At first glance, it may seem like philanthropy and investment migration don’t have much in common, but the truth is far from it. Philanthropy and investment migration go hand in hand, and in many cases, charitable donations are the key to unlocking a citizenship or residency by investment program. To understand how these two issues intertwine, let’s take a closer look at some of the most popular investment migration programs and how philanthropy plays a significant role within them.
Caribbean citizenship by investment programs
Philanthropy’s role is prominent in Caribbean citizenship by investment programs (CIPs). The countries of Antigua & Barbuda, Dominica, Grenada, St Kitts & Nevis, and St Lucia all have functioning CIPs that grant investors citizenship and powerful passports in exchange for an investment in their economy.
Each program has its own investment categories. Real estate investments are available in all of them, while some have business investment options, and St Lucia has a government bond category. However, more relevant to the point, all of them have a charitable contribution option.
By donating an amount to a government ESG fund, a person can obtain a passport and citizenship certificate.
These ESG funds function as a critical factor in the governments’ economy, bringing in unencumbered funds that allow these small nations with limited resources not only to survive, but to thrive. St Kitts & Nevis, for example, used the funds to develop sustainable housing projects for its population at a lower-than-market average cost. Dominica is utilizing nearly US$ 330 million to create the country’s first international airport that will assist development of the nation’s entire economy.
Even in times of crisis, Caribbean CIPs create new funds to deal with the aftermath of catastrophes such as hurricanes or the COVID pandemic. Investors benefit from these funds as they provide them with the lowest possible price point to obtain a citizenship without any prior need to reside or visit these Caribbean nations. It is a win-win situation for everyone involved.
Not only that, but due to the comprehensive documentation involved, investors of certain nationalities and tax residencies can use these donations as charity write-offs for tax purposes. This, of course, depends on the country of origin and its tax law, so prior consideration and configuration are key. But if doable, an investor can write off at least US$ 100,000 in taxes while also obtaining a second citizenship.
Philanthropy plays a significant role in Caribbean CIPs, be it streamlining their programs, keeping the price competitive and within reach, or developing countries that otherwise have low resources.
Vanuatu
Another popular investment migration program that has a philanthropic basis is Vanuatu’s citizenship by investment program. Vanuatu actually has more than one citizenship by investment program, but the Development Support Program (DSP) is based entirely on a philanthropic donation.
The DSP requires applicants to make a donation to the Development Support Fund for the following amounts: US$ 130,000 for a single applicant. US$ 150,000 primary applicant and spouse. US$ 165,000 primary applicant, spouse and one child. US$ 180,000 primary applicant, spouse and two children. US$ 10,000 per additional family member who joins the application. Being a smaller Pacific nation that is low on natural resources and focuses more on tourism and its services sector, economic diversification and development are essential for Vanuatu. The DSP helps achieves this through injecting much-needed unencumbered funds into the economy. Citizenship by investment applicants can help the country achieve this through their cash influxes through the DSP.
Going hand in hand
Philanthropy and investment migration align perfectly, as the premise of both focuses on benefit. Countries want to benefit their population through the use of unencumbered foreign funds, and investors want to obtain a second citizenship or residency. This ideal situation created the perfect environment for citizenship and residency by investment programs to base their investment categories on acts of philanthropy, and everyone involved is a winner. To know more about philanthropy within investment migration and how you can take part, contact us today to speak with an expert.
