The Positive Impact Citizenship by Investment has on Nations

Around a dozen countries offer Citizenship by Investment (CBI) Programmes, an initiative that offers the opportunity to legally acquire a new nationality in return for an investment in the economy of the host country.??

CBI is a legitimate response by governments with the need to raise revenue through direct foreign investment which often makes a significant difference to the development of their country. These initiatives are a valid strategy to change their economic landscape.??

The reasons why these countries offer these programmes are so much more complex than boosting their economies, and in this article, we will explore the many ways CBI has positively affected these nations.???

"The beauty about the Citizenship by Investment programme is that it really is a win-win solution for both the investor and the host country. The due diligence process allows countries to know exactly who the investors are that are investing in their countries and the direct contribution to the government enables these small nations to grow sustainably without international aid and funds can build roads, schools and hospitals which benefit citizens," says Micha Emmett, CEO of CS Global Partners.?

?Here are the following key areas that have been positively impacted by CBI programmes:

Economic Growth?

Funds raised by these programmes have had a sizeable impact on economic activity in CBI countries like Dominica and St Kitts and Nevis, which has facilitated debt repayment and spurred economic growth. This, in turn, has led to less reliance on international aid.??

For example, St Kitts and Nevis has one of the strongest and fastest recovering economies in the region due to its sensible management of the pandemic.??

According to the IMF, “St. Kitts and Nevis entered the Covid-19 pandemic from a position of fiscal strength following nearly a decade of budget surpluses. A significant part of the large CBI revenues was prudently saved, reducing public debt below the regional debt target of 60 percent of GDP and supporting the accumulation of large government deposits.”?

The nation’s 2022 budget has propelled the growth, keeping the country moving in the right direction with visible enhancements in its citizen's and residents’ standard of living. An increase in strategic and direct investment translates into infrastructural development and the strengthening of institutions. These important projects are substantially funded by the nation’s CBI programme.??

Sustainable Infrastructure??

Sustainable infrastructure is a key enabler of economic and social development and environmental sustainability. Investing in quality infrastructure contributes to economic and employment growth, enhances productivity, and facilitates international trade.?

Furthermore, sustainable infrastructure also enhances the quality of life for citizens and helps protect vital natural resources and the environment.?

Dominica is the perfect example of a nation that is working relentlessly at building the world’s first climate-resilient nation by focusing on sustainable infrastructure capable of withstanding natural disasters. Climate-resilient infrastructure includes schools, houses, hospitals, health care centres, emergency shelters, roads and bridges.??

The country is also constructing a Geothermal Power Plant, which will significantly lower electricity costs in Dominica and increase the share of renewable energy in the country’s energy mix from 25 to 51%, reducing greenhouse gas emissions by 38,223 tons of CO2 per year.??

While big countries talk about protecting their citizens against climate change, Dominica is taking action. Its government is using funds from its prestigious CBI Programme to fund these projects.??

Eco-tourism?

Many CBI nations offer government-approved real estate investment opportunities, which include luxury hotels and eco-lodges. The CBI programme of Dominica?has this option which has become popular with?savvy investors looking to diversify their property portfolios.?

These Caribbean nations are popular destinations for travellers looking for adventure, luxury, nature, wellness, romance, or those looking to unplug from their daily lives.???

St Kitts and Nevis has enjoyed a thriving cruise sector for several years. Prior to the global health crisis, the nation witnessed the arrival of one million cruise passengers for two consecutive years and had been hailed a "marquee destination" by the Florida-Caribbean Cruise Association.?

Investment into the cruise sector has only contributed further to its success. The construction of Port Zante in St Kitts and Nevis has enabled more ships to dock simultaneously, bringing more people to the islands, which in turn supports tourism stakeholders and the greater economy. Funds from the CBI Programme contributed to the project.??

Dominica is in the process of constructing a new international airport expected to bring in more flights from Europe and North America. In late 2021, American Airlines announced the expansion of its daily service to the island and talks of increasing connectivity with Air Canada are also on the table. The new flights "will be a major factor in establishing better relationships with US tour operators and travel agents, which will result in more business for the hoteliers and service providers in Dominica," said Colin Piper, CEO and Director of Tourism at the Discover Dominica Authority. ?

Employment Creation?

Job creation and economic growth are directly related because the more people work the more the economy becomes stable.??

The infrastructure projects funded by CBI programmes require construction, which creates many direct and indirect employment opportunities.??

The real estate projects offered by CBI programmes lead to an increase in employment, from the construction of the projects to the daily operations once opened. Furthermore, new businesses open to supporting the influx of tourists employ more people, such as restaurants, souvenir stores, spas, tour guides and operators, and so much more.??

Long-lasting Effects?

All of these key areas lead to long-lasting economic effects, and a better standard of living for citizens and residents.???

Citizenship by Investment programmes has been crucial in funding projects that make reaching development goals possible. These programmes constitute a creative and valid strategy to change the economic landscape. ?