IM Yearbook 2020/21

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What impact can the investment migration industry have on the SDGs? Investment migration brings in fresh capital, human skills and entrepreneurial capacity for the receiving nation. Some of this money contributes, perhaps unintendedly, towards meeting the SDGs. It is estimated that investment migration programmes worldwide have raised around $60 to $70 billion between 2008 and 2019. This represents a rather small proportion of the total $5 trillion to $ 7 trillion that are at the very least required to achieve the SDGs. Nevertheless, for small states citizenship-by-investment (CBI) programmes have been an important source of fiscal revenue. For instance, the CBI programmes in Antigua and Barbuda, St. Kitts and Nevis, Dominica and Vanuatu represent over 30% of fiscal revenue. In other countries, such as Malta and Cyprus, CBI revenue accounts for 4% to 5% of GDP, and this percentage goes up to anything between 15% and 25% for Caribbean CBI countries. So, for small economies, this money can make a large contribution in terms of providing both fiscal revenue and foreign exchange. For larger economies – the UK, Spain, Portugal, Greece and others – RBI income is not as important as a share of GDP or total public revenue although it still plays a role in strengthening certain economic sectors and creates value in distressed regions. However, in macroeconomic terms, investment migration has the largest impact on small states. Can you share a few concrete examples of how investment migration programmes have already contributed to the SDGs? CBI resources have made important contributions to the funding of physical and social infrastructure, particularly to finance the reconstruction of infrastructure damaged by hurricanes that have hit the Caribbean. In 2017, Dominica was severely affected by Hurricane Maria and Antigua and Barbuda was hit by Hurricane Irma. CBI resources helped rebuild nearly 60% of all infrastructure that was being damaged by these climate events. These are two examples of how investment migration has contributed through the inflows of foreign resources that were mobilised by domestic authorities, to restoring living standards after main natural disasters. In terms of the SDGs they broadly contribute to “Good health and wellbeing” (SDG3), “Clean water and sanitation” (SDG6) and “Industry, innovation and infrastructure” (SDG9). Residence-by-investment (RBI) programmes can have a potential impact on SDG8 – Decent Work and Economic Growth and SDG1 – Poverty Reduction. Take the EB-5 in the US that requires investors to create at least ten jobs per year. This is a source of extra income for workers and owners, although we have relatively little information on the extent the jobs created have been accompanied by effective social protection of workers (decent jobs). In Portugal, Spain, Greece and other countries, investment migration is directed to business investment that create jobs mainly in the services sector. Some investment migration programmes appear to have a broader impact on the receiving nations than others, while critics are highlighting even negative effects of some programmes, including overheated real estate markets and the overreliance on investment migration funds. With the SDGs in mind, how should government’s make best use of investment migration funds? Today, we are seeing two types of investment. One modality is ‘passive investment’, for instance in government bonds or in the real estate market; another modality is ‘active investment’ through which the migrant may be directly engaged in the creation of new businesses and the process of job creation. Governments in the recipient countries should encourage more active investments, although passive investments also play a role. A consequence of passive investments in real estate is the tendency to push up property prices, especially in big cities such as London, New York, Paris, Sydney and others. As a consequence of price spirals in the property market, housing becomes unaffordable for the local population with modest and middle-income levels who have to move to live in locations away from their jobs and schools of their children. This shows that investment migration can feed into already existing social inequality mechanisms in the area of access to housing. This is a side effect that has to be seriously considered. Andrés BIO Solimano holds a Ph. D. in Economics from the Massachusetts Institute of Technology (MIT) and is founder and Chairman of the International Center for Globalization and Development (CIGLOB) based in Santiago, Chile. It is estimated that investment migration programmes worldwide have raised around $60 to $70 billion between 2008 and 2019. 42 Investment Migration Yearbook 2O2O/2O21
Another feature of investment migration is the channelling of capital into the tourism and entertainment sectors such as hotels and residential developments. At the same time, a case can be made for boosting investment into the manufacturing sector and higher value-added products. The promotion of green and clean-energy activities and organic agriculture are important priorities in a sustainable development strategy. Funds from investment migration programmes could be geared to these socially and environmentally desirable destinations. Service providers, however, report that most of their clients considering the investment migration route prefer passive investments. How can governments strike the right balance? That’s true, although it depends on the demographic profile of people who are moving across national borders. There is a study of foreign investment and investment migration to Canada which found out that a proportion of foreign immigrants aged over 60 yearsold prefer passive investments. They feel they have more or less completed their active working life and want a more relaxed lifestyle in their new country of destination. However, there is also a proportion of immigrants who enjoy a direct entrepreneurial role and want to in create new productive ventures in Canada and other nations. We have to keep in mind that most investment migration programmes were put in place after the global financial crisis in 2008, and governments were not making very stringent requirements because they wanted to attract foreign investors. But with these programmes coming to maturity new priorities are needed. Unfortunately, we are being hit by a new crisis, that of Covid-19, and probably investment migration will be needed to support recoveries and long-term growth. How do you envision the investment migration industry will develop in the coming years? The industry has to learn from the experience of past years and be aware of the new realities and challenges emerging with Covid-19 as we are entering into a new global age that will be probably more uncertain, fragmentary and risky. In the past ten years after the global financial crisis of 2008-09, globalisation has been strained by several factors: sluggish recoveries, rising inequality, job fragility, protectionism and new waves of debt creation. At the same time, we have seen a political and cultural backlash against globalisation accompanied by populism, nationalism and xenophobia. Global problems require global responses and more international cooperation rather than inter-country competition in critical areas such as vaccine development and new technologies. The investment migration programmes should be an integral part of a globalised world that keeps the principle of free international mobility of people. Still this industry would benefit from aligning investment migration more with the concept of sustainable development and gearing investments towards high quality jobs, more social equity, green production and ecosystem protection. The 17 Sustainable Development Goals GOAL 3 Good Health & Well-being GOAL 6 Clean Water & Sanitation GOAL 9 Industry, Innovation & Infrastructure GOAL 12 Responsible Consumption & Production GOAL 15 Life on Land GOAL 1 No Poverty GOAL 4 Quality Education GOAL 7 Affordable & Clean Energy GOAL 10 Reduced Inequality GOAL 13 Climate Action GOAL 16 Peace & Justice Strong Institutions GOAL 2 Zero Hunger GOAL 5 Gender Equality GOAL 8 Decent Work & Economic Growth GOAL 11 Sustainable Cities & Communities GOAL 14 Life Below Water GOAL 17 Partnerships to achieve the Goal Investment Migration Yearbook 2O2O/2O21 43
Page 1 and 2: IM INVESTMENT MIGRATION Win-Win Pat
Page 3 and 4: from IMC Education and Training: Gi
Page 5 and 6: 60 62 63 65 68 70 75 76 83 89 91 92
Page 7 and 8: INDATA Key Facts and Figures 100-60
Page 9 and 10: 750 Million People Would Like to Mo
Page 12 and 13: INDUSTRY OVERVIEW DOUBLING DOWN ON
Page 14: A Changing Market China has long be
Page 17 and 18: What’s your economic outlook for
Page 19 and 20: 400+ MEMBERS FROM 55+ COUNTRIES Int
Page 21 and 22: Covid-19 is upending the investment
Page 24 and 25: Interview with KRISTIN SURAK, Assis
Page 26 and 27: Interview with BRUNO L’ECUYER, Ch
Page 28: When the news broke about covid-19,
Page 31 and 32: on investment migration, the Commis
Page 33 and 34: C0% WE ARE PLEASED TO ANNOUNCE THE
Page 35 and 36: two stages: administrative and judi
Page 37 and 38: In conversation with KIERON SHARP,
Page 39 and 40: ● Codrington Although initially i
Page 41 and 42: Interview with GASTON BROWNE, Prime
Page 43: What are SDGs? They are a set of 17
Page 48 and 49: ADVERTORIAL VCA boasts a specialize
Page 50 and 51: WHAT’S GOING ON IN… Programme U
Page 52 and 53: Europe Europe’s attractiveness as
Page 54 and 55: Southeast Asia Southeast Asia is th
Page 56 and 57: Interview with ALEX MUSCAT, Malta
Page 58 and 59: Simplicity. Safety. Sophistication.
Page 60 and 61: INVEST IN PARADISE. MAKE IT HOME A
Page 62 and 63: FIRST PERSON BOB KRAFT, Chairman, P
Page 64 and 65: LESSONS FROM LOCKDOWN MRVA SEES PRO
Page 66 and 67: RISK PROFILES CHANGE Don’t Be the
Page 68: Impact on the IM Industry Countries
Page 71 and 72: These programmes are not going to b
Page 73 and 74: IN THEIR W,RDS “I decided to foll
Page 75 and 76: A LOCAL PARTNER YOU CAN TRUST. With
Page 77 and 78: WORKING WITH THOSE YOU TRUST THE IM
Page 79 and 80: Due diligence has long been a thorn
Page 81 and 82: There is scope to introduce a minim
Page 83: United Kingdom United States Turkey
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Page 90 and 91: Lose yourself… …and regain your
Page 93 and 94: HOW WE CONDUCT IN-COUNTRY CHECKS IN
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Beijing, China “Wealth creation i
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“Wherever I go, I want to be a ch
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INVESTING IN A GL BAL Rupert Gather
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In conversation with PARAG KHANNA,
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THE IMPORTANCE OF EB-5 Due Diligenc
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MARC AUDET PRESIDENT AND CEO AURAY
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KIERON SHARP CHIEF OPERATING OFFICE
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FRÉDÉRIC VILLA MANAGING DIRECTOR
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ROGELIO CACERES FOUNDER & CEO RCG G
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Save the Date The Investment Migrat
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IM Yearbook 2020/21

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