The Journal of Ethnic and Migration Studies is an English scholarly journal that studies and analyzes all forms of migration and its consequences. The journal publishes articles on ethnic conflict, discrimination, racism, nationalism, citizenship and integration policies.
In 2020, the journal’s authors, Christine Surak, associate professor of sociology at the London School of Economics, and Yusuke Tsuzuki, associate professor at Harvard’s Graduate School of Arts and Sciences, assessed how a country’s economic situation affects the launching of “golden visa” programs in the European Union.
The authors drew data from public sources of program departments and local and international organizations, such as the European Parliament, the World Bank and regional Ministries of Labor and Migration.
How was the research carried out
The aim of the research is to understand what motivates countries to develop residence permit investment programs. The authors analyzed information on 28 EU countries for the period from 2005 to 2019.
The programs can be roughly divided into “active” and “passive” programs. Active programs require investors to prove financial solvency and professional experience. Passive programs require only a cash investment: applicants invest in real estate, bonds, or companies.
The research looked at programs that offer “passive” investment options – the United Kingdom and 13 European Union countries: Bulgaria, Cyprus, Estonia, Greece, Hungary, Ireland, Italy, Latvia, Luxembourg, Malta, the Netherlands, Portugal and Spain.
The authors ran a regression using country-year as the unit of analysis. Regression analysis is a statistical analytic method that calculates and models the relationship between dependent variables with independent variables.
The research on residence permit programs used a dummy variable in analyzing the economic situation and independent variables – one-, two-, and three-year GDP growth, the housing market price index, and the unemployment rate. The authors also paid attention to the 2010-2012 economic crisis.
What conclusions were reached by the authors of the research
Government bonds reduce the country’s debt burden.
Investing in businesses, including through investment funds, creates jobs and helps reduce unemployment.
Buying real estate stimulates the domestic real estate market.
The EU earns about 3 billion euros annually from “golden visa” programs, but they generate no more than 0.3 % of the union’s total revenue. The returns are unevenly distributed: most of the money goes to Greece, Portugal and Spain, with each country receiving about 750 million euros.
UK, Portugal, Greece and Malta income from residence permit program in 2019
Foreign investment in real estate has almost no impact on the domestic real estate market. For example, the total volume of foreign investment in residential real estate in Portugal amounted to 13% of all transactions, of which only 22% accounted for the residence permit program. Most transactions were made by citizens of neighboring EU countries. Thus, they have more influence on the destabilization of the real estate market in any country.
The situation on the Greek real estate market is different: 72% of transactions accounted for foreign investors, of which 36% were applicants for a residence permit program in Greece.
Governments were more likely to launch residence permit programs if the country was in economic crisis. But the number of existing programs did not affect the launch of residence permit programs by other countries: each acted in their own interest – trying to help the economy to cope with a temporary downtu .
In what countries you can get a residence permit in 2021
The authors of the research did not try to find out why investors choose a particular country. But they noticed that most investors participate in the programs for two main reasons:
Visa-free travel within Schengen;
increased income by investing in real estate, business or bonds.
Five EU countries and Great Britain offer foreigners a residence permit in exchange for investment. The status allows you to live, study or work in the country of residence and travel freely within the Schengen states.
Investment programs in the EU and the UK
|Country||Minimum investment||Investment options|
|Permanent residence in Cyprus||From €300,000||
|Residence permit in Greece||From €250,000||
|Residence permit in Portugal||From €350,000||
|Permanent residence in Malta||From €110,000||
|Residence permit in Spain||From €500,000||
|Residence permit in the UK||From £2 million||