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Dr. Christian H. Kaelin, TEP, FIMC, is Chairman at Henley & Partners.
Malta directly collected EUR 1.4 billion through its citizenship by investment program between 2015 and 2020, transforming a nation of half a million people into Europe’s economic success story. The program generated the country’s first budget surplus in decades as well as its highest growth rate and lowest unemployment. When the IMF analyzed the program’s impact, it warned that its termination would increase Malta’s debt-to-GDP ratio by 3% — not insignificant for a country flirting with the EU’s new 60% debt ceiling mandated by the Stability and Growth Pact.
The funds materialized as tangible societal improvements. Malta’s National Development Sovereign Fund allocated EUR 66 million for social housing construction, EUR 10 million for health clinics, and EUR 27 million for urban greening and community projects. These investments represented infrastructure and services funded entirely by foreign capital attracted through a rigorously vetted pathway for high-net-worth individuals seeking European citizenship.
Then the EU Commission and the European Court of Justice (ECJ) intervened. In April 2025, the Court ruled Malta’s program incompatible with EU law, declaring it a “commercialization” of EU citizenship that undermined “mutual trust” between member states. The ruling dismissed both the Commission’s argument and the Court’s own Advocate General’s recommendation. The ECJ terminated a program that made great socio-economic contributions and had undergone years of refinement, comprehensive due diligence procedures, and regulatory oversight.
The ECJ’s decision reverberates well beyond Malta’s shores. By asserting that member states cannot determine their own citizenship criteria when investment is involved, the Court has fundamentally altered the sovereignty equation within the EU. This shift arrives as global demand for alternative residence and citizenship solutions accelerates, driven by geopolitical instability, mounting tax pressures in major markets, and heightened focus on mobility planning among wealthy families.
While the ruling terminated Malta’s citizenship by investment pathway, it did not touch residence by investment programs in Europe. Along with Malta, Greece, Italy, Latvia, Portugal, among others, maintain active golden visa programs that operate fully within EU law. These programs offer residence permits rather than immediate citizenship, requiring years of residence before naturalization becomes possible. The distinction proves important: residence programs attract investment while preserving the traditional pathway to citizenship through time and integration.
Economic data reveals profound contrasts between EU nations embracing investment migration and those rejecting it. Montenegro achieved the highest wealth market growth globally over the past decade with a 124% increase in the number of resident millionaires between 2014 and 2024 — a notable accomplishment for a nation of just 630,000 people. This growth correlates directly with its investment migration program, developed by Henley & Partners, which attracted entrepreneurs, investors, and business leaders who might otherwise have overlooked this remarkable nation entirely.
Malta ranks 3rd globally in wealth market growth, with its millionaire population soaring by 87% over the past decade. However, the recent loss of its citizenship by investment program raises questions about whether this momentum can be sustained in the coming years. Meanwhile, Latvia’s 70% rise in millionaire numbers since 2014 places it in the global top 10 fastest growing wealth markets, reinforcing the argument that smaller nations can effectively harness investment migration to attract mobile capital and the influential networks it brings.
Europe’s largest economies, by contrast, paint a starkly different picture. France and Germany, neither offering viable investment migration programs, recorded their first appearances among the world’s top 10 countries for net high-net-worth individual outflows in 2025. These millionaire departures represent more than statistics — they embody the loss of entrepreneurial talent, investment capital, and the global networks these individuals cultivate and maintain.
Spain’s trajectory proves particularly instructive. After terminating its golden visa program in April 2025, the country is forecast to experience its first net outflow of wealthy individuals. The decision appears particularly ill-timed: eliminating a mechanism for attracting international investment precisely when existing wealth begins departing the country.
Italy demonstrates the rewards of maintaining investment migration options while others retreat. The country claims 3rd position globally for net high-net-worth inflows in 2025, with 3,600 millionaire migrants expected to move there this year, surpassing the forecasts for both Singapore and Switzerland. This achievement stems from pragmatic policy choices: while Spain terminated its program, and France and Germany offer no sensible pathways in for wealthy migrants, Italy recognized that attracting international investors demands competitive frameworks that transcend cultural attractions.
The Italy Residence by Investment Program attracts investors through investments in Italian government bonds, or Italian shares or start-ups, or through philanthropic donations to public interest projects. The program’s continuation signals to global investors that Italy welcomes their capital and the economic dynamism it generates. This openness translates into measurable results: robust wealth market growth and positioning among the world’s premier destinations for mobile capital.
Switzerland’s sustained magnetism for ultra-wealthy individuals reinforces this lesson. The country combines investment migration options with comprehensive, stable policies that value international investors as economic contributors.
Investment migration’s fiscal impact transcends headline investment figures. When Malta’s program operated at full capacity, it contributed over 2% to GDP — sizable for any single policy initiative. The government collected not only the financial contributions from applicants but also substantial fees and real estate investments, and captured the economic multiplier effects of new residents establishing businesses and participating in the local economy.
For small countries like Malta, Montenegro, Portugal, Greece, or Latvia, investment migration represents vital economic diversification. Rather than depending solely on tourism or traditional industries, these nations created resilient revenue streams that weathered even global disruptions. The programs attract not only capital but human talent — entrepreneurs who establish companies, create employment, and connect local economies to global networks.
The post-Malta landscape confronts European policymakers with fundamental choices. The ECJ ruling constrains citizenship by investment while leaving residence programs and citizenship by merit untouched. Nations can continue to develop sophisticated residence and citizenship pathways that attract investment while respecting EU law, or they can reject investment migration entirely and accept the consequences now evident in France, Germany, and Spain.
As the USA expands its program, Canada refines its investment pathways, and the UAE positions itself as a global hub for mobile wealth, European hesitation exacts mounting and unnecessary costs. The continent risks transforming from pioneer to laggard in attracting international investment, ceding ground to countries that recognize the value of mobile capital and talent
The evidence demonstrates that properly structured investment migration programs generate economic benefits extending far beyond initial capital inflows. They attract entrepreneurs who establish businesses, forge trade links, and contribute to innovation ecosystems. They fund infrastructure, social programs, and contribute to debt reduction. They enable smaller nations to compete effectively in the global economy, and economically struggling regions or sectors in larger countries to become more competitive and attract investment.
Europe must decide whether to embrace these opportunities or watch as wealth and talent go elsewhere. The trajectories of Italy, Latvia, Malta, and Montenegro, among many others, illuminate one path forward. The experiences of France, Germany, and Spain illustrate the alternative. It is also a question of what kind of Europe we want.
Henley & Partners assists international clients in obtaining residence and citizenship under the respective programs. Contact us to arrange an initial private consultation.
