More super-wealthy Africans are buying foreign residency and citizenship rights, a global advisory firm has said.
Before coronavirus pandemic hit, the billionaires bought additional passports, acquiring permanent residency and citizenship for ease of business travel, to get access to elite education for their children, or to have a second home for leisure.
However, Covid-19 has led to a different need for passports: to access high-quality healthcare, live in countries with better pandemic responses, and potential safe havens to ensure they have a backup plan for the future.
Marios Rafail, the Head of Geneva office for Henley & Partners, a firm that works with countries and individuals on citizenship-by-investment programme says interest is growing from Kenyans, Nigerians, South Africans and Ghanaians.
Over the years, investment migration, which is based on wealth, has become a multibillion-dollar industry.
Investment migration programmes offer residence or citizenship in exchange for substantial investment in a country’s economy, in the form of real estate and infrastructure development, job creation, or government bonds.
The cost ranges from Sh10 million ($100,000) for Antigua, Sh45.2 million (350,000 euros) for Montenegro, Sh142 million (1.1 million euros) for Malta, and Sh388 million (3 million euros) for Cyprus citizenships.
Henley & Partners, which helps wealthy individuals acquire second passports has now opened offices in Lagos, Nigeria, in addition to the two in Johannesburg and Cape Town, South Africa.
The two countries provided about 85 percent of the more than 100 Africans who purchased Henley’s services in 2019, the firm said. South Africa has the highest number of ultra-rich persons in Africa, at 1,033, followed by Egypt (764) and Nigeria (724), according to this year’s Knight Frank’s Wealth Report.
Kenya has the sixth-highest concentration of super-rich persons. There are 42 Kenyans with wealth over Sh3 billion, while those whose net worth is more than Sh100 million are 2,900.
Most Kenyans and Nigerians who seek the firm’s services earn their income in their home country and have no plans to relocate.
These individuals purchase foreign passports to ensure that they have greater options for last-minute medical or business travel or to provide education for their children as Marios tells BDLife.
If you compare 2019 to 2020, has there been an increase in the purchase of second citizenships? How many people are buying?
Exact statistics are not publicly available but I can tell you that it is my sixth year since I established the office in Geneva, and this is the busiest time ever.
Different reasons such as Covid-19, geopolitical tensions, and insecurity in terms of mobility to travel, are all factors that have contributed to this huge increase in demand.
Demand is especially high from Africans in Kenya, Nigeria, South Africa, and Ghana. The concept of citizenship and residence planning is on the top agenda of high net worth individuals (HNWI).
Alternative citizenship remains a safety pillar for potential investors due to different reasons.
What is driving the purchase of alternative passports during Covid-19?
The global pandemic has torn down the possibility of travelling and clients want to have solutions, in case another pandemic comes.
To be clear, this is not about escaping the current pandemic, but being ready for the next one.
What is defining their choice of the country now is heavily correlated to its health system, especially for individuals living in countries with challenged healthcare systems.
Clients are thoroughly checking the number of Covid-19 cases per country before they make their pick.
European Union passports, for instance, grant the applicant and their family unlimited access and settlement freedom throughout the zone.
Which are the top five countries favoured by the rich in the Covid-19 season?
In terms of citizenship, the highest demand always remains for Malta and Cyprus, whilst there is an increased interest for Montenegro (on the waiting list to join the European Union), which requires a lower investment.
In the Caribbean, Saint Kitts and Nevis and Antigua and Barbuda remain on top of the list, especially for clients from Africa and the Middle East.
Do all countries permit dual citizenship?
Countries such as the Netherlands, China, and Kazakhstan do not allow dual citizenship. But most countries have no restrictions on the number of citizenships an individual can own.
During this pandemic, which African countries have been your top clients?
In sub-Saharan Africa, the countries that have increased their interest in additional passports are Nigeria, Kenya, and South Africa. Nigerian and South African nationals represent the biggest percentage of our African portfolio. According to our Geneva office, North Africa is one of the key drivers for demand for our services, namely Morocco, Algeria, and Tunisia.
How many Kenyans so far have bought citizenship or residency through your firm?
This information is not publicly available but during the last three years, we have seen organic growth in terms of the number of applications from Kenya.
Any plans for setting up offices in Kenya?
We invest where we see significant potential. As an example, the recent opening of operations in Nigeria indicates that there is a vast increase in demand for our services. At the moment there are no imminent plans to open an office in Kenya, but this is something that the Group can consider in the future.
Which is the most popular Individual Investor Programme in the citizenship schemes?
The Maltese programme is the most popular and highly-demanded. To get Maltese citizenship, an individual requires about Sh129 million but for a family of four, it would cost Sh155 million.
A significant portion of this amount is non-redeemable because it is a donation to the local economy. In return, the individual has the right to live and work in Malta and the European Union, with visa-free access to 183 destinations in the world including Canada, Hong Kong, Japan, Singapore, Europe’s Schengen Area, the UK, the US, and the United Arab Emirates.
The Maltese passport is the seventh strong passport in the world in passport ranking.
How long does it take to complete the application process and what is required from the applicant?
The programmes take time to be processed. Depending on the country of application, the due diligence process takes four months to 14 months. Part of the process includes financial and criminal evaluations to ensure the money has been earned legally, before the approval of their residency or citizenship.
The applicant has to disclose their net worth and the source of funds, as well as provide police clearance certificates in their country of birth and country of citizenship.
Ms Maina is a luxury consultant based in Paris, France.