Bob Bauman (September 8, 2010)

Until a few weeks ago only two countries in the world offered citizenship for sale – St. Kitts & Nevis and the Commonwealth of Dominica, both small eastern Caribbean island nations located in what in colonial days was known as the British West Indies.

Now Europe’s newest (2006) independent nation, Montenegro, has announced that it too will sell what is euphemistically known as “economic citizenship.” The country’s history dates back to Byzantine times.

Tiny (5,019 sq mi; pop. 672,180) Montenegro, located in southeastern Europe, across from Italy between the Adriatic Sea and its former partner, Serbia, has hung out the “For Sale” sign.

Foreign businesspeople are being offered citizenship in return for investing in the country, according to a government spokesperson, who said the Economic Citizenship Program for “internationally known businesspeople of good reputation” would allow investors to obtain a Montenegrin passport which allow visa-free travel to more than 85 countries and territories worldwide.

Since independence, Montenegro has grown, sparked by foreign investment mainly from wealthy Russians comfortable with its Slavic culture, scenic coastline, visa-free EU travel and confidential offshore banking laws. But the country is very poor, with a 2009 GDP of only US$6.6 billion and a per capita annual GDP of $9,800.

High Cost Passport

The cost of this newest instant citizenship €500,000 (US$635,000) is much higher than either of its competitors. With some variation in prices, Dominica charges about $150,000 and St. Kitts about up to $350,000, depending on the number of persons in a family.

Henley & Partners, specialists in second citizenship, say under the program you either must invest €1.5 million (US$1.9 million) in real estate from an approved real estate developer, or invest €300,000 (US$380,000) in approved real as well as making a €200,000 (US$254,000) non-refundable contribution to the Treasury of Montenegro.

“With this program we hope to attract additional investors, individuals and capital which will help build a positive image of our country in the financial world,” said a spokesman, who denied the program could “turn Montenegro into an asylum for criminals.”

Respectable Only

The government said it would co-operate with leading law firms and consulting companies to ensure that people applying would have a respectable background.

Maybe so, but rumors have circulated for some time that Montenegro passports were being made available to foreign wealthy investors. One of the better known is former Thai Prime Minister Thaksin Shinawatra who now travels on a Montenegro passport.

Mr Shinawatra was convicted in absentia on corruption charges that he denies, He has announced plans to invest in Montenegro, possibly in some of the luxury coastal hotels where he has been reported as staying.