Demand for second citizenship programmes highest in the Middle East
The region ‘has the highest proportion of billionaires in the world’
April 29, 2014 5:55 by kippreport
Sixty per cent of applicants for second citizenship or second residence programmes comes from the Middle East region, according to a joint report on ultra-high-net-worth (UHNW) intelligence by prospecting firm Wealth-X and global citizenship experts Arton Capital, which was released today (Tuesday, 29 April). However, it also notes that Asia is fast emerging as the new frontier, with ultra-wealthy Chinese and Indian nationals and non-residents likely to spur the demand for these programmes in the next five years.
Global citizenship programmes offer individuals (and their families) residency and citizenship options in a host country, with economic investment in a pre-defined list of assets as a precondition. However, it’s not easy for just anyone to do so. According to the report, billionaires are five times more likely to apply for second citizenship than standard UHNW individuals (those with at least $30 million in net assets).
The report, entitled: A Shrinking World: Global Citizenship for UHNW Individuals, also reveals that the average net worth of a second citizenship applicant is well above the global average for UHNW individuals. Second citizenship applicants have an average net worth of $205m, when compared with the global UHNW average of $135m, according to the report. “The Middle East region has the highest proportion of billionaires in the world – 40 per cent of global UHNW individuals,” says Armand Arton, president and CEO of Arton Capital.
The report also highlights advantages a second citizenship offers to both an individual and their family, as well as the country, they are applying to, such as stability and security, tax efficiency, an ease of travel, a higher standard of living, a better quality of life, increased options for their children’s educations and extensive investment opportunities.
“There are currently 200,000 UHNW individuals globally worth a collective $27,770 billion. Billionaires account for one per cent of the world’s UHNW individuals, making up 23 per cent of the collective wealth. It is predicted that, “by 2020, the billionaire population will grow by 80 per cent,” states the report.
According to Mykolas Rambus, Wealth-X’s CEO, new wealth will be created in Asia in the next decade and beyond, resulting in a growing demand for global citizenship programmes.
Arton concludes: “We are witnessing the largest succession transition, as wealth in excess of $16 trillion transfers from one generation of UHNW individuals to the next by 2044. This transition is likely to create a surge in the number of UHNW individuals deciding to change their citizenships, as the next generation will consider their asset portfolios by identifying the most relevant markets to invest in.”