China's Millionaires Are Leaving China
WHY YOU SHOULD CARE
The sale of entry visas has attracted a lot of wealthy Chinese to rich, developed nations, though one country has pulled the plug on its program.
By Ben Halder
The jury may be out permanently on the old question of if money can buy happiness, but that hasn’t stopped wealthy Chinese families from trying. There is a growing trend among China’s richest to use their wealth to move themselves and their families abroad. This is done primarily in the form of investment visas.
On the flip side, a number of countries are opening the doors to the estimated 1 million Chinese millionaires … provided they bring their money with them. It’s something of a bidding war in reverse, for which Australia wins the prize:
All it takes is
of investment to apply for permanent residency.
Other countries are not nearly so greedy, although the different terms on offer make the price of a visa difficult to compare.
The U.S., for example, will take just $1 million for a green card, offering residence. That’s for an investment that generates 10 jobs for at least two years, although under the so-called EB-5 program, investment in a public development project can be a less-risky substitute. This figure halves if the investment is in a rural area or in an industry suffering from high employment.
Terms from other countries vary:
- Investing 1 million pounds ($1.5 million) in the U.K. will buy up to five years of residency.
- Purchasing 500,000 euros ($569,000) worth of Spanish property grants foreigners residency for as long as the property is retained.
None of these visas are restricted to Chinese nationals. However, China’s the place to find nouveau riche these days, and since being introduced, the programs have all been dominated by potential investors from the Middle Kingdom who want out. Chinese citizens made up eight of 10 investor visas issued by the U.S. State Department last year. George Osborne, the British chancellor of the exchequer, declared that the U.K. would focus on making it easier for Chinese investors to enter the country.
Canada is going in the opposite direction. It canceled its investment visa earlier this year after the process became overrun by Chinese applicants. It was one of the cheapest routes out of China. The Canadian government said the program significantly undervalued Canadian permanent residency. It also provoked local resentment, as wealthy immigrants bid up property prices in places like Vancouver.
Chinese parents are concerned about raising kids in an environment with filthy air and a critical lack of clean water.
What’s in it for Chinese? Foreign markets rebounding from recession can sometimes provide profitable opportunities. They boast an investment environment free from corruption, patronage and government control, at least relative to China.
But realistically, economic opportunities do not top the list for many émigrés. China’s not an easy place to live. Wealthy Chinese parents are becoming increasingly concerned about raising kids in an environment with filthy air, not to mention a critical lack of clean water and constant food and beverage safety scandals.
Calculating prospective parents can also use the visas as a means to obtain foreign nationality for their children, if they’re born abroad. Later, if those children return to China with a foreign passport, they’ll be able to attend international schools, which are off-limits to Chinese nationals. It’s also easier for them to travel and attend university abroad. Unscrupulous businessmen may be looking to escape China with their wealth intact before the government’s current anti-corruption campaign catches up with them.
It all sounds a bit mercantile. But if it’s not happiness they’re buying, sounds like they’re still getting a lot for their money.
- Ben Halder, OZY Author Contact Ben Halder