SPECIAL REPORT “To be born English, is to win first place in the lottery of life”- Cecil Rhodes. These words spoken at the height of the British Empire; clearly emphasise how an individual’s nationality, defined one’s role and the opportunities available to him. Nationality was considered to be a sacred allegiance, a privilege, one that could never be changed or altered and could only be taken away by the government.
Today, however the concept of citizenship has evolved, it is considered more as a property of the individual holder, one with which he can choose to do as he please, to keep or surrender.
Some EU (European Union) nations, now allow non EU citizens to purchase an EU citizenship/passport under the cover of FDI (Foreign Direct Investment) rules and regulations. A move that has surprised many, especially fellow members, who consider this as counter productive to the checks in place to tackle rising immigration and may go as far as to threaten the very stability and structure of the EU.
The economic crisis of 2008 rattled most of Europe. Property markets and prices crashed, banks with large number of NPA (Non Performing Assets) closed down. Many Europeans, heavy in debt, lost their jobs along with their bank savings. Bail out funds and other international financial assistance brought with it severe austerity measure compulsions. Governments had to raise taxes, reduce public sector expenses, remove subsidies on fuel, and withdraw pension and welfare schemes.
Strapped for funds, many nations passed legislations allowing for fast tracking citizenships to those who bring in much needed capital to the country, giving rise to the phenomenon of Golden Visa and fast track passports.
Under this scheme any non European investing a certain amount of capital would be provided with a Golden Visa, a permanent residency permit, allowing him to travel, live, study and work anywhere within the EU and on completion of a certain time period apply for citizenship. The scheme also allows him to include his family members and loved ones for a nominal fee.
Investments can be made in different forms, capital deposits to banks, bonds and shares acquisition or by purchasing real estate or an existing business in the country.
Real estate and property is seen by many as the most lucrative investment option, anticipating appreciation in prices once the economy stabilizes and improves. Portugal and Spain have set a minimum limit of 500,000 Euros investment in real estate. Malta is the most expensive at 650,000 Euros while more affordable options lie with Cyprus at 300,000 Euros, Greece at 250,000 Euros and Latvia at 150,000 Euros.
On purchase of the property, the buyer is quickly granted the residency permit/golden visa. He is now free to use, sell or rent the property out while continuing to enjoy EU residency. Bulgaria on the other hand starts residency and passport processing for capital injection of an amount as low as GBP 150,000 (approx INR 1.5 Crore).
The European Parliament at Brussels along with other members of the union are closing monitoring developments. Many are concerned and have raised serious objections. The ability of those who purchase these permits to easily move about seeking work, adds more pressure to governments struggling with high unemployment rates.
Some of the concerns raised include:
Not surprisingly the responses to these schemes have been positive. People from various countries have shown interest and also applied for it. Many local citizens wonder how much effort is being made to scrutinize the applicants and their source of funds. Individuals with serious criminal records being allotted visas will certainly invite more such elements into the nation.
The question of where these funds come from is equally important. Drug peddlers, weapons smugglers, woman traffickers, smugglers and even terrorist organisations today have huge sums of money in their possession. Routing these funds through such schemes allows them to infiltrate Europe and further expand their anti social network.
Many of those applying for these schemes include high net worth individuals from various countries, advised to seek a second passport as to evade paying high taxes at their home nation and to hide away certain sources of income and capital gains. Eduardo Saverin, co-founder of Facebook, gave up his American passport and took a Singapore citizenship just before the facebook IPO was announced. Last year highly acclaimed actor Gerard Depardieu chose to leave France, refusing to pay the new hiked tax rates. He famously surrendered his French passport and took up Russian citizenship, offered to him personally by Russian President Vladimir Putin.
Sentiment across Europe is clearly against immigration. Following the crisis of 2008, right wing groups and nationalist organisations have reported a huge increase in memberships. Governments and the EU parliamentarians have clearly lost touch with ground reality. In 2011, Anders Behring Breivik, single-handedly planned and executed the Oslo bomb attacks. Before he executed the attacks, he released a 5000 page document titled “2083:
A European Declaration of Independence”, where he called for Muslims and non Europeans including Asians to be evacuated from the European mainland. His act though condemned brought to the surface the hidden anti-immigrant feeling amongst many Europeans. France followed soon with a law banning the Burqa in public spaces and also the Sikh turban in schools. Switzerland following a public referendum voted to ban mosques from having a minaret to publicly announce prayer timings. Organisations like the English Defence League in the United Kingdom (UK) have tapped the growing discontent amongst white youth to target immigrants, their homes and businesses.
Today more than ever, the EU as an organisation faces a threat of disintegration. The financial crisis has severed ties between nations; many are against decisions being imposed on them by others. No where is this sentiment more than in the UK. Prime Minister David Cameron has asserted that he believes a renegotiation of the terms and conditions of UK’s membership in the EU are necessary. A view opposed most vocally by France and Germany. In May 2015, Britain goes to the polls; the Prime Minister has promised that if his Conservative party returns to power, he will hold the controversial in/out referendum to decide whether UK should continue as a member of the EU.
Without doubt, these schemes have raised much needed capital for countries. Portugal alone raised 440 million Euros since they started the scheme in 2012. Certainly encouraging others in the EU to take the same route. One must wait and see how others respond to these developments in the coming years how the social and cultural fabric of Europe changes with the influx of new citizens.
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