Dual citizenship has value in the African context – especially for Africans wishing to take advantage of opportunities within the continent and abroad.
Holding the passport of another country can open opportunities for business, education, healthcare and visa-free travel for investors and their families, according to Monarch&Co, which will present at the upcoming Investment Agenda, being held in Johannesburg on 20 October, with the theme “No man is an island”.
According to statistics, it is estimated that only around 1% of the world’s population have two or more passports, making dual citizenship an exclusive privilege. While in the past it was only possible for people to attain dual citizenship through their ancestry or emigration, many countries have now made it possible for applicants to gain residency or citizenship through various investment programmes without ever having to emigrate.
By making a substantial investment into either a business venture or the purchase of real estate, investors can apply for residency and/or citizenship in a foreign country.
James Bowling, CEO of Monarch&Co, says that investors are particularly interested in obtaining citizenship in countries that are members of the European Union (EU). This is largely due to the benefits afforded to EU citizens including right of free movement, settlement and employment across all EU member states.
While Bowling agrees that the EU offers unparalleled opportunity, other countries can offer similar and/or different benefits that may better suit other investor requirements. These countries can include the US, Grenada and Antigua & Barbuda. Therefore, the choice of country really concerns the primary reason for investment, he explains.
Bowling highlights five advantages of gaining dual residency and/or citizenship:
- A lifestyle hedge – The lifestyle benefits that investors could reap include access to better basic services such as healthcare, education, security and transport.
- A financial hedge – A hard currency investment is a good currency hedge. “Many are looking for investment options that allow them to financially hedge against future economic uncertainty in their home country. Some of the programmes offer investors returns of up to 6,5% as well as buy-back guarantees once they qualify for citizenship – allowing investors to earn returns in foreign currency – these countries include Grenada and Antigua and Barbuda.
- Unrestricted travel – Freedom of travel is one of the major benefits of these programmes. “Many of our clients incur huge travel inconveniences when travelling abroad owing to the conditions set on them by virtue of the passport that they carry. Visa applications are both costly and time consuming and generally an irritating nuisance. Through residency and citizenship programmes, investors can gain travel benefits through obtaining another citizenship that has fewer travel restrictions and visa requirements,” says Bowling.
- Tax breaks – Bowling points out that by gaining a second citizenship, investors are also able to enjoy tax breaks as well as the possibility of improved personal and corporate tax exposure. “The extent of these benefits would depend on the new jurisdiction’s offering and incentives as well as where the client makes their primary tax residence.”
- Family security – Investors who are looking for better schooling opportunities for their children, a safe environment in which to raise their families, or just a better quality of life, are attracted by the benefits of dual citizenship.