By Dr. Juerg Steffen, CEO at Henley & Partners
The rise in millionaire migration is undeniable. In 2024, a record 128,000 high-net-worth individuals (HNWIs) are forecasted to relocate to new countries, marking a significant increase from the 51,000 who did so a decade ago. This influx of wealthy migrants injects a substantial infusion of capital, expertise, and entrepreneurial energy into receiving countries.
Given the steep acceleration in demand and the substantial sums involved, it’s unsurprising that policymakers are prioritising the development and enhancement of investment migration pathways into their countries to attract these mobile millionaires.
Redefining Public Finance with Sovereign Equity
At the heart of investment migration lies a groundbreaking concept: sovereign equity. In contrast to traditional debt-based funding models, residence and citizenship by investment programmes enable countries to augment state revenues and enhance national prosperity without increasing their debt burdens. This empowers governments to boost fiscal autonomy and public spending on strategic priorities, benefiting all citizens.
Inflows generated by these programmes can be transformative, with extensive macroeconomic implications. Host countries benefit financially through contributions to the government, tax revenues, or investments in government bonds. Concurrently, the private sector receives capital injections into businesses, start-ups, and real estate.
The economic impacts are cumulative. Receiving countries often experience growth in construction and real estate, increased liquidity across the banking system, job creation, new revenue streams via duties and taxes on imports, and thriving tourism sectors with associated tax and spending benefits.
Lasting Economic Impact
The tangible benefits of investment migration are evident in countries that have successfully implemented these programmes. Take Malta, for instance. In the years following the launch of its Individual Investor Programme in 2014, Malta experienced some of the highest economic growth rates and lowest unemployment levels in the European Union. Pre-pandemic, it led the bloc on virtually every economic metric.
The results are unambiguous. From 2015 to 2021, Malta’s programme attracted over €1.1 billion in contributions, €320 million in real estate purchases and rent, and €220.9 million in government bond investments. Consequently, Malta achieved annual budget surpluses for the first time in decades.
The Caribbean region has seen similar success stories unfold over the past 15 years. St. Kitts and Nevis pioneered the trend in 2007 when it revamped its citizenship programme. This triggered an unprecedented investment boom in the dual-island nation and several regional neighbours that subsequently launched or enhanced their own programmes.
In Antigua and Barbuda, the country’s citizenship programme has financed substantial investments in construction, fostering a buoyant sustainable tourism industry. Critically, these revenues have contributed to Antigua and Barbuda’s transition to renewable energy, funding the installation of thousands of solar panels on public buildings and land. Programme capital also proved indispensable for reconstructing Barbuda following the devastation of Hurricane Irma in 2017.
Grenada has similarly leveraged its programme inflows to support the development of key public infrastructure, such as a cutting-edge hospital and library. Notably, these funds have bolstered Grenada’s climate resilience against the intensifying natural disasters that imperil Caribbean nations.
Investing in a Sustainable Future
As the global community confronts the pressing challenge of climate change, investment migration also offers countries an innovative tool to channel programme revenues into sustainable development initiatives.
The past year alone has seen an alarming array of climate-related disasters, from the wildfires that consumed millions of acres in Canada to the devastating cyclones that displaced over half a million people in southern Africa. Europe grappled with extreme heat and wildfires that forced the evacuation of tourists in Greece, while Mexico faced the rare and destructive Hurricane Otis. These events underscore the urgent need for countries to invest in climate resilience and adaptation measures.
Investment migration programmes provide a unique opportunity for governments to finance these critical initiatives without increasing their debt burdens. By directing programme inflows towards projects that bolster sustainability and resilience, countries can simultaneously attract foreign capital and make meaningful progress in the fight against climate change.
Grenada, for instance, has utilised funds from its citizenship programme to strengthen its resilience against intensifying natural disasters. Through its National Transformation Fund, the country has supported the development of sustainable agriculture and alternative energy projects, creating jobs in emerging green industries while reducing its dependence on fossil fuels.
By aligning private wealth with public good, these programmes offer a promising path forward in the face of an increasingly urgent climate crisis.
The Road Ahead
As geopolitical uncertainties persist, countries that have yet to adopt investment migration programmes should weigh the potential benefits of doing so. By cultivating sovereign equity, attracting foreign capital, and investing in sustainable development, governments can lay the foundations for enduring growth and resilience.
However, reaping these rewards hinges on the responsible execution of programmes, prioritising transparency, robust due diligence on applicants, and ensuring investor interests align with national policy objectives. Investment migration has entered the mainstream as a powerful policy instrument for countries to stimulate economic growth, raise living standards, and build a more sustainable future. The impressive outcomes achieved by Malta, Antigua and Barbuda, Grenada, and others underscore the immense potential these programmes hold.
In an increasingly complex and interconnected world, investment migration opens up an innovative avenue for nations to harness the skills and resources of global investors in the pursuit of shared prosperity and resilience. As more countries awaken to this opportunity, the coming years could see the advantages of investment migration programmes extend to an even broader array of economies worldwide.
About the Author:
Dr. Juerg Steffen, FIMC, Chief Executive Officer of Henley & Partners, is a leader in the field of investment migration with over 30 years of experience in the financial services industry. After joining Henley & Partners in 2013 to set up its Singapore office, Juerg went on to establish the firm as a key player in what is now a significant region for inbound and outbound investment migration. Later appointed Chief Operating Officer of the group, he has played a pivotal role in growing the investment migration sector and Henley & Partners, improving the firm’s operational standing, and developing crucial structures and processes that enable it to maintain the leading position it has always held.
Before joining Henley & Partners, Juerg was a personal advisor in the family office of one of Europe’s wealthiest families. He also served as a member of the management board and as head of the Wealth Planning department of a leading private bank in Austria and was a director in the Cross-Border Wealth Planning department of UBS in Zurich, advising high-net-worth individuals and key clients in complex matters regarding financial, tax, succession, and residence and citizenship planning. Juerg also developed and established a private bank operation for one of Switzerland’s foremost banks and is the editor of definitive books on high-net-worth relocation to Austria and Switzerland.