The CBI Index: overview of the methodology

The CBI Index is a rating system designed to measure the performance and appeal of global citizenship by investment programmes across a broad range of indicators. Its purpose is to provide a rigorous and systematic mechanism for assessing citizenship programmes, to facilitate the decision-making process for individuals considering them, and to bring value to the citizenship industry. 

The CBI Index assesses all countries with operational citizenship by investment programmes, which today include the following 13 nations: Antigua and Barbuda, Austria, Bulgaria, Cambodia, Cyprus, Dominica, Grenada, Jordan, Malta, St Lucia, St Kitts and Nevis, Turkey, and Vanuatu.

A primary methodological objective was to isolate factors that could satisfactorily measure programme features and jurisdictional desirability. Seven factors, or ‘pillars’, were identified for this purpose. The seven pillars that constitute the CBI Index include:

1. Freedom of Movement

2. Standard of Living

3. Minimum Investment Outlay

4. Mandatory Travel or Residence

5. Citizenship Timeline

6. Ease of Processing

7. Due Diligence

Arriving at an appropriate rating for the seven pillars involved a complex combination of benchmarking, statistical analysis, and comparative investigation. 

Each of the seven pillars is scored out of a maximum of 10 points, calculated on an averaging basis from the scores of composite indicators and sub-indicators. The maximum attainable score achievable by a programme is 70, with all final scores expressed in terms of a percentage of the total points available. For example, a perfect, 70-point score would be expressed as 100 per cent.

It should be noted that, due to the vast number of statistics, indicators, and sub-indicators available for analysis, no single approach exists for the rating of citizenship by investment programmes. In framing the CBI Index however, reliance was only placed on official sources and publications from institutions of the highest international standing and on the specialised input of industry experts, whose contributions and responses were used to obtain and interpret both qualitative and quantitative data used in the construction of the CBI Index. 

It should further be noted that, whenever possible, points were awarded on the basis of evidence from official sources and the letter of the law. Because announcements of changes to citizenship by investment programmes are often made many weeks and months in advance of their actual implementation, the CBI Index limits its evaluations to changes confirmed by governments themselves and associated legal facts. 

Pillar 1: Freedom of Movement

The Freedom of Movement Pillar measures a passport’s relative strength by the number of destinations to which it allows travel without restriction, and by the amount of prime business hubs to which it provides access. It is assumed, for the purposes of this pillar, that the passport used for travel is an ordinary passport, and not a diplomatic or service passport.

Freedom of movement within and between countries is of paramount importance to any individual seeking second citizenship. This holds true whether the individual wishes to travel for work purposes, to visit family, or for leisure.

Emphasis was placed on the total number of countries and territories that may be visited without applying for a visa. This included both visa-free and visa-on-arrival destinations, as neither require persons to receive a visa in advance of travel. Government and other official sources, including data from the United Nations World Tourism Organisation (UNWTO), were used to obtain up-to-date information on visa requirements for holders of each of the 13 passports under evaluation.

As business travel is a prime consideration for prospective global citizens, a passport’s ability to provide access to the world’s leading economic and financial centres was also evaluated. The World Bank’s Ease of Doing Business Index, Forbes’ Best Countries for Business, the World Economic Forum’s Global Competitiveness Report, and other authoritative sources were used to arrive at a list of the top centres for international business. 

For both indicators, points were awarded on a descending scale, with the highest score received by the passport with visa-free or visa-upon-arrival entry to the highest number of foreign countries or territories.

Pillar 2: Standard of Living

The Standard of Living Pillar is a measure of the quality of life offered by the 13 citizenship by investment jurisdictions under assessment. This pillar is vital to those who yearn to relocate and to secure a prosperous and fulfilling lifestyle. Similarly, it is key to those wanting to take advantage of local business opportunities, or needing to transfer and safeguard their assets.

For this pillar, a wide range of official indicators were considered to allow for an accurate assessment. Consequently, establishing an appropriate benchmark was of paramount importance, as a country’s score must be viewed both as an absolute value, and within the context of the other citizenship by investment countries – that is to say, as a relative value.

Reliance was placed on the United Nations Human Development Index (HDI) for factors such as life expectancy, education, security, and income.

Because past performance is not always a guarantee of future results in the field of economic growth in a rapidly developing world, a country’s latest annual GDP growth statistics were used to indicate present-day economic circumstances as well as growth potential – a particularly important indicator for investors. Data was sourced from the World Bank's Open Data Catalogue to ensure accuracy and consistency.

The Standard of Living Pillar also examines a country’s ability to promote freedom, and to protect the rights of individuals to act and to express themselves without undue constraints. Civil liberties and political rights within a jurisdiction were rated as part of this exercise, using sources such as Freedom House’s Freedom in the World Index.

Pillar 3: Minimum Investment Outlay

The Minimum Investment Outlay Pillar measures one of the most practical and foremost considerations of citizenship by investment: how much capital is required for the investor to become an eligible applicant for the programme of his or her choosing.

The cost of applying for citizenship by investment increases with the number of dependants – or qualifying family members – included in an application. In some jurisdictions this increase is proportional, while in others the cost only increases following the inclusion of multiple dependants. To remain consistent across all jurisdictions, it was assumed that one applicant was applying for citizenship alone. That is to say, that the application consisted of a ‘single applicant’.

Where a citizenship by investment programme offers multiple investment options, the most affordable option was selected for evaluation. For example, Dominica offers a single applicant the choice between a contribution to the Economic Diversification Fund (EDF) and an investment in pre-approved real estate, with the latter being the more expensive alternative. The EDF option was therefore used to determine the minimum investment outlay for the Dominica Citizenship by Investment Programme.

This pillar considers pure investment requirements, exclusive of minor fees that may also apply. These may include application, processing, or due diligence fees that do not significantly alter the cost of a citizenship application.

The highest number of points was awarded to the country requiring the lowest minimum investment. 

Pillar 4: Mandatory Travel or Residence

The Mandatory Travel or Residence Pillar examines the travel or residence conditions imposed on applicants both before and after the granting of full citizenship. Often busy with running a business or with international travel of their own, citizens of the world have little time on their hands to fulfil minimum stay requirements.

A careful examination of the laws, regulations, and policies pertaining to each citizenship by investment programme was undertaken. First, it was determined whether any travel or residence prerequisites applied. Second, post-citizenship requirements were examined, as well as the consequences of failing to fulfil those requirements. Third, the extent of the travel or residence requirements were analysed, with physical visits for the purposes of attending an interview, swearing an oath of allegiance, or giving biometric information all taken into account. Additionally, mandatory travel that could only be waived or eased following the payment of a costly fee was also given consideration.

In line with previous pillars, scrutiny focused on the main applicant rather than any dependants that may be included in the citizenship application. 

As having year-round freedom to travel is a highly-valued liberty, programmes that waived residence and travel requirements achieved the best score, followed by those with minimal requirements. The lowest scores were attained by programmes with extensive requirements. 

Pillar 5: Citizenship Timeline

The Citizenship Timeline Pillar looks at the average time it takes for citizenship to be secured by the applicant. 

The speed at which application forms and supporting documentation are processed, and the steps involved in approving an application, vary from programme to programme. Therefore, a thorough inspection of applicable laws, regulations, and policies was made to determine the official processing times mandated by each jurisdiction. 

Extensive reliance was also placed on first-hand experience from applicants, agents, and other stakeholders, whose contributions proved to be an invaluable tool in ascertaining citizenship timelines.

As one of the key merits of citizenship by investment programmes is their ability to provide a rapid route to second citizenship, the highest number of points was awarded to the programmes with the shortest turnaround times.

Additional merit was given to programmes offering fast-track processing options at an additional fee, as these provide an extra layer of certainty for the applicant who is urgently in need of his or her second citizenship.

Pillar 6: Ease of Processing

The Ease of Processing Pillar measures the end-to-end complexity of the citizenship by investment application process. In some jurisdictions, the application process can be a labour-intensive and painstaking task that is time-consuming for the applicant; in others, it is streamlined and the applicant receives clear directives on how to proceed. For the ever-busy, internationally-minded individual, the overall effortlessness of the application process is a particularly critical component and a smoother, hassle-free process can generate readiness to engage with a programme.

Multiple indicators were considered, commencing with entry qualifications such as previous business experience or fluency in a language. Knowledge of local history or culture assessments and interview requirements were also weighed. 

By its very nature as a naturalisation process, citizenship by investment involves a significant amount of paperwork, including both forms and supporting documents. Having the support of an official government website and of a dedicated citizenship by investment unit to seek and obtain clarification was thus an influential factor in awarding points to a programme.

Extensive communication with advisors and legal experts is required where a jurisdiction mandates the purchase of real estate or other assets, and hefty paperwork must also be submitted as evidence of that purchase. Therefore, countries with compulsory purchasing requisites were deemed to burden the application process.

The stability of each programme was also assessed, as applicants and service providers prize continuity throughout the application process. 

Programmes with fewer demands placed on the applicant and with relatively straightforward procedures achieved higher scores for this pillar. 

Pillar 7: Due Diligence

The Due Diligence Pillar focuses on each nation’s commitment to ensuring that their programme remains transparent and effective at evaluating potential candidates for citizenship. It is hence a measure of each programme’s integrity.

The CBI Index focuses on the ability of governments to obtain information on and from applicants, such as by the performance of internal and external due diligence checks. Further indicators included police certificate requirements – including the number of nations from which a certificate must be provided – as well as requests for fingerprints or biometric data.

Emphasis was placed on a country’s ability to gather evidence on the applicant’s source of funds, as this is a core step in preventing those profiting from, or involved in the financing of, illicit activity from obtaining citizenship.

Increasingly, strict anti-terrorism and anti-money laundering (AML) legislation has prompted some governments to exclude persons of certain nationalities from their programmes, or to restrict funds transferred from certain jurisdictions in order to ensure compliance with international sanctions. These trends are included among this pillar’s indicators.

The greater a country’s ability to perform background checks on applicants, the higher the score received.  

The researcher

The CBI Index was created by James McKay, a research consultant with more than a decade’s experience in the design and execution of complex research and data analysis projects. 

Having read psychology and statistics at University College London, the founder of McKay Research provides market intelligence and consultation across a wide range of sectors, and actively works with some of the world’s biggest independent providers of strategic market research across several industries including commodities, investment, pharmaceuticals, and consumer goods.

James, who used guidance from the OECD’s Handbook on Constructing Composite Indicators, employed a three-stage process to produce the latest version of the CBI Index. 

The first phase involved comprehensive primary and secondary research to chart all major developments in the world of economic citizenship over the past 12 months. 

The second phase comprised a detailed exploration of official macroeconomic and programme  statistics used in evaluating CBI Index country performance. 

The third and final stage involved critically analysing and inputting all data collected throughout the research process, paying careful attention to maintaining the statistical continuity and integrity of the original index architecture. 

Now celebrating its second anniversary, the CBI Index is rapidly becoming the leading tool for investors to accurately measure the performance and appeal of global citizenship by investment programmes.