HONG KONG - The huge demand from wealthy Chinese citizens for U.S. investor visas has resulted in a shortage and a two-to-three year waiting list for many of those applying.
The supply of, and demand for, U.S. investor visas track how China’s newly wealthy are eagerly pursuing U.S. visas.
Congress created the so-called EB-5 visa program in 1990 as a way to give foreign entrepreneurs the opportunity to live and work in the United States by investing in American businesses. The program allows wealthy investors to bypass the sometimes years-long wait that is normally required for gaining a visa through an American relative or employer.
Gaining a visa broadly requires foreigners to invest in a business that either creates or saves 10 jobs in the United States. The entrepreneurs must invest at least $1 million, or $500,000 if the business is located in certain rural areas or places of high unemployment. By doing so, the investor can gain a “green card,” which is a document granting permanent residence.
Over the program’s first 24 years, the number of visas granted never reached its annual limit of 10,000. That all changed in 2014, with a surge of applications from Chinese citizens. That year they accounted for about 85 percent of all visas granted.
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Bernard Wolfsdorf is founder of the Wolfsdorf Immigration Law Group in Los Angeles. “I don’t think any country has experienced the sort of meteoric rise in income that the Chinese have. So very few people can invest a half million dollars for a green card without blinking like the Chinese folks can,” said Wolfsdorf.
The flood of applications from mainland Chinese continued in 2015. That led U.S. officials to declare that starting this month, for Chinese investors, the program is only considering applications from investors who had applied by May 1, 2013. Applicants from other nations or from Hong Kong, Taiwan, or Macau, are not affected.
The rise in applications has been attributed to worsening pollution, China’s tightening political climate, or better education opportunities at American universities.
Jean Francois Harvey, an immigration lawyer in Hong Kong, said many are also lured by the old fashioned American dream.
“What we find fascinating here as a firm is to see how strong this American dream concept still is internationally. We do meet clients, their kids are already in the U.S., at Ivy League schools, but they want to be part of this U.S. dream,” said Harvey.
For American cities, wealthy Chinese offer a new source of local investment and job creation. Billions of dollars in new investment are credited to the program, which supporters of the program say make it an important tool for boosting the economy – especially in rural or low-income areas. Several large real-estate development projects have included funds from EB-5 investors. Critics say that the program is merely selling visas to the wealthy, without a larger economic impact.
Nevertheless, Audrey Singer of the Brookings Institution said American cities are in fierce competition to lure rich Chinese immigrants. The EB-5 visa program has led to the creation of new regional centers, which help pool investors’ money into larger development projects that meet the requirements for an EB-5 visa. The centers are managed by outside companies and assume the responsibility for creating the jobs required to qualify for the visa.
“One of the most interesting things for us is the proliferation of the regional centers, those are the entities that bundle the EB 5 investment money. When I started working on that project that resulted in the Brookings paper, there were a little over 200 regional centers. Just five years before, there were about a dozen. And now there are over 600,” said Singer.
Now there is a two-to-three year waiting list for Chinese attempting to emigrate to the United States through the EB-5 program and 13,000 total pending applications from all countries for the visa program.