The world has experienced unexpected volatility in light of the global pandemic, which has shaken up the citizenship by investment industry significantly. The uncertainty has only continued into 2021 and has affected people’s decisions about where they ‘choose’ to live.
Now, this level of instability driven by COVID-19, has led to a spike in affluent entrepreneurs and international investors diversifying their domicile portfolios through residence and second citizenship investment in a bid to overcome the limitations and risks of being restricted to a single residence.
Despite borders creating barriers in a pandemic world, the right to freedom of movement is a fundamental right preserved in the laws and constitutions of most countries – and yet despite the pandemic, these states are not rejecting dual citizenship acceptance. According to recent research, there has been a 32% increase in the daily average number of enquiries compared to the first six months of 2020. John Hanafin, CEO for Huriya Private concurred with the research with the traction they’ve been seeing in the market, “We’ve seen a huge upsurge in clients coming to us looking for secondary citizenship and investment opportunities this year. People are looking at the most practical options for both investment and the flexibility of living abroad in structures that make sense for both their lifestyle and portfolio needs, in places that offer incentives and sensible returns. As a multi-family office, we’ve been helping our clients find the right solutions and then take care of everything to make it happen for them as quickly and efficiently as possible. The pandemic has accelerated this market beyond expectation.”
There has been a leap a 192% leap in enquiries from US citizens in 2020 compared to the previous year. Enquiries from Canadians are up 34%, and there have been 29% and 26% more enquiries from UK and French nationals.
Now, more than ever, is the time to bolster the resilience of portfolios to strengthened physical and financial longevity. Alternative residence or citizenship is seen as providing the flexibility and security individuals are seeking considering the pandemic and ongoing geopolitical instability. Having a wide breadth of choice allows for alternative business, career, educational, healthcare, and lifestyle opportunities on a worldwide scale.
The idea of large, multi-generational families all living in the same location is now fast becoming as antiquated and impractical practice, as Hanafin notes, “Domicile diversification allows for investors and their families to broaden their opportunities worldwide. A ‘picking and choosing’ strategy can see a successful Fintech entrepreneur apply for Australia’s Global Talent Independent Visa to obtain permanent residence there. The children have their sights set on studying in Europe or the UK, so they also apply for the UK Investor Immigration Program or the Portugal Golden Residence Permit Program. The retired parents, on the other hand, would prefer to spend time inPortugal, so they could apply for the Portugal Golden Program. Our team is focused on helping our clients navigate these waters across the globe.”
The pandemic has reminded us that we need to take a long-term strategic approach, not make a mad dash to the emergency exit when things go wrong in our current place of residence. Unless a plan and structure is in place, preservation of wealth in today’s high tax economies can still prove very difficult.