Has the golden visa program fulfilled its role?

The Golden Visa program in Portugal is very lucrative and at the same time much-criticized residency by-investment program for people from non-EU countries.

To obtain such a ‘golden’ permit one has to invest at least half a million euros in property, in exchange for permanent residency and unimpeded visa-free travel throughout the EU. Unlike Malta and Cyprus, Portugal doesn’t confer golden visa applicants with Portuguese citizenship i.e. passport.

Last October the Authorisation of Residence for Investment (ARI) – as the program is officially called – celebrated its 10th anniversary. The scheme is heavily criticized for some time. Both at home – for sending house prices and rents up, particularly in Lisbon – and by Brussels as it poses a risk to the security of the EU as a whole.

Since the creation of the program in 2012 a total of 11,535 residence permits have been granted, according to the Immigration and Border Service (SEF). Moreover, 18,808 residence permits have been issued to family members during those ten years.

The program has attracted 6.754 billion euros in investment by foreigners mainly from China (45%), Brazil (10%), Turkey (5%), the USA (5%), and South Africa (5%), with the bulk (over 90%) going into real estate.

Golden residence permits for foreigners in Portugal no longer make sense, according to the British journalist Oliver Bullough and author of the book ‘Butler to the World’ telling news agency Lusa: ’I can understand the golden visa program in the circumstances in which the country introduced the policy, after the financial crisis in 2012 but not why it continues because it attracts people who want to hide money or evade taxes.’

Portugal’s former Socialist Member of the European Parliament Ana Gomes, a strident voice against corruption in the country, also strongly condemns the policy. ‘Golden visas are a form of prostitution of the Schengen system that gives kleptocrats, criminals and money launderers a fast track into Europe’.

Although the Government changed the law for golden visas to redirect investments from the two largest cities (Lisbon and Porto) and the Algarve coast to rural areas early last year, the weight of foreigners on the residential market in Lisbon hasn’t decreased.

In 2022 there were 808 authorizations given for the purchase of properties. Only 61 (7,5%) were located in low-density areas and Lisbon alone concentrated almost half of the properties transacted.

Prime Minister Antonio Costa declared in November at Lisbon’s Web Summit that the country is likely to scrap its golden visa program as the 10-year-old scheme has fulfilled its role and may no longer be justified.

It will be clear, however, that the last word has not been said about a program that does make the country such easy money.

Enjoy the week                     Aproveite a semana               pic Publico/Sapo

‘Basically same place, same art, different name’

Lisbon’s Centro Cultural de Belém (CCB) – the city’s main cultural centre – is to open a new museum of Modern and Contemporary Art, the MAC-CCB, in the space previously occupied by the Berardo Collection Museum.

Besides a different name, visitors won’t be noticing any change. ‘It will be possible to visit the art collection amassed by the Madeiran art impresario Joe Berardo just as it has always been’, according to Portugal’s minister of culture, Pedro Adão Silva.

The Portuguese state stepped in to safeguard access to Berardo’s vast art collection after three banks filed a lawsuit to recover debts from the businessman. The enormous collection – including works by Miró, Mondrian, and Francis Bacon – was valued in 2006 at 320 million but is worth more than twice now.

The story began in 2016 when the judicial police (PJ) started investigating an economic group financing operations with State bank CGD in 2006-2009 to a value of around 439 million euros. Berardo’s involvement in this group has been a focus for the media and the government ever since.

In 2021 he was arrested on suspicion of a multimillion fraud against State bank CGD, tax fraud and money laundering and is currently on the largest bail ever in the country (5 million). According to the PJ the group of which Berardo was a part, did not repay the loans to CGD and ‘resorted to mechanisms of renegotiation and debt-restructuring in order to avoid ever having to pay back the money’.

To date, the group has caused almost a billion euros in damages to three banks: CGD, Novo Banco, and Millennium (BCP). The impresario used the art collection as security for all three loans when in fact he doesn’t even own it.

Last year the Government started a process of the extinction of the Berardo Foundation, in better days reverted to its work in promoting arts until it became horribly clear that its patron, the 78-year-old Joe Berardo – once hailed as one of the richest men in the country and holding high honours –  was not running the foundation correctly.

In 1985 he was given the Order of the Infante by then-president Ramalho Eanes and in 2004 received the Grand Cross of the same order from president Jorge Sampaio. In the meantime, Manuela Ferreira Leite, former finance minister and president of the Council of National Orders, is working on the honours to be removed.

It is the first time the government has taken such a drastic step – i.e. extinguishing a private foundation – as the trust promoted activities outside its legal scope and used the funds for the benefit of the tycoons’ family.

MAC-CCB won’t just include the Berardo Collection but also the Elipse Collection, compiled by the corrupt BPP banker João Rendeiro, who fled the country and died last year in a South African jail.  

Enjoy the new year         Approveite o ano novo          (pics Publico/Sapo)