For the Wealthy, Citizenship at a Premium | Boston Review

Good in-depth article on investment citizenship:

In Southern Europe, citizenship-by-investment programs are intrinsically tied to property markets that were badly hurt by the 2008 crisis. The bursting of Spain’s real estate bubble left millions of empty homes, plummeting values, and entire ghost cities of half-finished villas. After such bad press, Mediterranean countries have struggled to lure back second homeowners who were essential to the economy (almost 20 percent of the housing stock in Mediterranean Europe is second homes, compared to just 3 percent in Northern Europe). In all of these markets, property developers have been frightened by the growing polarization between Northern and Southern Europe and have urged national governments to respond by courting global elites in place of traditional buyers from Germany, the Netherlands, and Scandinavia. The Brexit vote has only exacerbated this trend by taking UK buyers off the market and complicating the residency status of current British homeowners. Despite the challenges, some in the real estate industry are excited by citizenship-by-investment. Before 2008, they felt that EU-based property markets limited their business to merely well-off European clients; the innovation of citizenship-by-investment allows them to go after the truly global elites.

Those with a crisp new Maltese passport will probably not be getting to know the island very well. Initial residency is easy to fudge. After the wait period is over, newly Maltese citizens can work in Stockholm, enroll their children in heavily subsidized Dutch universities, or use Germany’s universal healthcare system. The selling of citizenship appears to many as a Southern European scheme to profit from the employment opportunities and stability of their Northern neighbors by selling access to stronger job markets and welfare states through their own immigration ministries. Michael Briguglio, a professor at the University of Malta and a former Green Party local councilor, called the country a “hub,” adding that the IIP is meant to attract “certain business people from China, Russia, and certain Arab countries to give them an open door to Europe. It’s a global form of patronage.” This issue is particularly sensitive in Malta, which is intensely Catholic; divorce was legalized only in 2011, and natives have a long history of viewing their island as a Christian entrepôt amidst Muslim trade routes. While the IIP vets criminal records and financial holdings, there seems to be little fear that citizenship-buyers will pose a safety threat. The pressing European worry of radicalization thus seems to apply only to poor migrants, ignoring a long history of economically comfortable and cosmopolitan participants in terrorist organizations.

For small countries, using passports as an asset to be exchanged for cash seems reasonable given a dearth of economic options.

As Southern Europe continues to have tense relations with wealthier EU nations over austerity, many politicians have been forced to cast a wider net to find allies and investors. Cyprus has drawn a large Russian population. China has invested in infrastructure and real estate in Greece and Spain. Portugal even saw the acquisition of a large national bank by its former colony, Angola. Compared to privatizing national industries or providing staging grounds for non-EU companies, selling passports is easy because it is geared toward mobility. It also reinforces the logic that small countries must constantly innovate in order to stay relevant to business opportunities and protect themselves from economic hardship. As Lino Bianco, a Maltese professor and the ambassador to Bulgaria, put it: “Maltese are survivors by circumstances. They turn failures into successes.” Using passports as an asset to be exchanged for cash seems reasonable given a dearth of economic options and a long history of trading, migration, and outside rule by regional powers. Unlike in larger countries, Maltese citizenship has always been negotiable and responsive to wider power struggles on the European continent. The most important thing for the Maltese was to get the best deal possible.

What differentiates citizenship-investors from those who go through a naturalization process is sweat equity. Citizenship-for-sale programs cynically reject the notion of national community, even at a time of rising xenophobia in Europe. Investors can experience citizenship—and all its attendant bonds, prejudices, and heart-stirring emotions—through a bank transfer and a paper booklet while the vast majority of those struggling to migrate must cross deserts, pack into dinghies, live in the shadows, struggle to maintain hope in detention centers, face deportation, study languages and history, and maybe, just maybe—only after many years—stand proudly among their friends and families with their hand on their heart.

Source: For the Wealthy, Citizenship at a Premium | Boston Review

About Andrew
Andrew blogs and tweets public policy issues, particularly the relationship between the political and bureaucratic levels, citizenship and multiculturalism. His latest book, Policy Arrogance or Innocent Bias, recounts his experience as a senior public servant in this area.

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