Q. I am a 40 year old South African who has been working in Vietnam for the last three years. I have been an expat for 10 years and have about 40% of my wealth sitting in South Africa; and the rest is held offshore. My contract with my current company will come to an end in 22 months’ time. I am going to stay international after my contract expires, and I’m interested in permanently immigrating to another country. I consider myself to be a relatively high net worth individual, and have been told that certain countries would offer me permanent residence in exchange for investment into specific projects and offshore investments. Is this this case? If so, could you explain more?
Sven Roering, Managing Partner at Tenzing Pacific Investment Management, advises:
A: Indeed, it would be possible to obtain residency in a country through international investment into designated projects within that country. Many governments, in the quest for attracting foreign investment, have instituted programs whereby foreign citizens invest into offshore projects designated by the state with the express purpose that these funds will be used to create jobs – usually 10 or more – and contribute to the overall economic well-being of the region.
You will also be pleased to know that, as a South African citizen, there is a service run by a company called Cashkows which will assist you with full financial emigration from South Africa (including your tax returns) while you are living offshore.
Popular programs include:
- The USA’s EB-5 program
- Portugal’s Golden Visa
- Australia’s provisional investor and investor retirement visas
- Additionally, many European nations offer residency in exchange for purchasing a certain amount of government bonds
Since you are an English speaker, I will provide brief details of the US EB-5 program as well as the Australian provisional investor and retirement visas.
US EB-5 program
The US EB-5 program allows an international investor to qualify for immigration through a $1million investment into a commercial enterprise in the United States. If the investment is made into a targeted employment area (an area suffering from considerable unemployment), the minimum investment could drop to $500,000. Usually you would be required to invest into a property development or, in some cases, a business center.
Being the US, the process can be quite stringent, and you will be given a ‘conditional’ green card upon initial investment, which will be upgraded to an ‘unconditional’ green card. The unconditional green card gives you permanent residency – i.e. the rights belonging to all US citizens except for the right to vote (and who would want that anyway?) – approximately two years after your initial investment. You would be able to apply for citizenship after five years.
A worthwhile project set aside for this specific program is the Brooks City Base in San Antonio, Texas. Here, an old air force base is being converted into a community with apartment complexes and hotels. A company facilitating these investments from Southeast Asia is Ironwood Advisors (based in Hong Kong) who make trips to see investors in Vietnam on a regular basis.
Australia’s provisional investor and investor retirement visas
Australia has two similar programs to the US EB-5 program, one designed for retirees (aged 55 or older); and one for individuals 45 years of age and younger.
Australia’s provisional investor visa offers a gateway to permanent residency for international investors. After a minimum of two years after your initial investment, you would be eligible to apply for a permanent business skills visa. You would have to prove that you are able to invest 1.5 million AUD within a reasonable amount of time into a designated investment. The big bonus would be that your family would be able to accompany you to Australia, and they would have work and study rights.
Australia’s investor retirement visa would require you to be 55 years or older, have no dependents, and you would need to transfer 750,000 AUD to Australia within two years. You would also need to prove that you would have access to net income of at least 65,000 AUD per year. I couldn’t find any information relating to how this would provide a path to permanent residency, but you would be able to extend the visa after the initial four-year term upon proving that a designated investment of 200,000 AUD can be maintained.
The most important consideration about the programs discussed above is that these are not offshore investments in a traditional sense. What I mean by this is that when you invest the required capital, you can’t expect an annual return, with the option of selling and realising profits whenever you please. The liquidity of many of these projects is often ambiguous. You are trading a certain amount of capital with a state in exchange for residency and a path to citizenship. You will need to approach this ‘investment’ with the mindset of residency first; with returns on investment being secondary.