Salient to Investors:
- Chinese millionaires who invest at least $4.7 million and qualify for Australian residency can get around China’s restrictions on converting currency and sending it abroad. China caps the amount of yuan that individuals can convert into other currencies every year at the equivalent of $50,000 and bars transferring currency abroad directly. China’s goal of free convertibility of the yuan is a step toward making Shanghai a global financial capital by 2020.
- Baker & McKenzie estimate the flow of money into Australia could rise to as much A$10 billion a year. More than 1,000 people, almost all from China, have applied. Canada canceled a similar program in February with more than 65,000 pending applications because it felt immigrant investors pay less in taxes than other economic immigrants, are less likely to stay in Canada over the medium-to-long term and often lack the skill and language proficiency to integrate with other immigrants.
- Australia’s Significant Investor 188 Visas are similar to US EB-5 visas and carry a $500,000 investment minimum and the requirement to create jobs.( ‘8’ in Chinese sounds like the word for making a fortune and is considered lucky.)
- Immigrants are required to invest the A$5 million into government bonds or complying funds that invest in assets such as infrastructure, real estate and agribusiness, for 4 years.
- Bain & Co estimated in 2013 that 60 percent of high-net-worth Chinese – those with at least $1.6 million – have left China or are considering it.
- Bill Fuggle at Baker & McKenzie said the Chinese rich want to hedge their bets and their closest option is Australia, which has a special and very long relationship with China. Fuggle said the purchase of a home in Australia does not qualify, though visa applicants typically buy them as well, and said the Canadian program termination has increased interest in the Australian one.
- Chinese investment in Australian property climbed 42 percent to A$5.9 billion in the year to June 2013, surpassing Americans as the biggest group of buyers, the Foreign Investment Review Board said in its latest annual report.
- Catherine Chow at Deloitte said their Chinese clients seek agribusiness focused on high protein, meat products and soy, and clean energy, largely solar and wind.
- Australia’s A$1.7 trillion pension sector is the fourth-largest in the world.
Read the full article at http://www.bloomberg.com/news/2014-07-21/millionaire-hunters-lure-rich-chinese-to-australia.html
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