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Portugal offers golden visas to rich foreigners

Buying a property for €500,000 or more qualifies the owner for a five-year stay in the European Union.

Pascal Gonçalves, who started the Casa em Portugal (House in Portugal) estate agent's, soon realised that the future of his venture depended on what happened abroad. Debt and austerity measures were threatening to swamp his business in Lisbon, Oporto and on the Algarve coast.

So in 2010 he opened a branch in Paris, and another one in São Paulo, Brazil, the following year. In 2012 he opted for Caracas and Luanda, the capital cities of Venezuela and Angola, respectively. He told them about the attractive houses and flats in his home country, with their characteristic azulejos (painted, tin-glazed) tiles.

In October 2012 Pedro Passos Coelho's centre-right government introduced the vistos dourados (golden visas) scheme in a bid to boost VAT revenue and halt the drain on capital. Foreigners purchasing property worth more than €500,000 ($685,000) would qualify for a five-year visa to Portugal, and consequently the European Union. Gonçalves had backed the right horse.

"Since then we've been booming," Gonçalves says with a smile. So much so that in July he hired Yansi Xu to represent the firm in Shanghai.

"The Chinese are our best customers, ahead of Brazilians and Angolans," he adds.

Buying property is not the only way of qualifying for a visa and access to the Schengen area. Another option is to make an investment exceeding €1m or giving rise to 10 new jobs in Portugal.

The rules, published a year ago, took some time to gain public attention, but middle-class buyers in emerging countries have certainly got the message. According to the Portuguese foreign ministry, quoted by AFP, 356 residence permits have been granted to investors, including 279 Chinese, 16 Russians, 10 Brazilians and nine Angolans.

This adds up to about €222m invested in Portugal. "It's crazy," says Michel Veloso Viera, a lawyer who assists foreigners with the paperwork. "I'm getting an average of 10 applications a week from Chinese families."

Nor is Portugal the only country to be soliciting rich immigrants. Spain, Cyprus, Greece and the Netherlands have deployed similar schemes, in a bid to make up for falling investment, fill homes left vacant by the crisis and kickstart consumption.

At a time when immigration is such a sensitive issue, this initiative, endorsed by Brussels, may seem surprising. Particularly as after five years a golden visa may lead to Portuguese nationality, Veloso Viera explains.

Yet there has been little criticism of the scheme in Lisbon, apart from the leader of the far-right National Renovator party, José Pinto-Coelho, who claims that his country is "prostituting itself". So far even the Socialist opposition has tacitly approved the move. "We're adopting a cautious stance. The origin of funds must be checked, but it does encourage foreign investors, and if it can help our country ..." says the Socialist spokesperson on economic affairs.

The priority is to get Portugal back on its feet. Having survived since 2011, thanks to financial assistance worth €78bn from the International Monetary Fund, the European Central Bank and Brussels, the country is keen to see the back of the troika as soon as possible.

On the whole the Portuguese do not resent the tax breaks awarded to foreigners, even inside the EU. Although families are suffering from austerity policies, which have axed bonuses and increased tax, they are not unduly bothered by the idea that physicians, architects, senior executives and company directors – and all the others on the list of high added-value professions – settling in the country should qualify for a 20% cap on income tax.

In France, where exasperation at rising taxes is particularly acute, the scheme seems appealing. "There's not been a sudden rush, but certainly growing interest," says Carlos Vinhas Pereira, the head of the Franco-Portuguese Chamber of Commerce and Industry.

Olivier, who operates a string of salad bars in fashionable Paris neighbourhoods, is adamant that the tax incentives did not prompt him to "drop everything" and start the same venture in Lisbon, about which he knew nothing a year ago. It all started, he maintains, with a national insurance inspection last January during which he and his employee were "treated like dirt".

He was so disgusted he decided to move to Portugal, citing the "booming travel trade" in Lisbon, but also the "low wages, sunshine, cheap rents" and direct flights several times a day. Sufficient to convince him to leave with his wife and children in January.

Tourists once again return to Portugal

LISBON – The famous No. 28 tram, winding its way through the narrow streets of Lisbon, is packed.

Foreign tourists are flocking to Lisbon, as well as the southern coastal Algarve region — and that’s just the shot in the arm that the crisis-hit country needs.

“In the past few months, tourism in Portugal has seen its biggest growth in recent years,” said Economy Minister Antonio Pires de Lima of the nearly 10 percent increase.

In the first half of 2013 alone, the income generated by foreign tourists grew 8.2 percent to €3.7 billion ($4.9 billion).

There were 3.8 percent fewer visitors from neighboring Spain, which has also been hard-hit by the economic crisis.

More than making up for that, however, was the rise in the number of Americans, Germans and French visitors (16.8, 14.0 and 10.8 percent, respectively).

Christian Fievre, a retired craftsman from the French city of Orleans, strolled with his wife, Maryse, down the capital’s magnificent Avenida da Liberdade, a wide boulevard divided by a pedestrian pavement with gardens.

“We hesitated between Barcelona, Rome and Athens, but Greece is struggling,” he said. “Here, you don’t get the feeling of being in a country in crisis.

“They are going to get through it, these are hardworking people who never complain,” he added. “Traveling here is a way of helping them.”

Tourism, accounting for 9.2 percent of GDP, “is the sector that has most contributed to getting Portugal out of the crisis,” said Adolfo Mesquita Nunes, a junior economics minister in charge of tourism.

After 2½ years of recession that has wiped about 5 percent off GDP, Portugal moved back into growth in the second quarter with an expansion of 1.1 percent. The flow of tourists into the country gave a boost to national carrier TAP, which in August carried 1.11 million passengers, the highest monthly figure they have registered.

Things are also looking up in the hotel industry. “We registered between 5 and 10 percent more clients than last year, mainly from the U.S., France and Germany,” said Carlos Jesus, co-manager of the Albergaria Senhora do Monte hotel, perched on one of the seven hills of Lisbon.

In terms of takings, however, it still has some way to go before it gets back to the boom years.

In all, 3.6 million foreign tourists visited Portugal in the first half of the year, an increase of 8.1 percent.

The country had been the beneficiary of unrest in rival tourist destinations such as Egypt and Tunisia, said Frederico Costa, president of Turismo de Portugal. “Security has played an important role,” said Costa, whose organization has the job of promoting tourism in his country. “We have picked up tourists who abandoned these destinations.”

Costa said lower prices, a factor many visitors cite when explaining why they were tempted to visit, is not the most decisive criterion — especially given that room rates in the hotels are beginning to rise again.

Portugal is not comfortable with attempts to label it a “low-cost” destination: it has developed luxury hotels, built a reputation as a golfing destination and has also worked to promote cultural tourism. Eating out won’t cost you an arm and a leg, however.

“Portugal is cheaper than Japan,” said Masako Matsuda, an insurance company employee who made the 17-hour flight over from Osaka. “You eat well and the portions are enormous.”

The southern beaches have also enjoyed a revival: Visits from British, French and German tourists were all up (10.4, 37.9 and 21.8 percent, respectively).

But Eliderico Viegas, president of the AHETA, Algarve’s hotel association, added a cautionary note. “Rates of occupation have certainly increased, but the takings don’t necessarily follow,” he said. “Prices are lower and the tourists are spending less.”

http://www.japantimes.co.jp/news/2013/09/11/business/tourists-once-again-return-to-portugal/#.UwZF4fl_uTU

The Golden Residence Permit program has mainly attracted Chinese businessmen wishing to invest in Portugal. According to the Consul General of Portugal in Macau and Hong Kong, Vítor Sereno, EUR143 million has been invested so far, with EUR106 million coming from China.
In a recent presentation, Mr Sereno revealed the latest figures of the new residence permit regime launched early this year. “We a have a total of EUR143 million invested, meaning that 226 visas were granted, with 168 through diplomatic representation of People’s Republic of China. This means that around 75 percent of these GRP was granted to China,” the Consul General stressed. 
30 to 35 percent of the Chinese investment comes from Macau and Hong Kong. The so-called Golden Visa entitles non-European Union citizens to request a residence permit in Portugal for themselves and close family members, if they invest in Portugal. Options range from the transfer of capital equal to or higher than EUR1 million, the creation of 10 work positions, or the purchase of real estate with a minimum value of EUR500,000. The latter is the most common method of acquiring the Golden Residence Permit. So far, Macau and Hong Kong have yielded EUR33 million to Portugal. 
Vítor Sereno emphasized that behind these numbers lies an effort of several Portuguese diplomatic missions. “It shows that the diplomatic representatives have been working well. In my mission here in Macau, one of the aspects I wanted to work on was the economic sector, particularly the promotion of the Golden Residence Permit,” he stated. 
The Consul General added that after six months he still believes the task “hasn’t been completed yet”. “I am an ambitious person, so we will continue to work along this path,” Vítor Sereno promised.
During the session last week, real estate companies and law firms from Portugal had an opportunity to present their services to prospective investors. Law firm Garrigues, for instance, presented its “Golden Visa expertise with competitive prices.” Lawyer Miguel Marques dos Santos explained how the firm is able to help those interested in applying for the Golden Visa. 
Emphasizing that Portugal is located in a very “strategic position between America and Africa”, it also offers an “attractive tax framework,” the lawyer guaranteed, explaining that those who are granted the visa will benefit from wealth, inheritance and tax exemption on gifts. Moreover, he stressed that with the coming tax reform, companies are expected to benefit from tax reductions as well. 
In addition, the lawyer elaborated on the immigration procedures, explaining the different steps in the application process when purchasing property. The Golden Residence Permit is initially granted for a period of one year; it can subsequently be renewed for two years. After five years, one is entitled to request permanent residency. 
During his speech, Vítor Sereno also highlighted some aspects of the country which investors might find attractive: strategic location, sunlight, safe environment, Portuguese language (the 5th most spoken in the world), easy access to other European Union countries, good infrastructure and free movement within the Schengen area. The Consul General in Hong Kong and Macau also underlined the role played by Portugal’s personalities in different fields, from Cristiano Ronaldo and José Mourinho (football) to Joana Vasconcelos (plastic arts) and Siza Vieira (architecture), as well as Danieal Ruah (television). 
The Golden Residence Permit will soon be presented at a similar event in Shanghai. Staff reporter

Vítor Sereno to represent Portugal at Forum Macau

The Consul General in Macau and Hong Kong, Vítor Sereno, is due to represent Portugal in the Forum for Economic and Trade Cooperation between China and the Portuguese-speaking countries, commonly known as Forum Macau. According to the Portuguese news agency Lusa and Radio Macau, the decision has been made and publicized through the Portuguese ambassador in Beijing. 
According to Lusa, an unidentified source revealed that Vítor Sereno was chosen because he will work toward “enhancing the importance Portugal can give to the Forum and [strengthen] Macau’s role as a platform between China and the Portuguese speaking countries.”  
The same source has also emphasized that Portugal’s choice reinforces its importance to Forum Macau and its commitment to investing in Macau’s market. 
Vítor Sereno has confirmed his appointment as Portugal’s Forum Macau representative with Radio Macau. He will work closely with the delegate of the Agency for Investment and External Commerce in Portugal, Maria João Bonifácio. 
The 5th Ministerial Forum Macau Conference will be held in the territory between 5 and 6 November. 

http://www.macaudailytimes.com.mo/macau/47678-china-leads-golden-visa-program-in-portugal.html