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Residence and Citizenship by Investment

Investment Migration: An Innovative Wealth Generator for BRICS

Dr. Juerg Steffen

Dr. Juerg Steffen

Dr. Juerg Steffen is Chief Executive Officer of Henley & Partners.

Investment migration has emerged as a powerful tool for governments to strategically attract wealth, talent, and capital to their economies, enhancing their sovereign equity and financial independence. The expanded BRICS bloc, which recently welcomed five influential emerging economies, represents almost half the world’s population and accounts for a global GDP of over USD 28 trillion, which presents highly attractive opportunities for investors, entrepreneurs and talented high-net-worth individuals.

Avenues for BRICS to boost sovereign equity 

In the dynamic landscape of global finance, alternative residence and citizenship by investment programs offer a win–win proposition as they have the power to magnetize affluent investors and stimulate economic growth. Investment migration can act as an innovative financing mechanism by steering developing nations, which make up a large proportion of the BRICS bloc, away from debt-driven financing to more autonomous avenues of foreign investment. If competently implemented, investment migration frameworks can contribute significantly to the well-being of local citizens while yielding the host state a wealth of development benefits.

Glowing pixel map of the world with a graph spanning across it overlaid on a view of a city from a window

In Europe, Malta is a prime example of alternative residence and citizenship initiatives being employed to build a government’s sovereign equity. The Malta Permanent Residence Programme and Malta Citizenship by Naturalisation for Exceptional Services by Direct Investment Regulations, which allow for the granting of citizenship by a certificate of naturalization to foreign individuals and their families who contribute to Malta’s economic development, have helped the country become one of Europe’s fastest growing economies.

The European Commission’s autumn forecast in November 2023 revealed that Malta saw the strongest economic growth across all European Union member states last year and is forecast to repeat this in 2024 along with its high pace of employment. Before Malta launched its original citizenship program, the Individual Investor Programme, in 2014, the island nation had struggled considerably after the 2008 financial crisis and sought to use investment migration as a tool to transform itself into one of Europe’s most favored wealth hubs. This success has built greater sovereign equity for Malta, supported its development needs, and fortified its economic resilience should another crisis arise.

Magnetizing millionaires and attracting capital 

Residence and citizenship programs can act as gateways for foreign capital injection, generating growth and enhancing employment opportunities. New BRICS member, the United Arab Emirates (UAE), has excelled at transforming its economy over the past decade by pushing a pro-innovation agenda, supporting a fiscally attractive legal framework, and implementing investor-friendly policies.

A key factor that has led to its success has been the UAE’s residence by investment offering. This 10-year renewable residence visa is granted to talented professionals, high-net-worth individuals, and entrepreneurs, with a range of options available, including an investment of approximately USD 550,00 in various eligible UAE real estate targets. The UAE has catalyzed its economic prosperity, positioning itself as one of the world’s greatest wealth magnets, second only to Australia, according to the Henley Private Wealth Migration Dashboard.

By strategically incorporating formal residence and citizenship by investment solutions and marketing them globally, BRICS countries can fast-track their economic development and secure greater financial autonomy to fuel and sustain their growth

A strategy to strengthen sustainable development

The past 12 months have been plagued with extreme climatic incidents, from hurricanes and droughts in Africa, frosts in Afghanistan, floods in India, and widespread wildfires in Canada, Greece, and the USA. These climate threats are becoming even more pronounced because of global warming, adding more pressure on the fiscus in every jurisdiction. BRICS countries in particular face significant exposure to these climatic risks, making the development of resilient economies that address sustainability and environmental concerns more essential.

By leveraging tailored investment migration programs that funnel direct foreign investment into renewable energy programs, green projects, and sustainability initiatives, BRICS countries can boost their climate resilience and mitigate these environmental risks. Funds from alternative residence and citizenship programs can also be channeled specifically into sustainable development projects so that governments limit their reliance on foreign public debt sources.

The Grenada Citizenship by Investment Program is one example of a nation that has applied investment migration tools to fortify its sovereign equity and counter the risks of climate change, transforming its economy and bolstering its fiscal autonomy. Applicants can opt for a USD 220,000 real estate route or a donation option that requires a USD 150,000 contribution to the National Transformation Fund, which is focused on sustainability and development.

As Grenada’s prime minister, the Hon. Dickon Mitchell, recently pointed out at Henley & Partners’ 17th Global Citizenship Conference in Dubai, “fiscal resources are constrained by the size of the domestic economy, and accessing finance from multi-lateral institutions can lead to sovereign debt, dependency, and an erosion of our hard-won autonomy that we hold so dear. In our experience, investment migration programs offer a way to address many of these complex challenges.”

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