US Freedom Capital Blog

Chinese are snapping up EB-5. Are you missing a trick?

Posted by USFC Team on Apr 20, 2017 2:00:00 AM

America is the largest economy in the world. China’s is the second largest. When you have almost 75-85% quota of an immigrant investor program of the top country being captured by the second country, you need to ask yourself what you are missing. EB-5 is the fastest and usually the only route for unsponsored individuals and families to get a US green card and citizenship. The United States does not only provide a pretty high quality of life but is also among the most propitious countries to invest in.

In the fiscal year 2016, approximately 7,516 visas were issued to China, 334 to Vietnam, 260 to South Korea, 203 to China Taiwan, 150 to Brazil and only149 to India. There is a ceiling of 10,000 EB-5 visas in a fiscal year. It is discerning to note that Chinese nationals were issued 13% visas in 2004 and 90% in 2014.

It is also important to understand that there is a quota of 7% per country but any unused balance is released for all.

So technically, Chinese should be eligible for 700 visas but because of lack of knowledge, other countries (especially India) are missing out and Chinese are cashing in. You and your family represent the elite in your country if you are considering EB-5. You most probably know that Chinese are among the most astute investors in the world. Let us analyze why Chinese are going aggressively for the EB-5 route:

  1. America is a land of opportunities, with an extremely strong rule of law and business ethics.
  2. American universities and colleges represent the best in the world. Chinese (and Indians!) have always valued education. Not only do you get cheaper tuition fees, your progeny has a better chance at Harvard or Yale if he is from America as compared to from China.
  3. China is besotted with pollution and lifestyle problems. The older generation has grown up in this environment and they are used to it. The younger generation has grown in a cosmopolitan connected world and knows what they are missing out in terms of quality of life.
  4. EB-5 acts as a political insurance in a world pivoting on a daily Politicians are clamping down on even genuine businesses and bureaucrats just to satisfy public demand for some kind of misguided retribution towards the rich and the powerful.
  5. Also, other avenues of immigration Student visa and H-1B are/will be under attack by Trump administration.
  6. Most importantly, other developed countries like Canada, New Zealand offer similar visas for over a million dollars and American authorities have woken up to the fact. New norms are looking to increase the investment to $1.35 million. Chinese are smart and getting in front of the line before such restrictions hit.

Now as an Indian, don’t you think all the above factors apply to you as well?

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There were 111 visas issued to Indians in 2015 and 149 in 2016.

 Though it is tremendous growth in percentage terms, India is still minuscule as compared to China. The few reasons as to why EB-5 is still at a nascent stage in India are as follows:

  • India lacks a sophisticated network of consultants that have a deep understanding of EB-5 and this one of the main reasons why not many people in India have heard about this program. US Freedom Capital is remedying this; not only have we opened an office in India, we are also tying up with top consultants and making them aware of the immense benefits of the EB-5 program.
  • Indian families were comfortable to wait for decades for immigration under H-1B. That might have been a safe bet during the previous regimes, but it is a pure gamble under Trump.
  • Indian investors were heavy investors in real estate during the previous decade. But with realization dawning that super-sized returns in property are a thing of the past, returns provided by stable financial instruments like healthcare assets under EB-5 investment program looks like a smart risk.

It is essential for us to understand the changing political landscape coupled with the financial advantage of investing promptly under the existing regulations. Chinese have been diversifying their financial and political risk by investing under EB-5. Not only are they able to get hands on US-dollar denominated secure long-term cash flow generating assets but also Green cards for their entire family.

US Freedom Capital has identified the gap and taken the mantle to educate the Indian audience. It has done substantial initial legwork and road shows to promote the scheme among various stakeholders associated with the decision and consultation process. It is one of the leading players with a team and advisor list comprising of a former Director, former Acting Director and former highest career ranking officer in USCIS (United States Citizenship and Immigration Service- the government agency which runs this program). So this team not only understands EB-5, it is the one which has created the framework on which the program stands today. The company has also world-class investment professionals with a deal experience in real estate and banking of over 3 billion dollars (INR 20,000 Crores).

It is essential and easy in today’s digital-first world to evaluate all your options. Indians and Chinese have been competitors for the last many decades in all arenas and it is vital for you to examine why there is such a heavy backlog of Chinese looking to invest and immigrate to the United States through EB-5. This investor program is a unique opportunity and it is a matter of time before Indians get on the bandwagon. The question is who will be at the front of the line!!
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Topics: EB-5, India

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