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U.S., Canada favored by China's third wave of emigrants

2012-02-02 11:10 Ecns.cn     Web Editor: Wang Fan comment
(Picture: CFP)

(Picture: CFP)

(Ecns.cn) – The number of Chinese investing overseas in order to emigrate has been soaring in recent months – about 60 percent of China's millionaires are considering leaving, or have already taken steps to do so, according to a survey jointly released by the Hurun Research Institute and Bank of China.

Experts say a third wave of emigration has been taking shape in China, and its principal members are wealthy people, each of whom holds net assets of at least 60 million yuan (US$9.5 million). The U.S. and Canada are their most popular choices, according to Economic Information Daily.

Third wave of emigration

Since reform and opening up began in the 1970s, China has experienced three waves of emigration.

People first moved to the West mainly in search of their family members, and the majority of these migrant workers later obtained permanent residence and settled abroad. Experts say many of these workers actually stowed away on ships to get into Western countries, and many died en route.

In the 1980s, waves of Chinese began heading for non-Western countries, including India and Tanzania. They went abroad mainly as overseas students or skilled labor and wound up settling permanently.

After 2002 – especially following the global financial crisis in 2008 – the third wave of emigration gradually began, formed by Chinese multi-millionaires eager to invest abroad and leave China in search of better education, cleaner air and greater social stability.

Compared to the first two waves, this group has some new characteristics: the key difference is reflected in the wealth of the group, but the rapid growth of their numbers and their strong willingness to emigrate also makes them unique. Many of them are even celebrities and successful businessmen in China, experts say.

Usually, residents of an impoverished country rarely emigrate, unless they become refugees, while citizens of a wealthy country will see no need to leave in the first place. Residents of a developing country, however, are the most likely to consider migrating.

U.S. and Canada the top spots

Moving overseas is now at the top of the wish list for China's wealthy. According to the survey of 980 Chinese mainland residents with assets of more than 10 million yuan (US$1.6 million) published by the Hurun Report and Bank of China, the U.S. and Canada are the most desirable destinations, followed by Singapore, Hong Kong and the U.K.

According to another report released by Bank of China, high-yield opportunities are not the primary purpose of Chinese investment in the U.S. Instead, one-third invest mainly for immigration purposes, while half choose to focus on property investment, followed by foreign currency deposits, stock shares, financial derivatives, running businesses and insurance.

A report released by Knight Frank, a leading independent global property consultancy, pointed out that overseas properties are undoubtedly the favored investments for Chinese people, though relatively speaking their value may not increase as much.

China's rich consider many factors when choosing destinations to invest in, including the minimum investment requirement, the living environment, the time involved in the application process, immigration control, and the proof required for sources of revenue, said Wu Botao, a manager at China Citic Bank.

Last year, compared to other nations, Chinese multi-millionaires benefitted most from the EB-5 Immigrant Investor Program in the U.S. Now, as long as one has at least US$500,000 to invest in projects listed by United States Citizenship and Immigration Services (USCIS), it is possible to get an EB-5 green card that comes with permanent U.S. residency rights, but only in states specified by the pilot project.

The Hurun Wealth Report 2011 confirms that China had 960,000 individuals with personal wealth in excess of 10 million yuan ($1.56 million) in 2010, a 9.7 percent increase over the previous year. In the past three years, about 17 billion yuan ($2.63 billion) of capital has gone overseas.

 

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