COLUMN ONE : Passports Hot Item in Hong Kong : Citizens seek an escape hatch when the British colony reverts to Chinese control. Pacific countries are cashing in by selling citizenship.


For Hong Kong residents desperate to flee before China takes over in 1997, the Federal Republic of Corterra sounded perfect.

The tiny Pacific island nation was described as lying between Tahiti and Hawaii, with 80,000 citizens who enjoy democratic government, a British-style legal system and no income tax. Best of all, a newspaper ad here boasted, passports are bargain-priced at only $16,000.

Three local businessmen quickly paid the $5,000 application fee. Then they discovered the catch.

"To the best of our knowledge, Corterra does not exist," said Ben W. Munford, detective chief superintendent. "No such country. No such place."

But plenty of real Pacific countries, from Tonga to Tahiti, from Saipan to Fiji, are cashing in on the growing uncertainty about Hong Kong's future by selling citizenship, usually for fees or investments of less than $75,000.

More than a dozen other places are also peddling low-price passports, from the Turks and Caicos Islands in the Caribbean to the Republic of Transkei in southern Africa, and from Malta in the Mediterranean to Mauritius in the Indian Ocean.

This is the seedy side of the brain drain, the much-publicized departure of tens of thousands of Hong Kong tycoons, entrepreneurs and professionals for the United States, Australia and Canada. People who are too poor, too poorly educated or without the family ties needed to qualify for the country of their choice often settle for any place that will accept them.

"Everyone I know is leaving," said Robert C. Broadfoot, managing director of Political & Economic Risk Consultancy, a business consulting group. "They tend to go wherever they can get in."

Big or small, the attraction is the same. Many want an escape hatch when this British colony and Asian financial center reverts to Chinese control in 1997.

On Wednesday, the last day to register for naturalization in time to leave Hong Kong as British citizens, thousands of residents jammed the Immigration Department offices.

But even for those willing to stay after 1997, a passport--any passport--offers insurance in case Beijing's Communist leaders crack down on civil rights, capitalism and the freebooter lifestyle here.

"People are very nervous," said Serge Pun, a developer who has moved his family and most of his business to Thailand. "There's no solution that can really put people's minds at ease."

That's fine with Singapore, which has long been a regional rival. Singapore has approved passports for nearly 22,000 Hong Kong residents in the past year. To qualify, applicants must be either professionals or skilled technicians, computer programmers and the like. More than 200,000 have applied.

"The scheme is mutually beneficial," said Chi Choo, a Singapore Commission official here. "They are given five years to decide. They can stay and work for Hong Kong prosperity."

Other countries aren't so strict.

Take Tonga. Last fall, King Taufaahau Topou IV agreed to sell 1,000 passports from his tiny Polynesian country. So-called emigration consultants, lawyers and travel agencies openly competed to sell the Tongan passports, with prices ranging from $16,500 to $45,000.

The problem was that the special passport didn't get you very far. A Chinese man who bought one reportedly tried to commit suicide in Tonga in February after learning that he couldn't return to Hong Kong or even visit Australia.

One man authorized to sell the passports in Hong Kong skipped town leaving heavy debts behind, the police said, apparently to return to his original business in Australia: selling used cars.

Tonga's honorary consul here, Hung Siu-kai, says those problems are over.

Under a new scheme, applicants must lease land in Tonga for 20 years. It costs $17,500 for an individual or $25,000 for a family, including handling fees, and the passports are issued in four to five weeks, Hung said.

"We've had more than 500 applications," he said.

Apparently no one has applied to the Republic of the Marshall Islands, a country of far-flung atolls known for World War II battles and scores of U.S. atom bomb tests. The legislature last year approved the sale of 3,000 passports for $250,000 each. But the law says the new citizens may not "own land or possess any customary or traditional rights," such as voting.

No such problems taint Tahiti. The crown jewel of French Polynesia was front-page news in Hong Kong when a 17-man government delegation arrived to promote Papeete, its capital, and to dangle French passports in exchange for investments of at least $60,000.

New Caledonia and Fiji invite investors with $77,000. So does the Philippines, where developers are building a "Hong Kong Village" of posh homes in a Manila suburb to attract wealthy businessmen. More than 500 immigrant visas have already been issued, Philippine officials said.

Even tiny Tuvalu, a southwest Pacific nation of nine islands, none rising more than 15 feet above sea level, is besieged.

"I get inquiries every day from people who are interested in getting a Tuvalu passport," said Puran Sundarjee, honorary consul of one of the world's smallest and most remote countries. "Most have never heard of Tuvalu. I have to tell them we are 90% coral and the rest is ocean."

Farther afield, the tiny British Crown Colony of the Turks and Caicos Islands, eight inhabited islands east of the Bahamas, has advertised itself here as "a tropical paradise on the same latitude as Hong Kong," offering "wide-open opportunities to immigrate and/or invest." Minimum capital for a passport: $100,000.

Real estate agents push properties in Portugal and Ireland, where residence can lead to citizenship. Representatives of Peru, Argentina, Brazil, Venezuela and Uruguay offer passports for a price. So did Panama, Belize and Paraguay until recent changes in their governments.

"There are still lots of inquiries," said a Paraguayan representative, Kong Chen.

Then there's Transkei. A recent ad in the South China Morning Post offered Hong Kong investors and their families "immediate citizenship" in "tranquil Transkei," and an "opportunity to start a new life in one of the world's friendliest communities."

The ad doesn't say that Transkei is one of South Africa's 10 tribal homelands and is ruled by a military government. Pretoria's white rulers consider Transkei an independent state, but almost no other government recognizes it as such.

"Of course, the stigma is that the Transkei passport is the same as South Africa's," conceded representative Robert Trott, an Australian. "No travel benefits. You can go to Taiwan and Hong Kong. That's about it, really."

The duty-free port and export processing zone promised in the ad does not exist yet, Trott said. But he added that about 60 people have called about the year-old ad campaign, and "two or three have actually gone."

Still, it's legal--more than one can say about some of the activity in selling citizenship. Panama's new government has accused its former Hong Kong consul-general of illegally selling passports. And a Venezuelan diplomat was arrested here recently after more than 1,000 Hong Kong Chinese had entered Venezuela in an $11-million immigration scam.

At least they got somewhere. The police have investigated 19 emigration scams in as many months in which jittery Hong Kong residents were parted from their money and went nowhere.

One man took in $700,000 in fees for schools in Canada, Australia and New Zealand. Students were promised visas. They were swindled.

"A lot of people were nervous and easy prey" after Chinese troops shot dissident students in Beijing in June of 1989, said Munford, the police superintendent. "I think confidence men and tricksters the world over sensed that and took advantage of gullible people."

Munford's men cracked the Federal Republic of Corterra caper last December after they spotted an ad in a Chinese-language newspaper. Their suspicions grew when the so-called Corterra consul confided that the Pacific paradise had another name.

"He claimed it was also recognized as the United Kingdom of Coral Land," Munford said with a laugh.

No arrests were made. The three victims were too embarrassed to complain.

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