Geopolitics

COVID-19 Travel Bans Are Boost For 'Golden Passport' Market

The super rich are buying residency papers and passports from places like Cyprus and Vanuatu to be able to travel — despite quarantines — for health reasons, business or pleasure.

Empty passport control in Munich last month
Julien Bouissou

After tax havens, coronavirus havens. Since the beginning of stay-at-home orders, millionaires and billionaires around the world have been buying residence permits and passports at high prices to escape the COVID-19 pandemic or their country's failing health infrastructure.

Konstantin Kaminsky, associate director of Astons, which offers citizenship "solutions' from London, says his phone has been ringing non-stop for the past four months: "The wealthy in poor countries have found themselves stuck at home in the midst of an epidemic, even though they are used to seeking treatment abroad."

Others were not reassured by the health response in their countries. "Some American clients have told us that they don't want to be in the United States when the next outbreak occurs," said Paddy Blewer, a spokesperson for Henley & Partners. It's not so much the suspension of commercial flights that is a problem but the closure of borders to foreign nationals due to quarantine orders. In these circumstances, a private jet is of no help. Certain travel documents must be purchased, a plan B reserved for the wealthiest.

In the citizenship market, passports exist for all client profiles. Rankings measure their "power," i.e. the number of countries they're allowed to visit without a visa. During the epidemic, the position of the U.S. — whose citizens can no longer travel to Europe — plummeted, while that of Australia, relatively unaffected by the pandemic, rose.

The Vanuatu passport offers one of the best values for money. Delivered by the postal services in just one month for around $152,590, it is one of the least expensive and quickest to obtain.

Such a passport alternative makes it easier for American business professionals to travel to China at a time when relations between the two countries are steadily deteriorating, and it saves time for rich citizens of poor countries by avoiding lengthy visa application procedures. The problem is that it does not allow a person to reside in a country for more than six months, a major drawback when trying to escape the coronavirus epidemic.

Residence permits are therefore the most popular, especially those sold by Cyprus. (Malta's quotas have already been reached.) The Mediterranean island is not far from the Middle East, where many potential customers live, and out of a population of 1.2 million, only 1,000 people have tested postive for COVID-19. Hospitals have never been overcrowded.

Every new crisis offers a business opportunity.

The residence permit, which can be converted into a European passport after just a few months, is exchanged for an approximately 2 million-euro investment in real estate. "During the quarantine, our consultants in Cyprus would take our clients, who were stranded abroad, on smartphone tours of luxury villas," says citizenship consultant Kaminsky.

Photo: Henry Thong

In the "citizenship through investment" industry, every new crisis offers a business opportunity. "With the COVID-19 pandemic and the economic downturn in Lebanon, the demands have multiplied," acknowledges Tarek Kaoukji, founding president of Sununu Advisors. "Families who had been thinking for a long time about acquiring another nationality have finally made up their minds."

Clients want to be discreet at a time when economic patriotism is celebrated in many countries in the midst of a health crisis. In Jordan, Kuwait and elsewhere, Sununu Advisors are in contact with potential clients through partnerships with banks. Small committee meetings are organized, during which diplomats come to praise the merits of their country. The agency then puts its clients in contact with lawyers from each host country, who are "often former diplomats or civil servants."

Citizenship is acquired like risk insurance: better to have one in case of a problem. "Those who buy citizenship are often risk professionals," said Paddy Blewer, a spokesman for Henley & Partners. "But the pandemic has only increased the value of a second passport." In many cases, clients who purchase a passport will not live in the country in question, industry professionals say.

"Second citizenship is more than a lifestyle. It is the guarantee of being able to make choices to protect the safety of yourself and your family. Having independence from political, economic, social and environmental factors in your home country allows you to have options available to you whenever you might need them." This is a selling point that the Netherlands has taken up, offering a "golden visa" for an investment of around $1,467,000 in a start-up company, with the possibility of becoming a citizen after five years.

"A war about to break out? An unstable political situation? Radical economic reform? Thanks to the residence permit, you can go to the airport with your family and live in your second home with peace of mind," praises Orange Visas, the partner agency of the Dutch immigration services. And it doesn't matter if some countries, such as India, prohibit their citizens from having dual nationality. "They usually leave their passport in a third country, at their lawyer's office in Dubai, for example, and pick it up or have it delivered on the way," says one expert on the subject.

The Caribbean islands, faced with falling tourism revenues due to quarantine, have lowered the price of their passports and are trying to attract "citizenship investors' by other means.

Strangled by debt, the island of Saint Lucia recently issued zero interest rate bonds, but with a passport offered. If the subscriber agrees to invest $250,000 for at least six years, Saint Lucia even offers a second nationality to the person of his or her choice. Abandoned by tourists, the island of Barbados is trying to attract teleworkers who are stuck at home. It offers a one-year visa to those earning more than $50,000 a year.

At the beginning of 2018, the Organization for Economic Co-operation and Development (OECD) warned about the "golden passport" and visa system. It was concerned about the practice of evading controls on the automatic exchange of data, a mechanism put in place by states to combat fraud. With a second passport, it is in fact possible to avoid checks on the amounts held by a foreigner. In 2014, the U.S. had also asked the island of Saint Kitts and Nevis, accused of having given a passport to an Iranian seeking to escape U.S. sanctions, to tighten the conditions for issuing it.

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Thousands of migrants in Del Rio, Texas, on the border between Mexico and the U.S.

Hannah Steinkopf-Frank, Bertrand Hauger and Anne-Sophie Goninet

👋 Сайн уу*

Welcome to Friday, where the new U.S.-UK-Australia security pact is under fire, Italy becomes the first country to make COVID-19 "green pass" mandatory for all workers, and Prince Philip's will is to be kept secret for 90 years. From Russia, we also look at the government censorship faced by brands that recently tried to promote multiculturalism and inclusiveness in their ads.

[*Sain uu - Mongolian]

🌎  7 THINGS TO KNOW RIGHT NOW

• U.S. facing multiple waves of migrants, refugees: The temporary camp, located between Mexico's Ciudad Acuña and Del Rio in Texas, is housing some 10,000 people, largely from Haiti. With few resources, they are forced to wait in squalid conditions and scorching temperatures amidst a surge of migrants attempting to cross into the U.S. Meanwhile, thousands of recently evacuated Afghan refugees wait in limbo at U.S. military bases, both domestic and abroad.

• COVID update: Italy is now the first European country to require vaccination for all public and private sector workers from Oct. 15. The Netherlands will also implement a "corona pass" in the following weeks for restaurants, bars and cultural spaces. When he gives an opening speech at the United Nations General Assembly next week, unvaccinated Brazilian President Jair Bolsonaro will defy New York City authorities, who are requiring jabs for all leaders and diplomats.

• U.S. and UK face global backlash over Australian deal: The U.S. is attempting to diffuse the backlash over the new security pact signed with Australia and the UK, which excludes the European Union. The move has angered France, prompting diplomats to cancel a gala to celebrate ties between the country and the U.S.

• Russian elections: Half of the 450 seats in Duma are will be determined in today's parliamentary race. Despite persistent protests led by imprisoned opposition leader Alexey Navalny, many international monitors and Western governments fear rigged voting will result in President Vladimir Putin's United Russia party maintaining its large majority.

• Somali president halts prime minister's authority: The decision by President Mohamed Abdullahi Mohamed marks the latest escalation in tensions with Prime Minister Mohamed Hussein Roble concerning a murder investigation. The move comes as the Horn of Africa country has fallen into a political crisis driven by militant violence and clashes between clans.

• Astronauts return to Earth after China's longest space mission: Three astronauts spent 90 days at the Tianhe module and arrived safely in the Gobi desert in Inner Mongolia. The Shenzhou-12 mission is the first of crewed missions China has planned for 2021-2022 as it completes its first permanent space station.

• Prince Philip's will to be kept secret for 90 years: A British court has ruled that the will of Prince Philip, the late husband of Britain's Queen Elizabeth who passed away in April at 99 years old, will remain private for at least 90 years to preserve the monarch's "dignity and standing."

🗞️  FRONT PAGE

With a memorable front-page photo, Argentine daily La Voz reports on the open fight between the country's president Alberto Fernández and vice-president Cristina Kirchner which is paralyzing the government. Kirchner published a letter criticizing the president's administration after several ministers resigned and the government suffered a major defeat in last week's midterm primary election.

#️⃣  BY THE NUMBERS

€150

An Italian investigation uncovered a series of offers on encrypted "dark web" websites offering to sell fake EU COVID vaccine travel documents. Italy's financial police say its units have seized control of 10 channels on the messaging service Telegram linked to anonymous accounts that were offering the vaccine certificates for up to €150. "Through the internet and through these channels, you can sell things everywhere in the world," finance police officer Gianluca Berruti told Euronews.

📰  STORY OF THE DAY

In Russia, brands advertising diversity are under attack

Russian sushi delivery Yobidoyobi removed an advertisement with a Black man and apologized for offending the Russian nation, while a grocery chain was attacked for featuring an LGBTQ couple, reports Moscow-based daily Kommersant.

❌ "On behalf of the entire company, we want to apologize for offending the public with our photos..." reads a recent statement by Russian sushi delivery Yobidoyobi after publishing an advertisement that included a photograph of a Black man. Shortly after, the company's co-founder, Konstantin Zimen, said people on social media were accusing Yobidoyobi of promoting multiculturalism. Another recent case involved grocery store chain VkusVill, which released advertising material featuring a lesbian couple. The company soon began to receive threats and quickly apologized and removed the text and apologized.

🏳️🌈 For the real life family featured in the ad, they have taken refuge in Spain, after their emails and cell phone numbers were leaked. "We were happy to express ourselves as a family because LGBTQ people are often alone and abandoned by their families in Russia," Mila, one of the daughters in the ad, explained in a recent interview with El Pais.

🇷🇺 It is already common in Russia to talk about "spiritual bonds," a common designation for the spiritual foundations that unite modern Russian society, harkening back to the Old Empire as the last Orthodox frontier. The expression has been mocked as an internet meme and is widely used in public rhetoric. For opponents, this meme is a reason for irony and ridicule. Patriots take spiritual bonds very seriously: The government has decided to focus on strengthening these links and the mission has become more important than protecting basic human rights.Russian sushi delivery Yobidoyobi removed an advertisement with a Black man and apologized for offending the Russian nation, while a grocery chain was attacked for featuring an LGBTQ couple, reports Moscow-based daily Kommersant.

➡️ Read more on Worldcrunch.com

📣 VERBATIM

"Ask the rich countries: Where are Africa's vaccines?"

— During an online conference, Dr. Ayoade Olatunbosun-Alakija, of the African Vaccine Delivery Alliance, implored the international community to do more to inoculate people against COVID-19 in Africa and other developing regions. The World Health Organization estimates that only 3.6% of people living in Africa have been fully vaccinated. The continent is home to 17% of the world population, but only 2% of the nearly six billion shots administered so far have been given in Africa, according to the W.H.O.

✍️ Newsletter by Hannah Steinkopf-Frank, Bertrand Hauger and Anne-Sophie Goninet

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