Time To Restart The Canada Immigrant Investor Program
By Pace Law | September 2, 2016
Hon. Gerry Weiner – Pace Law Firm: It was announced during the Prime Minister’s current visit to China that Canada will open seven new visa offices in that country in order to bring more Chinese citizens to Canada, whether as visitors or workers. It has also been revealed that Prime Minister Trudeau is interested in joining an Asian infrastructure bank:
Canada is keen to get involved with a new international infrastructure bank in China, Prime Minister Justin Trudeau indicated Tuesday — a move that would help the east Asian country’s economic credibility around the world.
China founded the Asian Infrastructure Investment Bank late last year to provide other countries in the region access to capital for investments in things such as transportation, power and telecommunications projects.
The bank has already invested more than US$500 million in Bangladesh, Indonesia, Pakistan and Tajikistan, and Chinese officials have said it plans to loan out US$10-15 billion over the next five years.
“My government believes very, very much in the importance of investing in infrastructure,” Trudeau said Tuesday during a roundtable discussion with business leaders.
Obviously the Canadian government is positioning itself to be a big partner with China in terms of immigration and investment. However, if the PM is interested in investing in infrastructure, we must hope that this includes infrastructure here in Canada and not just overseas.
It is time for Canada’s federal immigrant investor program to be restarted, with a new focus on creating jobs in economically challenged areas of Canada.
Two current investor programs that can serve as a guide to success are:
The Quebec Immigrant Investor Program
In this program, immigrant investors are offered residency in Canada and are required to place $800,000, in trust, for a five year period, after which funds are returned without interest. Investors must establish that they have a minimum net worth of $1.6 million dollars, and they must prove the legitimacy of the funds. The vast majority of immigrant investors come from China, elsewhere in Asia, and the Middle East.
Since its inception in 1986, the Quebec immigrant investor program has generated over $4 billion in deposits and pumped hundreds of millions of dollars into the Quebec economy. Quebec’s substantial application fee ensures that the program is wholly self-funded. The year 2015 was its best yet, with some 5,000 investors approved.
The Quebec program is a good model for how government can do its due deligence while making a program achieve maximum returns.
The US EB-5 Program
The template for a Canadian program could also be modeled after two U.S. streams found in the EB-5 program. Both streams can lead to permanent residency (green cards) for the investor.
The first stream involves U.S. regional centers. These bring together foreign investors and local entrepreneurs. The investor takes a passive role in an enterprise, while economic development officials ensure the best use of funds.
The second stream under EB-5 is through direct investment. In this case, the investor is in day-to-day control of an enterprise and is responsible for creating a minimum of ten jobs for US workers.
Canada Immigrant Investor Program
A hybrid of the above programs would help generate a lot of money and jobs for Canada. Such a program should require investments of five hundred thousand to a million dollars from an investor, with the lower amount geared toward areas of higher unemployment. This money would be directed toward private sector enterprises, with job creation as an essential component. Importantly, the money should be at risk. That is, if the business does not succeed, the investor stands to lose the money.
Creation of Canadian regional centres would enable the private sector, in a given area, to participate constructively in the allocation of a foreign applicant’s investment. As with the EB-5 regional centers, an economic development official could provide oversight for resource allocation and job creation.
Immigrant and refugees categories can also be added to a regional centre’s services, assisting both social and economic integration of newcomers into a variety of locations outside of major Canadian cities.
The Time Is Now
Receiving 10,000 families annually through such a program would generate $5 billion for economic priorities and create a minimum of 100,000 jobs. Just think what that could mean to economically challenged areas of Canada.
Immigration Minister McCallum and the government have been on roll since last year’s election. They’ve helped 25,000 families from Syria secure a brighter future and they’ve already made great strides in making China a closer partner for future immigration and economic plans. Now is the time to act for Canadian development, before we lose highly desirable investor immigrants to the United States, European Union, Australia and other countries competing for investors that seek new homes and economies in which to invest.