Vanuatu Citizenship Program Without Schengen-Access: What Happens Next?

On March 3rd, the European Commission announced it would partially suspend its visa waiver agreement with Vanuatu, and that the suspension would take effect in the first week of May.

IMI reached out to well-known program stakeholders James Harris – of the Vanuatu Investment Migration Bureau – and Martin St-Hilaire – of AJC Vanuatu, to gauge their reactions and their expectations for citizenship by investment in Vanuatu in the immediate – and distant – future.

Pandemic prevented crucial conversations with the EU

“The EU’s decision is indeed unwelcome news, but it is not exactly the whole story,” says Harris. “The EU has asked, over an extended period of time, for Vanuatu to address concerns regarding the Citizenship Program – in particular regarding due diligence. Unfortunately, the speed of progress in this regard has been hampered – first by a change in government, and then by Covid 19.”

Vanuatu hermetically sealed itself off from the outside world during the pandemic, which has made in-person meetings with groups that might have helped it stave off this suspension impossible.

“Vanuatu is in need of international third-party advice and support for the re-shaping of the Program but, has had to pursue and progress this remotely without the benefit of face-to-face meetings to build understanding and a cohesive strategy,” Harris points out. “Likewise, communication with the EU has been conducted entirely without the benefit of physical ’round-table’ discussions, which would undoubtedly have enabled faster progress.”

Fat lady silent until May

He emphasizes that the EU’s directive is a suspension rather than an outright cancellation, which leaves the door open for a visa-waiver reinstatement at a later stage, should Vanuatu be able to adequately address the EU’s concerns. Harris thinks there’s a chance Vanuatu could make that happen before the suspension takes effect in May.

“It is now attendant on Vanuatu to work with all haste, and with all resources it can bring to bear, to ensure that in eight weeks’ time, the grounds for implementing the visa-privilege suspension have been removed.”

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Calling the event a “huge wake-up call” for Vanuatu that represents “a considerable challenge”, Harris says he is optimistic and believes “the elements of a remedy already exist, including the appointment of at least one international due diligence firm and one government advisor, and just need to be rapidly assembled from here.”

Forced to choose between Schengen-access and CBI

St-Hilaire does not share Harris’ sanguine outlook:

“I think it is a final decision,” he says. “I was hoping that politically, behind the scenes, common sense would have prevailed. But now that the Commission has recommended it and the Council has supported it? It is now difficult to reverse the situation because, now, to remove that suspension, the Commission must recommend the removal, and then the Council must approve it. That would take months and, with the specific point raised about physical presence, or country of origin, I do not see any way to please the EU other than stopping the whole program.”

Questioned as to what, if anything, Vanuatu is now doing to have the suspension called off, St-Hilaire indicates he doesn’t think there’s much that can be done because the political climate precludes it.

“I don’t think anything will happen soon,” he says. “The worldwide trend is towards protectionism and nationalism. Populism makes it easy and politically worthy for rich powerful nations to cut off small developing nations like Vanuatu. It is all about the narrative value that makes visa suspension a really good cost/benefit thing to do for the EU and other rich and powerful nations. Governments use it as proof that they are doing something against the evil of the foreigner and of the foreign nation.”

Christian Henrik Nesheim AdministratorKeymaster

Christian Henrik Nesheim is the founder and editor of Investment Migration Insider, the #1 magazine – online or offline – for residency and citizenship by investment. He is an internationally recognized expert, speaker, documentary producer, and writer on the subject of investment migration, whose work is cited in the Economist, Bloomberg, Fortune, Forbes, Newsweek, and Business Insider. Norwegian by birth, Christian has spent the last 16 years in the United States, China, Spain, and Portugal.

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