Despite facing numerous challenges in recent years, Vanuatu’s citizenship sale programs are experiencing unexpected growth, largely influenced by geopolitical instability. The citizenship-by-investment sector has emerged as the primary revenue generator for the Vanuatu government, even as integrity issues cast a shadow over its operations.
In 2024, Vanuatu became the first nation to lose its visa-free access to the European Union due to concerns surrounding its citizenship schemes. This led to fears of significant repercussions for the industry. However, agents involved in Vanuatu’s citizenship programs have reported that the loss of EU access has not greatly harmed their interests, citing the appealing aspects of their offerings and the ability for passport holders to still apply for entry into Europe.
On the other hand, being included on the EU’s anti-money laundering blacklist proves to be a more detrimental issue, according to Francesca Grillon from approved agent Yawha & Associates. The blacklisting presents challenges in receiving foreign currency funds, a situation exacerbated by the Commonwealth Bank of Australia’s decision to halt transfers for agents associated with the citizenship programs. Melten Menauke from Smart Citizenship Vanuatu stated that this has created hurdles for the government in managing the donations and fees paid by foreign applicants, with the National Bank of Vanuatu struggling to find a correspondent bank willing to accept funds in U.S. dollars.
Amid these financial complications, Vanuatu’s government initiated a Commission of Inquiry into the citizenship schemes in 2024, prompted by rising corruption concerns associated with the sale of citizenship. However, transparency remains an issue, as the inquiry report has yet to be released to the public, leading to calls for greater accountability.
Women Against Crime and Corruption chairperson Jenny Ligo voiced her concerns about the political manipulation of citizenship programs, asserting that the schemes need to be overseen by neutral parties to restore public trust.
Even as Vanuatu’s government grapples with challenges such as responding to natural disasters and pursuing vital political reforms, addressing the integrity of its citizenship-by-investment initiatives has become a focal point. Grillon noted that the government has taken steps to enhance compliance with international regulations, including bolstering the Financial Intelligence Unit responsible for screening applicants.
Performance indicators suggest that the citizenship sector is thriving, with citizenship sale receipts contributing significantly to Vanuatu’s fiscal health. Last year, the sector garnered approximately US$31 million, exceeding forecasts by 24.3%. Around 2,000 foreign nationals received citizenship during this period, with demand remaining strong from several foreign markets, including China, Indonesia, and Russia.
The appeal of the Vanuatu passport remains robust, as highlighted by designated agent Ros Stanford, who explained that clients are drawn to the potential for visa-free travel, tax advantages, or as a safeguard against global instability. With a noticeable increase in applicants seeking a reliable alternative residence, the continued interest in Vanuatu’s citizenship programs underscores their resilience in an ever-changing geopolitical landscape.
Even in the absence of EU visa-free access and the scrutiny from local citizens about its commodification, Vanuatu’s citizenship offerings are still in high demand. They are regarded as one of the fastest paths to citizenship available globally, reflecting the complex interplay of economic needs and individual aspirations in a rapidly evolving world.