Exploring the current RCBI landscape worldwide: A beginner’s guide

By Marta Lillo

The residency and citizenship by investment (RCBI) programs evolve in aspects such as global interest, regulation and requirements, regional competition, and diversification of alternatives.

What are the differences between residency and citizenship programs?

Countries launch residency visas and citizenship programs to boost their economies by attracting foreign investment, creating jobs, addressing skill shortages, and enhancing competitiveness.

Residency-by-investment (RBI) programs allow individuals to obtain residency in another country by investing specific funds in certain investments. These investments could be real estate, funds, or company stocks. By meeting the requirements of the RBI program, applicants receive residency rights for a set number of years and work permits. However, it's important to clarify that RBIs only grant residency, not citizenship or passports – but some offer routes to permanent residency then citizenship.

Arguably, the most popular RBI programs worldwide are the European golden visas and the United State’s EB-5 investor visas.

On the other hand, citizenship-by-investment (CBI) programs are designed for foreign applicants seeking citizenship in another country. Like RBI, CBI programs offer a variety of investment options, such as real estate, state debt purchase, and direct donations, in exchange for citizenship. It's important to note that CBI programs grant citizenship and, therefore, passports, but it differs from a country's naturalization process. The most popular citizenship programs globally are the Caribbean CBI alternatives.

While many RBI programs are renewable for several years, few offer a pathway to CBI or naturalization options. It's also worth noting that some CBI programs are a continuation of RBI programs, while others run separately from the residency visa offered by the same country.

Pros and cons of residency and citizenship by investment programs 

Both types of programs offer expected benefits, including varying degrees of international mobility depending on the investor's preferred destination after obtaining a residency visa or citizenship. They are also considered robust asset diversification options. In the case of RBI programs that offer a pathway to citizenship, applicants get better mobility, access to social services, and the added benefit of political and voting rights.

They are also quickly affected by the changes in policies and regulations which are subject to political and economic conditions. These changes can negatively impact investors' long-term plans or their eligibility for residency or citizenship. In some cases, the due diligence procedures can be time-consuming and intrusive. Some residency by investment programs also receive criticism for their restrictions on certain types of work or professions allowed under the visas.

Developing trends in the RCBI landscape

These programs witness dynamic changes and updates on a global scale. The most recent are:

1. Wealthy investors want to diversify their portfolios with investor visas and citizenship

There was a surge in interest in investor visas (RBIs) after the pandemic because the number of high-net-worth individuals (HNWIs) from different regions is increasing, and they are looking for residency and citizenship options that allow them freedom of movement and safety.

The number of HNWIs worldwide is rising, with China and India showing significant growth. According to Knight Frank's The World Wealth 2023 report, there were 69.5 million HNWIs and 579,000 ultra-HNWIs in 2022, up 2.9% and down 3.8%, respectively, compared to 2021.

In China, the number of super-rich individuals has increased tenfold since the beginning of the new millennium, as the 2023 Wealth Henley report reported. China now has 2,250 cent millionaires (with fortunes of $100 million and up) and 285 billionaires, not to mention almost 800,000 high-net-worth Chinese (with means of $30 million and up). This makes it second only to the US regarding the concentration of wealthy individuals. Therefore, China has become a prime market for RCBI programs worldwide.

India is the world's fifth-largest economy, and the number of ultra-high-net-worth individuals (UHNWIs) with a net worth exceeding $30 million is expected to increase from 12,069 in 2022 to 19,119 individuals by 2027, according to Knight Frank's report. Meanwhile, India's billionaire population is projected to reach 195 individuals in 2027 from 161 in 2022.

HNWIs are also looking for ways to protect their assets and travel more freely, even amid political and economic uncertainty. One popular alternative, "Plan B," is to secure residency or citizenship in another country; they see these programs as an exit strategy in case of political conflict or economic downturns in their home countries. In addition, they can access different tax regimes and greater diversity in their investments, which is particularly appealing to investors looking to protect their wealth.

One group of investors increasingly interested in these programs is the crypto community. As cryptocurrency regulations become more stringent in some countries, these individuals are looking to secure residency or citizenship in more crypto-friendly nations. It can provide them with a safety net in case they need to relocate.

2. Regulation and requirements for investor visas are changing

Many countries reevaluate their investor visa programs for security and economic reasons, some making them stricter while others are flexing their conditions.

Recently, the European Union (EU) has taken steps to regulate its RCBI industry by pushing for stringent access requirements and provisions on its member countries. The U.S. is also engaged in discussions with several countries to encourage them to improve their CBI access options.

For example, the U.S. has reportedly required Caribbean nations to update their CBI programs, which investors sometimes use as stepping stones to gain access to the U.S. and EU, and make their due diligence process more stringent. There are reports that the EU also asked several Caribbean nations that rely on their CBI programs for economic development to adopt more severe action; for example, St Kitts and Nevis introduced a new investment option, doubled its CBI investment threshold, and extended lower threshold offers while implementing personal interviews for citizenship applicants, a measure adopted by Grenada and Dominica too.

3. Asia and the Middle East are adding their own residency and citizenship programs

Asian countries are increasing competition to attract investors and adopting friendlier immigration policies to attract wealthy individuals and professional talent.

The UAE residency investor visa quickly became a popular program in the Middle East and North Africa (MENA) region, granting foreigners the right to live, study, and work.

In Southeast Asia, Indonesia launched a golden visa program, while in Central Asia, Kazakhstan is overhauling its immigration policy to attract skilled migrants and investors. In West Asia, Saudi Arabia introduced a "visiting investor" visa, while Kuwait and Bahrain are exploring long-term investor visas.

Separately, Singapore increased the investment threshold for its Global Investor Program; Thailand revamped its Elite Visa; Hong Kong resumed its RBI program with changes; and South Korea extended its real estate investment visa.

Although Asian countries dominate this trend, other nations try to find a place in this competitive landscape. Malta launched a Startup Residence Program to turn the country into a hub for non-EU startups. The government is particularly interested in attracting startups in specific industries, including manufacturing and industrial.

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