36 TheEconomistJuly 20th 2019
1T
ang shougangis one of a generation
of young Chinese who seem to have it
all. Aged just 35, Mr Tang (not his real
name) has a well-paid job for a tech firm,
and his wife owns a successful shop. They
have two young sons, two cars and an
apartment in downtown Shanghai worth a
fortune. One perk enjoyed by others of
their class, however, eludes them: a pass-
port or long-term residents’ visa for a coun-
try other than China. Ideally they would
like a green card that makes it easier to live,
work and educate their children in Ameri-
ca. That looks difficult, so the Tangs are
pondering other options.
A whole industry has grown in China to
help them choose. About a hundred coun-
tries around the world have schemes that
offer residence—a “golden visa”—in return
for a big investment from the applicant. A
dozen or so of these go further, and also of-
fer a passport, in effect selling citizenship.
By far the biggest users of these “residence
or citizenship by investment” (rcbi)
schemes are Chinese. Hundreds of busi-
nesses compete to help them navigate the
labyrinthine procedures. They usually of-fer other services as well, such as help with
applications for student visas.
There are various reasons why Chinese
citizens want residence abroad. By far the
most common—the Tangs in this respect
are typical—is education. Parents want to
spare their offspring the horrors of China’s
gruelling university-entrance exam, the
gaokao. And they believe that a foreign
education will open up opportunities un-
available at home. Even childless Chinese
also see the attractions of a “plan b” should
the political or economic climate in China
deteriorate. Many like the idea of investing
abroad, especially in property, to diversify
their portfolios as much as to acquire a
bolthole. And some may actually prefer to
live, or at least retire, overseas.
These, however, are difficult days for
China’s rcbiindustry, for a number of rea-
sons. One, in the words of Larry Wang ofWell Trend, one of the biggest and longest-
established visa consultancies, is that it
has become “the victim of its own success”.
The sheer number of Chinese applicants
has overwhelmed some of the rcbi
schemes. By far the most sought-after is
America’s eb-5 programme, launched in- Mr Wang says it is top of the list for
eight out of every ten of his clients—Ameri-
ca’s universities being the biggest pull.
eb-5 visas require investment of at least
$1m, or half that if it goes into a “targeted”
area of high unemployment. About 10,000
eb-5 visas are issued every year. A maxi-
mum of 7% can go to any single national-
ity—ie, just 700 Chinese, and the waiting-
list for their compatriots is now 15 years
long. A bill before Congress would abolish
country caps. But so popular is the scheme
worldwide that analysts reckon this would
cut the waiting time for Chinese applicants
by only three to five years. A group of more
than 450 Chinese eb-5 investors is suing
the American government, arguing that it
is wrong to interpret the 10,000 annual
limit as covering visas, rather than inves-
tors, whose dependents should then also
be granted residency.
For educational migrants, the obvious
alternative to America would be another
English-speaking country. But Canada
closed its federal programme in 2014 (some
provincial schemes, such as Quebec’s, con-
tinue). And in other countries the required
investment is much bigger—A$5m in Aus-
tralia ($3.5m); £2m in Britain ($2.5m) and
NZ$3m ($2m) in New Zealand. So there is
Investment migrantsGolden parachutes
BEIJING AND SHANGHAI
Well-off Chinese are the world’s best customers for schemes selling “golden”
visas and passportsChina
37 SafetyindragAlso in this section— Chaguan is away