The elimination of Canada’s long-standing Immigrant Investor Program (IIP)—and the fast track to citizenship it offered—means thousands of predominantly Asian wealthy investors may have to examine their immigration alternatives.
The cancellation of the IIP program means an estimated 46,000 wealthy Chinese investors in Canada will receive a refund of their immigration investment and as have their applications denied. And those wealthy investors are expected to seek out immigration investment alternatives in other Western countries.
Prior to its cancellation, applications for Canada’s IIP program had been frozen for almost two years, and during that time wealthy investors—primarily from China—had already begun to seek out other immigration alternatives. The official end of the IIP program is seen as a substantial change to Canada’s immigration policy, as the 46,000 wealthy IIP applicants represented about six times the number of total applicants for similar programs run by the United States, Britain and Australia.
The termination of Canada’s IIP program is expected to have the greatest impact in Vancouver, where about 80 percent of the country’s Chinese investor immigrants live. Since IIP began, tens of thousands of Chinese immigrants—many of them investor immigrants from Hong Kong—moved to Greater Vancouver. In fact, the City of Richmond, a Vancouver suburb, now has the largest Chinese population in the Western Hemisphere.
The IIP program has also had a significant impact on Vancouver’s real estate market. Demand for housing, in part as a result of the immigration program, has pushed Vancouver’s home prices to the highest in North America. With the cancellation of the immigrant investor program, real estate experts foresee a possible steep decline in demand for Vancouver housing, especially in the high-end market.
In announcing the end of the IIP program, the government cited several determining factors including:
- Undervaluing Canadian residency; while Canada required a “loan” of $800,000 from wealthy immigrants under the IIP, similar programs in Australia, New Zealand and the United Kingdom require between $5-$10 million and offer no promise of permanent residency
- An insufficient contribution to Canada by IIP individuals; the CIC says that over a 20-year period, an investor immigrant paid about $200,000 less in income taxes than a skilled federal employee and almost $100,000 less than a live-in caregiver
CIC believes the end of the IIP will benefit Canada by increasing the overall efficiency of the country’s immigration system. According to the government, there was a backlog of more than 60,000 IIP applications—larger than any other Canadian economic immigration program. It’s estimated that it would have taken more than six years to process just the existing IIP applications.
For their part, many Chinese investors in Canada—particularly in Vancouver’s Asian community—have expressed displeasure with both the government’s decision to end the IIP, as well as the way the decision was reached.
At a recent press conference in Vancouver, several wealthy Chinese investor immigrants complained that the government’s decision was unfair and “demeaning” to IIP investors. They also complained that the investor immigrant community was not consulted prior to the government’s decision to terminate the IIP program.
Still, Immigration Minister Chris Alexander says Canada continues to welcome Chinese investors. In recent interviews with Chinese media, Alexander said he didn’t want Chinese immigrant investors to feel “unwelcome,” and that there were several other alternative Canadian immigration investment programs they may wish to consider.