and booking engine.
South Africa’s little green book is in fact one of the most valuable in Africa; after the Seychelles (visa-free access to 129 countries) and Mauritius (125 countries). Although this is encouraging, according to the Henley & Partners Visa Restrictions Index, African countries have seen a decline in their position within this global ranking with a drop of 25 spots. South Africa dropped one spot between 2014 and 2015.
South Africa has visa-free access to primarily developing nations, including almost all of South America, Southern and East Africa, and parts of the Far East. But developed countries – and ironically most of the BRICS countries, except Brazil – still require visas from South Africans
Overly stringent visa requirements are now encouraging many South African travellers to explore the dual-citizenship route. In fact, many countries now offer citizenship based on investment. Nadia Read, Private Consultant at LIO Global says: “There are several countries now offering investors either residence or citizenship through investment and we have seen in particular, a strong demand for access to EU citizenship. South Africans have a strong affinity to Europe, and more notably EU citizenship programs offer the ability to live, work or study anywhere within the EU. Education for their children is a strong driver for many families”.
LIO Global, a boutique consultancy specialising in assisting private clients and investors with residence and citizenship applications, says:
“As the political and economic landscape shifts, investors and families are looking for the security, access and freedom of travel that a second passport offers.”
The firm lists the benefits of holding a second passport as:
- Freedom of travel
- Wealth protection
- Expanded global business opportunities
- Back-up option for residence
If the developing world is your focus, a South African passport makes the world your oyster and the need to explore dual-citizenship less pressing. However, if you are looking to travel the developed world, it might be an idea to broaden your investment horizons in order to open the door.
LIO Global also mentions, “Most of the families we work with are very proudly South African and are not looking to physically leave South Africa, but rather they are looking for the freedom and access that an EU citizenship offers. This is especially true for parents wanting the option for their children to study abroad as well as business travellers looking for ease of global travel access.”
#Citadel #LIOGlobal #SecondPassport #CitizenshipByInvestment #HowPowerfulIsYourPassport