Want to be Hungarian? Buy bonds of 250,000 euros
Source: Agencies |
October 31, 2012, Wednesday
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Print Edition
Print Edition
LAWMAKERS in indebted European Union member Hungary are waving the prospect of a passport at well-heeled foreign investors.
Proposed legislation listed on parliament's website would grant permanent residency and ultimately Hungarian citizenship to outsiders who buy at least 250,000 euros (US$322,600) worth of special government bonds.
Hungarian passport holders are entitled to live and work throughout the EU countries.
The move is designed to attract new investors, especially from China.
Hungary has billions of euros worth of foreign currency debt maturing in the next few years and has explored a variety of ways to refinance.
Its plans include selling euro-denominated bonds to domestic buyers and trying to attract major new investors from Asia. Selling debt in Western bond markets would happen only after tricky talks with international lenders wrap up.
Budapest has asked for a financing backstop from the EU and the International Monetary Fund, but talks are dragging on and analysts see only a 50 percent chance of a deal.
The proposed law calls for the debt management office to issue special "residency bonds" to foreigners. Holders of at least a quarter of a million euros' worth of the paper would get preferential immigration treatment.
"The goal of the modification is to create the institution of 'investor residency' in Hungary," the lawmakers who put forth the legislation said.
"The proposal ties gaining citizenship to buying bonds because it intends to aid state financing this way," they said. "Other investments from those applying for such residency could boost the real estate, retail and investment markets."
One of the authors of the proposal said Chinese investors were specifically targeted.
"The Chinese have articulated repeatedly that we should help their Hungarian investments," ruling party lawmaker Mihaly Babak told the daily Nepszabadsag. "If someone is a Hungarian citizen they have more (investment) opportunities."
Proposed legislation listed on parliament's website would grant permanent residency and ultimately Hungarian citizenship to outsiders who buy at least 250,000 euros (US$322,600) worth of special government bonds.
Hungarian passport holders are entitled to live and work throughout the EU countries.
The move is designed to attract new investors, especially from China.
Hungary has billions of euros worth of foreign currency debt maturing in the next few years and has explored a variety of ways to refinance.
Its plans include selling euro-denominated bonds to domestic buyers and trying to attract major new investors from Asia. Selling debt in Western bond markets would happen only after tricky talks with international lenders wrap up.
Budapest has asked for a financing backstop from the EU and the International Monetary Fund, but talks are dragging on and analysts see only a 50 percent chance of a deal.
The proposed law calls for the debt management office to issue special "residency bonds" to foreigners. Holders of at least a quarter of a million euros' worth of the paper would get preferential immigration treatment.
"The goal of the modification is to create the institution of 'investor residency' in Hungary," the lawmakers who put forth the legislation said.
"The proposal ties gaining citizenship to buying bonds because it intends to aid state financing this way," they said. "Other investments from those applying for such residency could boost the real estate, retail and investment markets."
One of the authors of the proposal said Chinese investors were specifically targeted.
"The Chinese have articulated repeatedly that we should help their Hungarian investments," ruling party lawmaker Mihaly Babak told the daily Nepszabadsag. "If someone is a Hungarian citizen they have more (investment) opportunities."
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