One foot out the door – visa regimes that offer Saffas options and opportunities

15 Mar 2023

As the rand loses ground against the dollar, the Green Mamba’s bite is becoming less potent than ever. But South Africans still have plenty of options abroad.

Some passports are just more coveted than others. The latest Henley Passport Index, based on International Air Transport Association data, has revealed Japan leads the world’s passports according to the number of destinations holders can access.

Japanese citizens can visit 193 destinations out of 227 around the world visa-free, while South Koreans and Singaporeans, whose countries are tied in second place on the index, enjoy a visa-free or visa-on-arrival score of 192.

Germany and Spain are placed jointly in third, with visa-free access to 190 destinations. The UK and the US are in sixth and seventh places, with scores of 187 and 186, respectively.

The index measures visa-free access to 227 destinations but for global citizens and international businesspeople, a better measure of economic mobility and opportunity afforded by their passports is an indication of what share of the world’s GDP is accessible to them visa-free, explains the chair of Henley & Partners, Dr Christian H Kaelin. “Our latest research into how much global economic access each passport provides is a useful tool for investors, in addition to giving new insight into the ever-widening economic inequality and wealth disparity that has come to define our world.”

Passport to economic power

By combining Passport Index data and World Bank GDP data, Henley’s research also ranks the world’s 199 passports in terms of passport power, which indicates the percentage of global GDP each passport provides to its holders, visa-free.

The powerful Japanese passport’s visa-free access to 85% of the world gives it entry to countries that account for 98% of the global economy. In terms of percentage of global GDP, the US and China have 25% and 19% respectively, but American passport holders can access 43% of the world’s economic output visa-free, bringing their total to 68%, while Chinese passport holders can only access an extra 7% visa-free, taking their access to just 26% of global GDP.

South African passport holders have access to nearly double the number of destinations Indian passport holders do – 106 compared to 59 – but those destination countries account for a mere 15% of global GDP.

And while South Korea and Russia have similar GDPs of about 1.9% of global economic output, with $1.8-trillion, South Korea has a visa-free score of 192, giving its passport holders access to 81% of global GDP, while Russia has a score of just 118, so its passport holders have access only 19% of the world’s economy.

Russia is ranked 49th with a score of 118, while Ukraine sits 13 places higher, ranking 36th with a score of 144, but Russians are effectively barred from travelling throughout most of the developed world.

Options for Saffas:

Golden visas

In Europe, Ireland last month closed their Immigrant Investor Programme which included an enterprise investment, investment fund, property investment trusts, and the endowment option. Ireland’s Startup Entrepreneur Programme, which provides a route to residency for innovative entrepreneurs, is still on offer.

Portugal and Spain are also planning to stop the sought-after residence-by-investment schemes, known as golden visas, in a move to stem the rising cost of housing and crime.

On 24 March, Portugal will be debating amendments to the Immigration Law, over concerns it facilitates money laundering and enables criminal and terrorist organisations to legally infiltrate the Schengen Zone.

Not everyone is convinced it will be good for the country, as the programme has brought in about €‎7-billion for Portugal – almost 90% from the purchase of property, reports Deutsche Welle.

Statistics from the Portuguese Immigration and Border Service show only 22 visas were issued for job creation, resulting in a mere 280 new jobs in over 10 years.

Hugo Santos Ferreira, the president of the Portuguese Association of Real Estate Developers and Investors, told Deutsche Welle that the proposal to end the golden residence permits is an attack on all foreign investors who want to invest their money in Portugal.

“Portugal will lose its credibility and its good reputation as an investment-friendly country.”

St Kitts and Nevis

As one door closes, another opens in the Caribbean: CS Global Partners says St Kitts and Nevis has been offering investors a path to second citizenship for almost 40 years. Its Citizenship by Investment Programme opens four routes to second citizenship, which include contributing to the Sustainable Growth Fund, buying approved property, or investing in an approved Public Benefit Project.

The St Kitts Sustainable Growth Fund is a limited offer and one of the most popular options for investors looking for a path to dual citizenship. From 1 January to 30 June 2023, fees will be reduced for applications and the process expedited from 90 days to 60.

A single applicant can make a minimum investment of $125,000 or $170,000 for a main applicant and any three qualifying dependents. This translates to a saving of $25,000, about R430,000.

The Bahamas

Easy does it: The Bahamas has simplified the application process with the Bahamas Extended Access Travel Stay programme. It allows digital nomads to live and work in the Bahamas for a year, with the option to apply for up to three years.

There are no income requirements, but you do need to provide proof of employment or proof that you own a business, a valid passport and medical aid. The application costs $25 (said to take about five days). If approved, you pay $1,000 (plus $500 per dependent). Once you’ve paid, you receive a QR code which you have to present on arrival in the Bahamas.

Georgia

Have Georgia on your mind? The former east-bloc country has always offered long stays for tourists, allowing most passport holders (including Saffas) to stay visa-free for 365 days. It has a simplified entry form allowing people from more than 95 countries to live and work without restrictions. Once you hit the 183 days mark, you become liable for Georgia’s tax.

Portugal

In Portugal, you can get residency via marriage, family reunification, study, work, investment or retirement. If you can’t claim Portuguese ties, the D7 passive income visa is an enticing option as it offers South Africans an easier and more affordable route into the homeland of Port, pastel de nata and azulejos, the elaborately-painted blue and white tiles.

Applicants also do not have to commit to purchasing a property or investing directly in the country, explained Sovereign Trust consultant Dani van Vuuren.

The D7 offers several benefits: it allows applicants to take up employment in Portugal and it gives applicants and their families a foothold in Europe, allowing them to travel without a visa throughout the Schengen Zone. The D7 is valid for an initial two-year period, after which it can be renewed for an additional three years. If you stay for five years, provided you are proficient in Portuguese, you will be eligible to apply for permanent residency.

There are other conditions, said Van Vuuren: Applicants will have to meet the minimum passive income level of €8,460 a year, with additional income requirements for spouses and dependent parents, and they have to live in the country for at least 183 days per year.

Apart from the D7, Portugal launched a digital nomad visa for remote workers in October 2022, which allows foreigners to live and work in the country for 12 months or longer, provided they can prove income of at least €2,820 per month, earned in the three months preceding the application.

The digital nomad visa can be granted as a Temporary Stay Visa for a period of less than a year, or as a Residence Visa for a period of 12 months or longer. Applicants will have to commit to staying in Portugal for most of the visa period.

Other options for South Africans looking for passive income programmes include Cyprus, Greece, Spain, Mauritius and Thailand, said Van Vuuren.

No Green Card?

In the United States, the EB-5 visa is a route to permanent US residency for those able to make a qualifying investment of $900,000 into a Regional Centre project located in a rural area. Each investment must generate employment for a minimum of 10 US workers.

Mauritius

Mauritius remains one of the more affordable options for Saffas. With almost no income tax, capital gains tax or estate tax, South Africans still get relatively good bang for their bucks while enjoying island life, as the cost of living is comparable (except for grocery items such as beef and wine).

Leana Nel of Park Lane Properties said more South Africans are looking at the island for its lifestyle and investment opportunities.

“There are several reasons why South Africans want to retire, live or invest in Mauritius. The country has a stable economy and a strong tourism industry. Mauritius is a member of the Commonwealth of Nations. This means that citizens of Commonwealth countries can travel to Mauritius without a visa.”

South Africans have a choice of residence visas in Mauritius:

By investment in business: Requires an investment between $25,000 and $50,000 in local businesses; professionals and self-employed can stay for a maximum period of 10 years, renewable subject to conditions.

By investing in property: Mauritius’ golden visa enables non-citizens to obtain immediate permanent residence by investing a minimum of $375,000 in certain types of property – the well-known Integrated Resort Schemes, Real Estate Scheme and Property Development Scheme developments as well as Smart Cities and Ground+2 apartment developments, said Park Lane.

By retirement: For those aged 50 years or older, the requirements are an initial transfer of at least $1,500 into a Mauritian bank, followed by an annual transfer of at least $18,000 per year.

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By innovation: Mauritius welcomes entrepreneurs and start-ups. To apply, entrepreneurs need to present a business plan that reflects R&D expenditures which must constitute at least 20% of total operational expenditure during the research phase. Applicants are required either to submit their proposal to the Economic Development Board for evaluation and approval, or to register with an accredited incubator, explained Sovereign.

The Innovator Occupation Permit is valid for 10 years and is renewable.

By occupation: Those wishing to apply for an occupational permit to work and live in Mauritius can do so either as investors, professionals or self-employed.

The investor and self-employed permits are issued for 10 years and are renewable; the professional permit is only issued for three years, both subject to conditions.

Self-Employed Occupation: This “digital nomad” visa is ideal for freelancers. Sovereign said a minimum investment of $35,000 is required in a professional activity, together with two letters of intent from potential clients. The permit is valid for 10 years and is renewable, subject to a business income of MUR800,000 a year (about R315,000) from the third year of registration. After three years, provided they have held an annual business income of at least MUR3-million for three consecutive years, they can apply for a 20-year permanent residence permit. Plus, they can bring their partners, parents and/or children.

Foreigners can also apply for an investor occupation permit under the following three options:

Investment of $50,000 – initial transfer in a business activity.

Net asset value (NAV) of $50,000 – produce evidence that an existing or inherited business has a NAV of at least $50,000 and has achieved a cumulative turnover of at least MUR12-million during the three years preceding the application.

High-Technology Machines and Equipment – A minimum investment of $25,000 in agro-industry, aquaculture, healthcare, ICT, business process outsourcing, fintech, life sciences, biotechnology, manufacturing, ocean economy or renewable energy. DM168

For a comprehensive list of digital nomad visas, visit Goats on the Road

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