LEGISLATORS in indebted EU 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 e250 000 (R2.8 million) worth of special government bonds.

Hungarian passport holders are entitled to live and work throughout the EU.

The move, backed by the ruling government party, is designed to attract new investors, especially from China.

Hungary has billions of euro 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 wrapped up, the government said.

Budapest has asked for a financing backstop from the EU and the International Monetary Fund, while analysts see only a 50 percent chance of a deal.

The proposed legislation calls for the debt management office to issue special “residency bonds” to foreigners.

“The goal of the modification is to create the institution of ‘investor residency’ in Hungary,” the legislators who put forth the legislation wrote in their proposal.