Russian Foreign Investor Visa Program Review
To many business people accustomed to the citizenship and residency programs available in Europe and the Caribbean, Russia might be the last place they would pick to take out an investor visa, or even full citizenship. However, since its launch in 2015, the Russian investor visa has proven remarkably popular, particularly within the Chinese and Middle Eastern markets. Passport Reviewer checked it out.
The term “Sleeping Giant” is often used in the world of sport to describe a once mighty soccer, NFL or baseball team that still has a big stadium full of loyal fans, even though they don’t have much to cheer about. They used to be up there, competing with the best, winning their share of titles and trophies. Years have passed, the last trophy was a long time ago, but the fans remain loyal with the hope that one day that sleeping giant will awaken and regain its rightful place at the top of the pile.
The same phrase is sometimes applied to countries; the last sleeping giant to awaken from its slumber was China. China was one of the world’s great early civilizations, but for centuries it was a mere bit-part player as Europe and then the US took over, while China’s influence waned until it all but disappeared behind a seemingly-impenetrable wall of communism.
Will The Russian Bear Finally Awaken?
Then in the 1990s, the Chinese government adopted a more relaxed approach to free trade, and things began to change at a rapid rate. On 11 December 2001 China formerly became members of the World Trade Organization (WTO), and the rest as they say is history. The addition of the Chinese market and economy has changed the world completely, for better and for worse. China is currently the no.2 economy in the world, but look set to become no.1 in the coming years.
Many would suggest the next sleeping giant to emerge from its slumber will be India. With a population of 1.25 billion and modern, highly developed megacities like Mumbai and Delhi, there are many similarities between the pre-WTO China and India, even though the latter has actually been a member of the World Trade Organization since 1995.
However, a better bet might be Russia, the great, slumbering “Bear” than has never really been connected to the West since the days of the Romanovs, Russia’s last royal family, who were executed following the revolution of 1917. Unlike India, Russia is already geared up toward a sudden economic upswing, with a better educated overall population and far less of a class divide, and less of the population living in poverty (12% compared to 22% in India, according to the World Bank).
If new US president Donald Trump and Russian leader Vladimir Putin hit it off – and the early indications are that that could happen – it could lead to a dropping of Western sanctions against Russia, and a period of long-overdue economic prosperity for Europe’s largest nation.
Russia In A Nutshell
Russia – officially known as the Russian Federation – is a country located in Eastern Europe and Eurasia. In terms of surface area, Russian is the largest country in the world, and its 17 million km2 accounts for more than one-eighth of the land area of the earth. It covers nine time zones, and is twice the size of China, and 2.5 as big as Europe.
Russia’s population of 140 million makes it the largest in Europe, and ninth largest in the world. While the European section of Russia is much smaller than the Eurasian part, it nevertheless accounts for about 77% of the population. Russia is so vast, it borders 14 countries: Norway, Finland, Estonia, Latvia, Lithuania, Poland, Belarus, Ukraine, Georgia, Azerbaijan, Kazakhstan, Mongolia, North Korea and China, while it has coastlines to the Pacific and Artic Oceans.
From 1922 until 1991, Russia was known as the Soviet Union which in essence was a commonwealth of countries or “states” all functioning under the banner of communism, with Russia at the helm and Moscow at its heart. At its peak, the Soviet Union covered 22.4 million km2, and had a population of 293 million, behind only China and India. The Soviet Union began to disintegrate in 1989, and by 1991 had dissolved completely. Boris Yeltsin became president of the new Russian Federation in 1991.
Historically Russia is one of the great European nations, and was highly influential in the arts, sciences and literature. Russian scientists were able to stay neck-and-neck with the very best the USA and Europe had to offer during the Cold War – which out of necessity was possibly the most scientifically innovative and competitive era in human history.
In terms of the arts, the Bolshoi Ballet is the most famous in the world, writers like Leo Tolstoy, Fyodor Dostoyevsky and Anton Chekhov are both literary giants and great thinkers respected the world over, as are composers like Prokofiev, Rachmaninoff, Stravinsky and Tchaikovsky.
The Russian capital Moscow is the largest and most populous city in Europe, and along with New York, Paris, London, Hong Kong, Beijing, Rome and Berlin, is one of the most iconic cities in the world. Russia’s second city Saint Petersburg has almost five million inhabitants, and there are a further nine cities in the Federation with a population of one million or more.
Currently the twelfth largest economy in the world, Russia is classed as having an upper-middle income, mixed economy. It has a labor force of 77 million, and unemployment of 5.4% – the same as the UK. 62% of the workforce is employed in the services industry, followed by heavy industry and agriculture. Russia is home to more than 30% of the planet’s natural resources, which the World Bank estimates makes Russia worth $75 trillion. Russia is blessed with an abundance of natural gas, precious metal and oil, which make up the bulk of their exports.
Since becoming an electable federation in 1991, Russia has strived to maintain its place in the free world market, and initially experienced a period of economic growth, in no small part due to the good relationship between Boris Yeltsin and US president Bill Clinton. Yeltsin resigned from the presidency in 1999 due to poor health, and was succeeded by Vladimir Putin, who has been the most powerful man in Russia in one guise or another ever since. Putin has had a somewhat fractious relationship with the West, and some of his country’s actions have resulted in Russia being hit with a series of sanctions, which, combined with the fall in oil prices has taken its toll on the Russian economy.
That said, two factors could lead to a surge in the Russian economy over the next few years;
- Brexit – The UK government have chosen to go with the result of last summer’s narrow referendum victory for the “leave” campaigners and quit the European Union. Article 50 is likely to be triggered this year, which means Great Britain’s influence within the EU will effectively be over, even if the actual leave process could take several years. That is great news for Vladimir Putin and Russia as the UK has consistently been their harshest critic and a perpetual thorn in their side over everything from the Ukraine to doping at the Olympics to soccer hooliganism, and everything in between. With the UK out of the way, Russia could start to build better trade relations with other EU nations. German leader Angela Merkel- who speaks fluent Russian – reportedly has a very good relationship with Putin – who speaks excellent German, and the two converse regularly.
- Donald Trump – There definitely seems to be something of a “bromance” going on between new US president Donald Trump and Vladimir Putin. Trump has been professing his admiration for the Russian leader for several years now, often describing him as a “strong leader”, while Putin used words like “brilliant”, “talented” and even “genius” to describe Trump.
Russia exports more than $15 billion in arms annually, second only to the US, and the country has a long history of producing high class weaponry at every level from firearms to supersonic fighter jets, long range missiles and nuclear-powered submarines.
On a lighter note, Russia also has a booming tourist industry, with 33 million visitors annually, the ninth most in the world. Popular tourist attractions include the legendary Trans-Siberian Railway, the Golden Ring of ancient cities and cruising on the River Volga. Russia has 23 UNESCO World Heritage Sites, with more still on UNESCO’s tentative list.
- Official Language: Russian
- Capital City: Moscow
- Largest City: Moscow (Pop: 14.3 million)
- Surface Area: 17,075,200 km
- Religion: 41% Russian Orthodoxy
- Population: 144.2 million
- Government: Federal semi-presidential constitutional republic
- Legal system: Constitution of Russia, the Code of Criminal Procedure, and the 1996 Federal Constitutional Law
- Currency: Russian Ruble
- GDP per capita: $25,185
- Climate: Warm to hot dry summers, very cold winters
Russian Foreign Investor Visa Program
In 2015, the Russian government unveiled their economic investor visa program. While not officially a citizenship by investment program, it is very similar, and Russian citizenship can be attained in just three years. Foreign investors can become Russian residents and then citizens by virtue of a financial donation, a real estate purchase or a profitable business investment.
Requirements of Investor
A potential investor must be able to provide the following fully authorized documents before proceeding with their application:
- Authorized proof of the applicant’s excellent health and medical insurance
- Authorized proof the applicant has no criminal record
- Authorized proof of the legality of the applicant’s funds to be used
- Authorized copies of the applicant and their family member’s passports
- Authorized proof of the applicant and spouse’s marriage certificate if applicable
- Authorized copy of the applicant’s original birth certificate
To be eligible for the Russian investor visa and eventual citizenship, an applicant must be able to fulfil one of the following investment options:
- Make a non-refundable charitable donation of 7.5 million rubles (approx. $128,000) to a specified Russian National fund (or)
- Make a 15 million ruble (approx. $256,000) investment into a Russian real estate project (or)
- Make a 35 million ruble (approx. $600, 000) business investment (or)
- Run a business in Russia that generates 10 million rubles ($171,000) per year for three years
Key Benefits Of The Russian Investor Visa Program
The Russian investor visa has multiple benefits, some obvious and others less so. Here are just a few of them.
- After three years of maintaining one of the investment options, full Russian citizenship can be obtained at no additional cost
- An application is also valid for the investor’s spouse and family at no extra cost
- At minimum cost of just $128,000, the Russian investor program is one of the cheapest options available to obtain residency/second citizenship
- The application and receipt of the investor’s Russian citizenship and passport can be undertaken at any official Russian office in a foreign country
- Even if Russian citizenship is not obtained, investors can live, work and run a business in Russia, and receive full access to Russian healthcare and education system
- Russian taxation is the lowest in Europe; corporate tax is just 20% while individual tax is only 13% for residents
- Moscow is one of the key business and cultural hubs for all of Europe and Asia, and will become increasingly so with the UK – and London’s – imminent departure from the EU
Benefits Of Gaining Russian Citizenship
Russia is one of the largest, most influential and most important countries in the world, and as a result there are many benefits to owning Russian citizenship:
- A Russia passport provides visa-free and visa-on-arrival access to 105 countries worldwide. This includes the areas of Eastern Europe, Latin America, the offshore banking and tax-havens of the Caribbean and Central America, most of Southeast Asia, plus areas of Asia and Africa
- In 2010 Vladimir Putin stated that it was “quite possible” that Russia could join the EU and Eurozone “one day.” With the UK’s exit from the European Union, the EU’s powerbrokers will be looking for a major country to replace them, and it could boil down to a straight choice Turkey or Russia
- Vladimir Putin reportedly has an excellent relationship with German chancellor Angela Merkel. If Merkel retains the position as her country’s leader after the 2017 elections, it will strengthen Russia’s position in Europe
- French presidential candidate Marine Le Pen is also a Putin sympathizer, and was one of the few supportive voices when Russia annexed the Crimea in 2014
- US president Donald Trump and Putin have a mutual respect for each other, and that could usher in the best era of friendship between the two superpowers since Boris Yeltsin and Bill Clinton were drinking buddies
Pros and Cons of Living in Russia
Wealthy foreign investors that choose Russia as their base to live, work, create a successful, business and raise a family will be pleasantly surprised; the standard of living – particularly in Moscow and St. Petersburg – is very high, healthcare and education is readily available and of an excellent standard, and property is now much more affordable than it was five years ago.
Russia is a vast country that requires plenty of exploration, and no matter the interests of an individual and their family, Russia will satisfy them. Whether it be Russia’s rich history and cultural heritage that can be easily discovered in its museums, architecture and monuments, its breathtaking and unspoilt countryside, its lakes, rivers, mountains, forests and even deserts, few places on earth can match the rich diversity of Mother Russia.
The Russian winter can be particularly cold, and takes some getting used to. The Russian language is not the easiest to learn, although a large proportion of the population speak some English. There is a substantial difference between the standard of living in Russia’s major cities and towns, and the rest of the country.
Passport Reviewer Ranking: C+
There are many positives to be gleaned from the Russian foreign investor visa program; it’s minimum price of just $128,000 for a nonrefundable charitable donation makes it excellent value, and the fact that Russian citizenship and its passport is guaranteed after just three years of residency gives it a head start over virtually every other European investor visa program on the market.
The main thing holding it back right now is that there are few outright benefits to owning Russian citizenship compared to acquiring the citizenship of an EU country or even a Caribbean nation. As anyone with even a passing knowledge of how second citizenship works knows, an EU citizen is free to live and work in any European Union country they choose without restriction, and an EU passport grants its holder visa-free access to on average more than 160 countries.
Caribbean citizenship entitles its owner to super-low taxation and full use of that area’s legendary offshore banking system. The average Caribbean passport has visa-free access to around 130 countries, and a Caribbean citizen is free to live and work without restriction in any CARICOM (Caribbean Community) country. The Russian passport has access to 105 countries, which is still a big improvement on those of Saudi Arabia, China, India, and a whole host of countries from Asia, the Middle East and Africa, and if the EU and US starts doing more business with Russia, expect it’s visa-free quota to increase.
Right now Russia is a country with vast and almost untapped potential, and if the coming years sees a greater level of appreciation and respect toward it from the Europe and the USA, its citizenship and passport will become far more desirable, and far more expensive, so if a Russian passport is something you’d like, you should look into acquiring it sooner rather than later.