Lessons for Nigeria as Mauritius, Namibia woo more dollar millionaires

Nigeria, Africa’s most populous nation, can take lessons from smaller countries like Mauritius and Namibia that are using investment migration programmes to attract high-net-worth individuals to boost foreign investments needed for growth and development.

According to the latest Africa Wealth Report by Henley & Partners, a global wealth advisory firm, the number of dollar millionaires in Mauritius grew by 69 percent from 2012 to 2022 and Namibia’s own grew by 20 percent. But in Nigeria, it declined by 30 percent.

“In an increasingly unpredictable world, investing in multiple residences and alternative citizenships with the additional passports and personal access rights that accompany them is becoming the norm,” it said.

Investment migration is a form of legal migration used by many countries. It comprises various citizenship and residence by investment programmes (golden visa programs), which allow individuals to gain citizenship or residence rights in return for investments in their host countries.

It is attractive to investors who intend to maximise and stabilise their profits by diversifying their activities across more reliable economies, making this kind of investment a form of insurance against global volatility.

There has been a spike in interest in residence and citizenship by investment globally, with a 46 percent increase in inquiries in 2022, according to the wealth report.

It said the ease of doing business and a highly stable political and economic environment are part of the incentives that have attracted investors to countries like Namibia and Mauritius.

Nigeria can take a cue from Mauritius and Namibia’s focus on diversifying their economies. By prioritising sectors such as tourism, agriculture, and technology, these nations have mitigated economic vulnerabilities and unlocked new avenues for growth.

“The safety levels in a country and the efficiency of the local police are probably the most critical factors in encouraging long-term wealth growth,” the report said.

According to New World Wealth’s in-house safety index for 2022, Mauritius ranks as the safest country in Africa, followed by Namibia.

“Ease of doing business — Mauritius ranked 1st in Africa and 13th worldwide in the World Bank’s 2020 Doing Business, while Namibia is recognised for its highly stable political and economic environment. Namibia is one of Africa’s gems. Considered among the safest nations in Africa, the democratic country of Namibia offers an impressive infrastructure and an excellent quality of life,” the report said.

It said that generally, what investment migrants hope to achieve are benefits within the host country (social security, economic stability, or tax savings) and the rights they secure in additional countries.

Nigeria has been plagued by insecurity, instability in government policies and high cost of doing business.

Rising inflationary pressures have weakened the purchasing power of consumers, even as businesses grapple with higher operating costs.

The Central Bank of Nigeria last June merged all the segments of the foreign exchange market into the Investors and Exporters window and reintroduced the willing buyer, willing seller model.

The naira has continued to depreciate against the dollar and other major foreign currencies since then. The currency has lost over 70 percent of its value against the dollar, making it one of the worst-performing currencies globally.

“In times of volatility, investment migration is a way to mitigate regional and global risk through domicile diversification, no matter where the client originates from,” Stuart Wakeling, managing partner at Henley & Partners, said.

“The investment is in the luxury of optionality, so they and their families will never be limited to one country alone. Alternative residence and citizenship by investment programmes provide a gateway to financial opportunity and a buffer against economic and geopolitical uncertainty,” he added.

The wealth report noted that the Namibian government is actively seeking foreign investment to boost the country’s economic growth and diversify the economy.

To gain a work permit and residence rights in Namibia, investors can acquire real estate with a minimum value of $300,000 through a company in the President’s Links Estate in Walvis Bay.

Similarly, Mauritius offers efficient pathways to residence through real estate investments and tailored programmes for senior citizens, attracting interest from around the globe.

The most effective means of attaining residency status in Mauritius is via the Mauritius Residence by Investment Program. This avenue enables foreign nationals to invest in real estate within the country, apply for a residence permit, and achieve Mauritian residency within a timeframe of six to eight months.

According to the report, for Mauritius, the routes to become a citizen by investment include a monthly transfer of $1,500 (equivalent to $18,000 annually) to a Mauritian bank account, acquisition of residential properties such as duplexes, villas, or apartments within senior living property development schemes (with no minimum investment requirement), or participation in conventional property development schemes or smart city projects, with a minimum investment threshold of $375,000.

Additionally, there is the premium visa option, permitting non-citizens from over 100 countries to stay in Mauritius for six months to one year, subject to specific conditions, with the possibility of renewal.

The authors of the report noted that in Africa, the trend is expected to persist as affluent African investors concentrate on diversifying their residences and assembling a complementary portfolio of residency permits and citizenships. Such strategies aim to secure enhanced global access and flexibility, mitigating the impact of persistent market and political instability.

“As wealth grows on the continent, and countries realise the benefits of programmes in aiding economic progress, we expect to see investment migration continue to gain ground in Africa in the coming years — not only on the demand side from high-net-worth investors in Africa looking to obtain alternative residences and citizenships, but also on the supply side, with more and more African countries looking to launch their investment migration programmes to increase the inflow of both capital and talent,” the report said