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August 27, 2020

Montenegro sees 142% surge in citizenship by investment applications during Covid

As the newest kid on the citizenship by investment block, Montenegro is currently seeing a huge surge in demand for its economic passport. So, what exactly is the pull of this little Balkan country?

As an emerging luxury destination (expected to become the next Croatia), located on the Adriatic Sea in Europe, with a safe and stable environment and an economy that’s displaying record growth (GDP grew 4.9% in 2019), it’s little surprise to discover that demand for Montenegro’s Citizenship by Investment Programme is at record levels.

According to CNN, Montenegro has seen a 142% spike in applications during the Covid-19 pandemic in the first quarter of 2020, compared with the fourth quarter of 2019.

Safe, secure and sought-after
The newest kid on the citizenship-by-investment block and the fourth European country to launch a CBI programme, after Malta, Cyprus and Bulgaria (and Greece and Portugal, if you count residency leading to citizenship), Montenegro’s CBI Programme was unveiled in October 2018 following several years of planning.

And according to industry-leading global financial advisory firm, Arton Capital, Montenegro’s Citizenship Investment Programme (CIP) has “become one of the most sought-after investment options for families who are in search of a better quality of life, as well as security for their children and their future”.

Long regarded as the pearl of the Balkans, Montenegro boasts stunning natural beauty, with some of the prettiest mountain landscapes in Europe, a 300km dramatic coastline, amazing ski resorts and one of the world’s most luxurious yachting marinas, Porto Montenegro, which is the largest marina in the Med.

Montenegro citizenship surge applications

Growing GDP and good for business
But it’s the country’s independence and strategic geographical location in Europe, with direct access to the Adriatic Sea, that makes it an ideal country for investors and for those looking for new business opportunities.

Arton Capital adds: “From a surge of real estate developments to its strategic location becoming central to global industries, Montenegro offers families a chance at success, growth, and peace of mind for generations to come.”

And especially considering the country’s accession to the EU, which is very likely to happen in 2025, giving citizens and their families, from 2025 onwards, the freedom to live, work and study anywhere in the 28 EU member states.

Furthermore, Montenegro offers one of the lowest personal income tax rates in Europe and one of the best conditions for freely doing business in the EU, with its corporate tax rate at just 9%.

According to Discus Holdings: “Montenegro now offers a very efficient and productive environment for investors, including a flat corporate tax rate of 9%. The main strength of Montenegro’s economy is tourism, but other sectors have also contributed to a 4.8% increase in GDP last year.”

Offering a competitive European CBI Programme
And while all of this makes Montenegro highly competitive with the other European countries currently offering CBI programmes – Malta, Portugal, Greece, Bulgaria (though all these are current members of the EU) – the cost of citizenship to the Baltic country of Montenegro is what really clinches the deal for many.

Montenegro’s CBI programme is currently the cheapest and quickest European second passport on the market, requiring just €350,000 and a processing time of three months. In comparison, Malta demands a donation and added charges of around €1,000,000 and takes around a year and Bulgaria asks for €475,000 and can take anywhere between 2-5 years to process. You can get eventual citizenship, via residency, to both Portugal and Greece for as little as €250,000, but it does take five years and seven years, respectively, to secure that second passport.

Also, unlike most other European CIPs, applicants do not need to live in Montenegro on a continual basis to secure citizenship. With a processing time of around three months, all applicants must make a €100,000 donation to the government and then can choose to either invest €250,000 in a government-approved property project in the less developed parts of the country, or €450,000 in the developed southern region (the seaside) or the capital city, Podgorica. There are currently six development projects approved by the government.

But Montenegro’s CBI programme hasn’t been without its problems. While it may only have been operational for 18 months, it’s already come under EU scrutiny, and in March 2019, the EU gave Montenegro until the end of 2019 to increase its tax transparency or be blacklisted. It survived, although Montenegro ranks 67th out of 180 countries by Transparency International.

Offering a covid-free haven
Pandemic-wise, the country has also managed to maintain a mainly Covid-free environment and this is certainly a pull for many HNWIs moving forward.

The Montenegro government has been praised for its timely and thorough response to the pandemic (Montenegro took pre-emptive measures to close its borders to the rest of Europe in early March) resulting in low-infection rates and one of the lowest death rates in Europe.

With the recent relaxation of travel restrictions, in July, more applications for citizenship by investment are currently in the pipeline for passport issuance.

Set to run in its current form only until December 31, 2021, Montenegro’s citizenship by investment programme has capped citizenship at 2,000 investors and family members.

For more information about Montenegro and its CBI Programme, read our country profile by clicking here