New Zealand‘s coalition government has recently relaxed the requirements for its Active Investor Plus visa, popularly known as the golden visa. In February, we made this process much easier to lure in powerful foreign investors. After all, our purpose is to help revitalize our country’s economy, which took a deep hit during the Covid-19 pandemic. The right-wing coalition is certainly hoping to jumpstart economic growth with this multinational corporation-friendly move. They’re facing New Zealand’s largest projected GDP contraction (by a long shot) of any developed country in 2024.
The golden visa provides residency to wealthy foreigners prepared to invest millions of dollars in New Zealand. The relaxation of the visa stipulations is an attempt to increase migration of investors and foster economic growth. As per the new regulations, an applicant can prove residency if they invest at least $5 million within a three year period. Or they can commit $10 million in investments over five years. Until now, these requirements were much more strict, with a higher minimum investment and a three-year residency requirement.
Since the new rules came into effect in April, Immigration New Zealand has been inundated with applications. Their received 189 applications from 609 people. This is quite a change from the time before, when only 116 applications were filed in 2.5 years. This is especially true as almost half of the new applicants are from the United States, with America filing 85 applications. Other notable interest has come from China and Hong Kong, with 26 and 24 applications, respectively.
Just a few months later, the government chose to relax these restrictions after a very public and contentious episode involving billionaire entrepreneur Peter Thiel. He had citizenship in 2017, obtained after living only 12 days in the country. This tragedy prompted former Labour Prime Minister Jacinda Ardern to act in 2018. For one, she cracked down on investor visas and restricted foreign homeownership.
Economic Growth Minister Nicola Willis emphasized the potential economic benefits of the new visa rules, stating that they could represent “a potential $845 million of new investment in New Zealand business.” One key point she made is that new investors add more value than just their check. Along with that they bring the skills, knowledge and experience necessary to power the next economic boom.
Demand for New Zealand’s golden visa has skyrocketed with Trump-weary Americans looking for an out as country becomes more divided by race, by politics, even by COVID-19. Stuart Nash highlighted this trend, noting, “Nearly everyone who is applying is applying because of the changes they’re seeing under the [Trump administration].” He further added, “We are seeing more people looking for a safe haven than a tax haven – and that’s what we have got here in New Zealand.”
Its attraction is not only about maximising investment returns, it appeals to those looking to their legacy, their longer term footprint. Benny Goodman remarked on this unique combination, stating, “This is a rare combination, and one that deeply resonates with investors thinking about legacy, not just returns.”
Immigration New Zealand has processed 100 applications in principle since loosening the rules came into effect. To date, seven investors have successfully completed the transfer of their funds, immediately introducing $45 million into the country.
New Zealand, for its part, is making ambitious moves to steer its economic recovery from the pandemic. The golden visa program is thus crucial for the government to attract required foreign investment as well as fulfilling the needs of wealthy individuals looking for stability and opportunity.