By Moustafa Daly
In the first half of 2023, the UAE Emirate of Dubai reported a 52% increase in the number of golden visas issued to foreign investors, per recently released government figures.
The UAE golden visa, launched in 2019 and quickly becoming the largest program of its kind in the Middle East and North Africa (MENA) region, grants foreigners the right to live, study, and work in the country for periods ranging between five and 10 years in exchange for an investment of AED 2 million ($544,515) or more. Other categories that qualify candidates for the golden visa are notable scientific, academic, or artistic achievements.
“The UAE as a whole continues to attract both capital and talent, and therefore instruments such as Golden Visas are on the upsurge,” explains Dominic Volek, Dubai-based group executive committee member and group head of private clients at Henley & Partners.
The inflow of foreign investment in the UAE isn’t limited to Dubai.
“Also, other Emirates like Ras Al-Khaimah are seeing strong growth for inbound investors with a rise of 35% in holding companies registered in Ras Al-Khaimah in the first eight months of 2023, compared to the same period of last year,” explains Volek. “Abu Dhabi Global Market (ADGM) also just posted a record growth in H1 2023 with 102 asset managers, comprising investment firms and hedge funds that have established themselves in this fast growing financial hub.”
The surge of interest in golden visas, while pronounced in the UAE, can be seen across the globe in the post-pandemic era. Anticipating similar global events that could potentially restrict their movement, global investors and high-net-worth individuals (HNWI) are increasingly pursuing residency rights in other regions and countries to guarantee unrestricted access to their preferred destinations.
The golden residency and citizenship by investment industry is having a record-breaking year
With a few exceptions, successful residency and citizenship by investment (RCBI) programs typically offer applicants with non-visa access to desirable developed-world destinations, most prominently the United States and the European Union.
In the EU, however, the tides might be shifting for the industry as the union’s official institutions attempt to restrict and regulate the RCBI industry to mitigate potential security risks. On a country level, golden visa programs in the continent are causing property prices to surge in tourist hotspots, crowding out locals and sometimes causing popular backlashes.
Portugal is the place where this is most noticeable. Until this year, the European country ran one of the continent’s most successful golden visa programs before a housing crisis in the capital city of Lisbon caused the government-majority parliament to propose ending the real estate option of the golden visa – which is now in its final stages of approval by the Portuguese Parliament.
Ironically, the move to end the golden visa in Portugal has driven application volume to record levels in 2023, with global investors racing to get their foot in the door, so to speak, before the popular and relatively straightforward real estate option is scrapped.
This is evident by the numbers; since the program’s 2012 launch, over 12,000 principal applicants have received the golden visa. However, in the first half of 2023 alone, more than 1,000 main applicants were approved to obtain it.
If this trend continues through December, 2023 will be the most successful year for the program since 2014, when over 1,500 golden visas were issued to main applicants.
Another popular golden visa destination inside the EU is Greece, which, until 2023, made the visa available to investors who purchased property worth €250,000 or more, among other routes.
Responding to an anticipated surge in housing prices potentially caused by foreigners’ purchases, the Greek government decided to hike the cost of the visa for touristic host spots, raising the threshold to €500,000 in Athens, Mykonos, Santorini and the Municipality of Thessaloniki – while keeping the €250,000 in other areas.
Much like Portugal, the news of the anticipated price hike in Greece caused a surge in application volumes since the end of 2022 before the threshold increase came into effect in August 2023.
As per government figures, real estate golden visa applicants soared to nearly 4,000 in the first half of 2023, compared to less than 1,500 in the same period last year. The total revenue reported by the Greek authorities in that period surpassed €1 billion – marking the program’s most lucrative year.
The Caribbean citizenship by investment programs face an uncertain future
The very concept of citizenship by investment (CBI) was introduced by St Kitts & Nevis in 1984, making it the oldest CBI program anywhere. St Kitts & Nevis, along with other island nations of the Caribbean like Grenada, St Lucia, Dominica, and Antigua and Barbuda, soon realized the immense economic benefit that establishing such programs would bring to their economies.
While these nations have well-developed infrastructure and high living standards, the main selling points of their CBI programs continue to be visa-free access to the Schengen Area, and, in the case of Grenada, the added benefit of qualifying for E-2 investor visas in the U.S.
These programs still run actively. However, they recently began facing increasing U.S. and EU demands to comply with stricter due diligence, raise investment threshold, and collaborate with law enforcement against malicious individuals or those who pose security risks to the EU. The United Kingdom has already suspended the visa-free agreement with Dominica, citing security risks.
Official government stats on the programs in 2023 are yet to be released. St Lucia, however, has recently released its 2021-2022 figures showing a record-breaking number of applications in that period reaching 583 applications.
However, stricter due diligence, higher thresholds, and uncertainty about the program’s future could add up to a slow 2023 for these programs. These Caribbean nations, however, heavily rely on the programs to fund their development agendas – meaning that an abrupt halt or revocation of visa-waiver agreements with the EU could have dire economic consequences for them.
So far, the EU and U.S. seem willing to work with these nations to ensure the situation doesn’t escalate this far. Both have made similar demands of the Caribbean nations to ensure the programs are not abused – and they have shown their willingness to comply.
Despite unclarity in the Caribbean citizenship by investment programs, the global RCBI industry continues to have one of its most successful years on record, with the trend showing no signs of abating in the near future.
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