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10 Business Today maltatoday, WEDNESDAY, 20 AUGUST 2014 Malta's citizenship programme brings in over €200 million Prime Minister Joseph Muscat to address Henley & Partners' Global Citizenship Seminar in New York next month Miriam Dalli Applications for Maltese citizenship under the Individual Investor Pro- gramme number over 200, with some already at the Due Diligence stage. According to Henley & Partners, this represents a commitment of for- eign direct investment into Malta of over €200 million over the last six months. Earlier this month, MaltaToday revealed that the government had received over 200 IIP applications and most of them did not face any serious objection. The applicants are mostly Russian, but applications hail from over 30 countries. Henley & Partners confirmed that over 30 nationalities are represented among the applicants so far. Prime Minister Joseph Muscat will also be speaking about the IIP's success in New York. According to the concessionaires, Muscat will be addressing a Henley & Partners' Global Citizenship Seminar at the Four Seasons Hotel on September 10, in three weeks' time. "Their excellent services are attracting to Malta the type of individuals that the government wanted to target through the IIP, with the potential of significant investment in our country," Identity Malta chief executive officer, Jonathan Cardona, was quoted as saying by Henley & Partners. According to Cardona, many applicants started the IIP process intending to rent property on Malta, but are now considering purchasing, having spent time on the islands. Cardona confirmed that a number of applicants were opting to buy property. He added that the investment interest was quite wide- ranging, from hotels and real estate, to factories, IT and the film industry. "I liked the idea of becoming European and providing my children the right to travel without hassle, and to also live, work and study anywhere in Europe," a private client, who wished to remain anonymous, told the concessionaries. The IIP is a modern citizenship- by-investment programme aimed at ultra-high net worth individuals and families worldwide. It was designed and is operated by Henley & Partners for the Government of Malta under a Public Services Concession. The IIP allows for the grant of citizenship to duly qualified, reputable foreign individuals and families who make a significant contribution to the economic development of Malta. Investors who make a minimum contribution of €650,000 (plus €25,000 each for any spouse or minor child) will be granted Maltese citizenship, provided they meet due diligence criteria and pass a criminal background check. Apart from having had to purchase a property worth at least €350,000, or to rent a property for €16,000 a month, the third requirement – purchasing €150,000 in financial instruments – would mean a cumulative impact of €30 million in such investments. The new citizens' Maltese passport will give them full voting rights on the island and free access to the border-free Schengen area inside the EU. Muscat estimated a conservative €30 million would be generated in the first year of the IIP, the programme devised by the Labour government to create a posterity fund that would finance government capital spending in health, education, and social spending. Joseph Muscat with Henley's Christian Kalin (foreground) at a Henley & Partners conference in Malta. PHOTOGRAPHY BY RAY ATTARD Being RMB-ready gives competitive advantage in China Trade – global survey In the global race to develop trade links with China, readiness to do business in renminbi (RMB) could give some countries' exporters a vital edge over their rivals, a new HSBC Commercial Banking survey shows. While two-thirds of companies in mainland China and Hong Kong said foreign firms doing business with China gain financial and relationship advantages from using RMB, awareness of these potential benefits varies widely overseas, according to the 11-market poll. Half of respondents from Singapore, 44% from the US and 42% from the UK said they believe RMB usage brings financial benefits, yet less than a third of their German and Canadian peers share this view. More than half of UAE respondents said they see business relationship benefits from RMB adoption, compared with 46% in France and 40% in Australia. Overall, 59% of decision-makers surveyed said they plan to increase their cross-border activity with mainland China over the next 12 months, rising to 86% in the UK, 74% in Canada, 73% in the UAE and 63% in France. At the same time, only 22% said their company currently settles business in RMB. "This survey highlights a need for many companies to learn more about how the RMB can help them connect to opportunities in China and get ahead of their rivals in this highly competitive market," said Simon Cooper, Chief Executive of HSBC Commercial Banking. "Most Chinese businesses look favourably on overseas partners who are using RMB, both because it shows commitment and because it eliminates foreign exchange risk from their cost base. Although a currency can't guarantee commercial success in China, it's clear that RMB should be a core component of every company's business planning." "The findings confirm the growing importance of RMB as a world currency. As part of HSBC Group, HSBC Bank Malta, which is the only bank in Malta offering Direct Trade Settlement in RMB, is well positioned to assist its customers wanting to carry out transactions in RMB as well as facilitate trade through this currency, as part of our ongoing Malta Trade for Growth initiative," said Michel Cordina, Head of Commercial Banking at HSBC Malta. The Head of Global Banking and Markets for HSBC Malta James Woodeson said: "Aside from creating new trade avenues, the growing use of China's currency worldwide is also generating capital investment and financing opportunities for companies doing business internationally. The benefits for corporates using RMB include improving working capital, simplifying processes and mitigating payment risks." With its trade in goods passing US$4 trillion, China overtook the US to become the world's largest trading nation in 2013. The IMF's projections for nominal dollar GDP show that China will add about US$850 billion to global demand this year; the equivalent of adding an economy the size of Indonesia to global trade flows. As China becomes ever more important to international businesses, the internationalisation of the RMB is creating new opportunities in trade, investment, cash management and funding. HSBC forecasts that a third of China's trade will be settled in RMB by 2015 and that the currency will be fully convertible by 2017. For its new survey, HSBC polled more than 1,300 decision-makers from mainland China, Hong Kong, Singapore, Taiwan, Australia, Germany, France, Canada, the UK, the US and the UAE who represent companies that conduct international business with or from China. Among the other highlights of the survey: • Outside the Greater China region (mainland China, Hong Kong and Taiwan), businesses in France (26%) and Germany (23%) report the highest levels of RMB usage. • Of companies using the RMB to settle cross-border business today, 59% expect to use it more over the next 12 months. • 32% of companies that don't use the RMB already expect to do so in the future. • Reasons for using the RMB include requests from trading partners, reducing FX risk, convenience, winning new business and gaining better pricing. • Those surveyed believe that the simplification of procedures (68%), further liberalisation of the exchange rate (61%) and expansion of transaction types that are RMB eligible (57%) would encourage them to further use RMB. YOUR FIRST CLICK OF THE DAY www.maltatoday.com.mt

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