Commodifying Citizenship

The Rich Have Yet Another Market to Exploit…

For decades, the “investment migration” business has managed to fly under most people’s radars. But in 2023 it started making headlines. 

This year started with major changes to investment residency programs—aka “Golden Visas”—in Ireland and Portugal. Greece followed suit with changes of its own over the summer. 

In October, the British newspaper Guardian published an investigative report on Dominica’s abuse of its citizenship by investment (CBI) program. It turns out lots of unsavory characters simply bought Dominican passports to get into the European Union, never setting foot on the island of Dominica itself. 

Shortly after that, a professor of Political Sociology at the London School of Economics, Kristin Surak, released a book called The Golden Passport: Global Mobility for Millionaires. It received a lot of press coverage from The New York Times and other global press outlets. 

I’m about halfway through Surak’s book. What makes it so interesting is that she isn’t concerned with moral debates about whether a country should sell residency or citizenship. She focuses on the peculiarities of one of the most unusual markets in existence: global trade in the “sovereign prerogative of citizenship.” 

Surak raises several points that really fascinate me as someone who works to help people diversify themselves globally. 

First, only countries can create citizenship. There’s no secondary market in citizenships—at least not a legal one. So, if countries are going to sell citizenship as a product, they must stand behind it with a guarantee. Once it’s been issued, there’s no going back. 

For example, a few years ago Cyprus tried to revoke the citizenship of some investors who’d failed to uphold their end of the citizenship by investment agreement. But Cypriot courts ruled that under international law, the legal status of citizenship cannot be withdrawn. Once you’ve given somebody citizenship, you can’t take it away, even if they don’t do what they promise to do to get it. 

There aren’t many other product markets I can think of that work like this. 

Surak makes another striking point: although most people in developed countries think of citizenship as a form of belonging, for most people on the planet, citizenship is a tool of exclusion.  

Surak points out that the “obligations” of citizenship are fading. Mandatory military service is disappearing. Most countries base their tax systems on physical presence rather than citizenship (the U.S. is the outlier in that regard).  

So, to the extent that people care about citizenship, it’s about things like visa-free access, rights of residence in other countries, and overseas business opportunities. It’s those “external” factors that make citizenship a commodity and a market. It’s why people buy citizenship in a country and never set foot in it. 

But only a tiny fraction of people in the world today can take part in that market. Those people can acquire more than one citizenship and reap the benefits.  

For the vast majority of international migrants, the rules of citizenship exclude them from better life chances in other countries. The attitude of the rest of the world is that they should stay in the country they were born in.  

In other words, citizenship both reflects and drives global inequality. 

Surak’s third—and most fascinating—point is that despite how much we hear about the European Union trying to control the global investment migration industry via rules on visa-free access, the real power broker in investment migration is the United States. 

She points out that when Malta started its CBI program, the U.S. quietly told its government not to accept any Russians. It assured the Maltese that if they agreed to that, the EU wouldn’t crack down too hard on them. There’s a similar dynamic at work with the Caribbean CBI countries. (Paradoxically, the U.S. continues to allow Russians to become naturalized citizens.) 

Surak says that rather than try to stop investment migration, the U.S. wants to be able to exercise this kind of backroom control to gain intelligence on who is buying citizenship, where, and why.  

In other words, rather than pursue another pointless exercise like the War on Drugs, the U.S. allows the global citizenship market to continue because it serves a useful purpose. 

I’m busy preparing a report on citizenship by investment programs for my Global Citizen service. Unlike Professor Surak’s book, it’s going to be focused on the practicalities of choosing a citizenship to buy… and how to make sure you get the best possible deal!  After all, if she’s right that the U.S. is going to keep tolerating investment migration, you might as well take advantage of it.