Vanuatu’s New CBI Program: Coconut Oil Fund to Yield Annual Returns, Partial Redemption of Principal

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Vanuatu has operated several citizenship by investment programs over the years, and often several simultaneously. Until last week, the program had (at least) three different programs:

• The Vanuatu Development Support Program (V-DSP)
  Starting at $130,000, this program is the only one of the three that had multiple approved agents.
• The Vanuatu Contribution Program (VCP)
  This program has the same pricing structure as the V-DSP, but with a single approved master agent (“Jimmy from Hong Kong”)
• The Vanuatu Real Estate Option Program (REO)
  Approved in 2021, this program offers citizenship in Vanuatu in exchange for an investment in approved real estate projects for a minimum of US$100,000 each.

Last week during a formal event in Bangkok, Vanuatu launched a fourth CBI program: A revived version of the CIIP – the Capital Investment Immigration Plan, which was operational between 2014 and 2016 – that offers citizenship in Vanuatu in exchange for investments in a coconut oil (CNO) focused investment fund.

Applicants and families of up to four members may qualify through an all-inclusive contribution of US$138,000.

Speaking directly to IMI, Daniel Agius – COO of the Vanuatu Investment Migration Bureau (VIMB), the sole master agent for the new program – explained that the new program is based on the original legislation for the CIIP, which has been suspended since 2016 but which is now revived “with some additional provisions to enable investment-linked qualification rather than donation-based qualification.”

VIMB explains that while it is the sole designated agent, other companies may promote the program as sub-agents. This is also true for agents already approved under the VDSP.

Annual returns and at least half your money back in five years

The CNO Future Fund promises “annual ROI and redemption value in five years”. Questioned as to what this means in practice, Agius responds that the fund has a “conservative return target” of 5% p.a. on the net investment amount (not all of the US$138,000 will be invested in the fund, as some will go to pay government and agent fees). Agius explains the investor would be able to receive the net investment amount, plus capital appreciation, after five years: “We anticipate at least US$70,000 will be returned on each application,” comments Agius.

In other words, applicants can expect to get at least half their money back after five years, with interest.

The focus of the new program, he adds, is on “value-adding in the coconut/copra industry to create coconut oil, which will then be used to replace 100% of the diesel used in the production fo electricity in Vanuatu.” This focus, he points out, “aligns with Vanuatu’s Net Zero 2030 targets and the government’s strategic plan.”

According to a VIMB press release, the fund will make profits by “curating a diversified investment portfolio focused on enhancing and growing local CNO products and sectors. The goal is to reduce the dependency on imported fossil fuels for electricity generation.”

Agius also emphasizes that the new program is “an alternative option to the VDSP and is certainly not designed to replace it. In fact, we’re only targeting the processing of 120 cases a year[…]. We aim to attract those who are looking at investment-backed options, as opposed to the donation option.”

Robin Kapapa, Chairman of Vanuatu’s Citizenship Commission, commented that the new program would “demonstrate the real value-add of citizens.”

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