The Canadian Immigration Investment Program is CLOSED; U.S. Open for Business

There will soon be a boom in the U.S. immigrant investment program as the Ottawa government made a surprise announcement to close their immigrant investment program.

My take on this was published in China US Focus, or you can read about it below:

Canada Closes Its Doors for Immigrant Investors: A Boon For America?

In a move that took almost everyone by surprise, last Wednesday, the Ottawa government declared that it would be closing its immigrant investment program for good. This comes after almost two years of a complete standstill in the program, with no visas being issued to any applicants since before 2012. That gridlock led to a backlog of over 65,000 immigrant investor applications, some dating back to as early as 2008.

Since the program was halted in 2012, Ottawa had maintained that the program would be opened again sometime in 2014. However, it appears that the pressure to close the program proved to be too great. Unfortunately, for those that have been waiting in line, in some cases for perhaps four years or more, there will be no Canadian Permanent Residency waiting at the end of this road.

It is no surprise that the biggest demographic impacted by this bombshell decision is Chinese investors. According to official numbers from the Canadian government, around 45,000 applicants waiting in line were from Mainland China.

One Door Closes, Another Opens 

As we speak, Chinese applicants and the hundreds of immigration agencies all over the country are going over options. In an industry that is far from transparent, Chinese investors that were counting on the program to be reopened are now wondering what direction to go in. Whether they were interested in living in Canada, starting a business, or in most cases, sending their child to school, their plans that had been many years in the making will have to be altered.

Just south of Canada, though, there is another country with its own investor immigration program that looks like the most natural choice for recently rejected would-be Canadian immigrants. The U.S. EB5 program boasts all of the benefits of the Canadian program, and over the next few months we may witness one of the biggest moments in the program’s history. 

Canadian Program Basics 

The Canadian and U.S. program differed in a variety of ways, both having merits and shortcomings in comparison to one another. From the mid-90s up until mid-2011, Canada dominated the market. The program had been a $400,000 loan to the federal government, which was returned to the investor without interest five years after making the investment. In 2011, the program was raised to a minimum $800,000 investment in an attempt to slow things down; applications still poured in which led to the 2012 halt and today’s outright cancellation.

One of the biggest advantages in the market was that the Canadian program was a no-risk loan to the government, unlike the U.S.’s $500,000 at-risk investment scheme. In a country where trust is scarce, many Chinese flocked to the Canadian program simply because they knew that as long as they could wait in line, the government would guarantee their green card and their money. 

The U.S. EB5 Program: A Life Preserver for Clients Rejected by Canada

Since the stall of the Canadian program in 2012, the U.S. EB5 program has started to pick up more and more steam in the Chinese market. In 2011, 2530 EB5 visas were issued to Chinese clients, just shy of 80% of the worldwide market. In 2013, that number was already up to 6895 visas, taking up 81% of the market. That number will likely rise this year in response to the drastic change in Canada.

Agents across China that had previously made their bread and butter from processing clients into the Canadian program had started to shift their business models towards including U.S. programs on their docket, and now that trend will almost certainly go forward at a harder pace.

In many ways, the U.S. program is an easier and more attractive option for Chinese clients. Although the investment is required to be “at-risk,” it is cheaper in price: $500,000 into a venture that creates 10 jobs, as opposed to the Canadian scheme of investing $800,000 to the government. Plus, the wait times are much more reasonable. The U.S. program is averaging between 15 and 21 months, whereas at best, clients looking to the Canadian market could have expected at least a two to three year wait, if not more.

What to watch for in the EB5 program? 

Many clients will be considering the U.S. program in depth for the first time. One of the most frequent questions I have received in the last few days is “Could the same thing happen in the United States as in Canada?” While there is no guarantee, it seems extremely unlikely that the U.S. EB5 program would suffer the same fate as the Canadian program. The investments, for starters, are very different functionally. As a condition of the visa, the U.S. $500,000 investment must create at least 10 jobs, which is a direct link to actual economic development. The Canadian counterpart was only indirectly tied to economic growth and job creation.

The EB5 program, most recently renewed in 2012, was actually one of the few things Congress has agreed to at all in the last few years. It was passed unanimously in the Senate and breezed through the House with only 3 dissenting votes. I doubt in an election year, any politician will risk his or her political future on taking a crack at eliminating EB5.

Indeed, what may be more important for clients now considering focusing their aim on the United States is choosing a good American partner for the investment. The Regional Center that our company operates in, the Metropolitan Milwaukee Association of Commerce Regional Center was approved in 2007. At the time, it was the 21st regional center in America. Today, there are over 400! Competition is fierce, and most in the business are newcomers. Now is the time for clients and their agents to analyze projects closely and go with the companies that are committed to building quality, long-term, safe projects.

I believe that for whatever reasons the Canadian government decided to close its program, this is a huge opportunity for America. Communities around the U.S. that are most friendly and welcoming to our Chinese friends and other international friends, and have ready U.S. projects to boot, and will gain the most.

Dan Redford is the Director of China Operations for FirstPathway Partners, and industry leading EB5 immigration fund manager. He also serves as the President of the Michigan State University Beijing Alumni Club. You can follow him and his perspectives from China athttp://www.danredford.com.

Chinese New Year – The World’s Largest Annual Human Migration

We just celebrated Chinese New Year here on this side of the pond. In this China US Focus piece, I give my perspective on what has literally become the world’s largest annual human migration.

You can read the post on China US Focus, or simply scroll down for the text in this blog. Happy New Year!

 

Chinese New Year: The World’s Largest Annual Human Migration

By Dan Redford

As Published in China US Focus

Every year in China about this time, the ground starts to shake. Don’t be too alarmed; I’m not talking about an earthquake. I’m talking about China’s most important holiday, “Chinese New Year,” otherwise known as “Chunyun” or “Spring Festival.” Since living in China and experiencing the Spring Festival first hand, I’ve come to prefer another, more descriptive term for this holiday season: the world’s largest annual human migration.

In China, it is estimated that for this year’s Spring Festival, there will be over 3.6 billion “journeys” by Chinese people trying to make it home by plane, train, bus, or anything in between. For comparison, in the U.S. a mere 93.3 million people travelled domestically during the 2012 holiday season.

Unlike in the West where the year-end holiday season marks a mild slowdown in business and about 10 days off of work, the Chinese Spring Festival puts that to shame. Those 3.6 billion journeys will happen over a period of 40 days, this year lasting from January 16th to February 24th. For foreigners that are accustomed to doing business in China, this can be one of the most frustrating and confusing times of the year. If one is used to returning to their home country for the traditional Western holiday season, it is often just as practical to stay put and “wait out” the Spring Festival time.

Even though the New Year’s holidays do not officially begin until January 31st, there is a strong feeling of lethargy that begins in mid-January, creeping up gradually to the official holiday in which all business stops. While it is advisable to avoid trying to do business in China during this time, it is an amazing, albeit hectic, time to witness the complicated mix of wonderment and chaos that is modern China. The reason that the roads and trains are so crowded with people is that millions upon millions of people across China’s biggest cities are considered waidiren, or “out-of-towners.” According to the China Labour Bulletin, around 260 million Chinese farmers have moved from their hometowns for work in the cities.

These millions of people flock to metropolises like Beijing, Shanghai, or Shenzhen to find higher paying jobs than they could get at home. They spend most of their days in the city working long hours for salaries that net less than $500 a month on average. Half or more of that salary will be sent back to their families in their hometown. For most, the Spring Festival time is a nice respite from a long year of work, and a time to be reunited with family.

Needless to say, this holiday exacerbates China’s ongoing transportation nightmares. China has invested billions of dollars over the last decade into building the world’s largest network of fast-speed trains, collectively crisscrossing China’s terrain with over 12,000km (roughly 7,450 miles) of High-Speed Rail (HSR). It has been an impressive achievement, and yet, according to Want China Times, the rail lines can only accommodate 220 million people, a mere 10% of Spring Festival travelers. China’s massive population continues to force the country to keep moving and continue building to accommodate higher demands for people to more conveniently transport between the big cities and the rest of China. It is for this reason that China is aiming to have 19,000 kilometers of operational HSR by 2015, averaging construction of 10,000 km of new rails lines annually over the next few years.

For those of us living here, all we can really do is witness and experience the migration of millions of people at a time. Now, more than ever, it will need to innovate at a higher pace to keep up with a changing population with new concerns and higher expectations.

Still, as we consider the meaning of Spring Festival for Chinese people, it ultimately is a time for family and tradition. The billions of journeys happening across China are not just about the hectic travel but also about the warm embrace of loved ones that have come from afar. It is Chinese tradition over the Chunyun holiday season to blast off fireworks on New Year’s Eve, and continue to do so every day until the seasons officially ends 15 days later. One of my fondest memories from living in China was experienced while at a friend’s hometown village in Northeast Liaoning province. Though the air outside was a chilly 35 degrees below zero, our hearts were warm as the tiny village lit up with fireworks that were being shot up dozens at a time into the cold night air.

Huge gatherings of Chinese extended families come together at this time; it is not uncommon to have 30 or more relatives staying under the same roof for the holiday season. It is an amazingly warm experience filled with love and tradition that only comes around once a year.

The Spring Festival is an essential piece of Chinese culture that must be understood and respected to really be an effective observer or businessperson in this complicated country. So if you haven’t already, go wish all your Chinese colleagues and friends a happy and bless Year of the Horse!

Dan Redford is the Director of China Operations for FirstPathway Partners, and industry leading EB5 immigration fund manager. He also serves as the President of the Michigan State University Beijing Alumni Club. You can follow him and his perspectives from China athttp://www.danredford.com.

The Age of Chinese Outbound Private Investment – Published in China US Focus

I am honored to once again be published in a great periodical, China US Focus. This week, I discuss a growing trend that deserves all of our attention: the rise of Chinese private outbound investment. You can read the article on China US Focus here, or read on below:

The Age of Chinese Outbound Private Investment

While the mainstream media debates the future of the Chinese economy, the opportunist understands that China’s rapid economic growth path is only just now starting to bear fruit. We are at the beginning of a new chapter in the Chinese economy: the age of outbound private investment.

It is no secret that during China’s historic economic rise, the country has made significant investments abroad. But up until just a few years ago, a vast majority of this investment was state-led. According to the Rhodium Group, from 2000 – 2011, 70% of China’s outbound investment was carried out by state-owned enterprises. The economic climate has changed drastically in a short amount of time. In 2012, private firms represented 80% of China’s outbound transactions, and just this year, private companies accounted for 16 out of 17 Chinese outbound M&A deals.

Private firms are increasingly looking into more mature markets like the United States to grow their companies. Top industries of choice for Chinese firms include engineering and contracting, energy and mining, household appliances, automotive, and financial services. These types of investments save and even create jobs in the United States, further integrating our two economies and building a great pie.

Recently, there have been a few high profile purchases by large Chinese companies. Last year, Chinese real estate and entertainment conglomerate, Dalian Wanda Group, purchased AMC Theatres for over $2 billion, and is gearing up to use it as a platform for further expansion into the U.S. market. Even more recently, China’s biggest pork producer, Shuanghui International, bought out Virginia-based pork producer Smithfield foods for $4.7 billion.

It’s Not Just About the Companies, It is About the People 

These large-scale private purchases are merely harbingers of a greater trend of private investment and people flow between the United States and China. It truly is the dawning of a new age.

Chinese individuals are more and more looking for ways to get their assets out of China. They are spurred not only by uncertainties about the future of the Chinese market, but also certain present realities. A great majority of China’s private wealth has been built on real estate. But now, in an effort to push down inflation and prevent a housing bubble, the Chinese government has been imposed strict regulations on real estate speculation. In Beijing, for example, the purchase of a pre-owned home is now subject to a 20% tax. On top of that, even owning a second home in Beijing has been banned for new buyers.

There seem to be more changes on the horizon that are causing Chinese investors to look outward. The Chinese weibosphere (equivalent of U.S “twittersphere”) went crazy early in October when a State Council member announced that as part of the upcoming plenary session, the government is considered installing an inheritance tax.

In light of all of all this, entrepreneurial Chinese are wasting no time figuring out ways to get around this by getting out. Emigration to the West has become a preferred option. Tens of thousands of Chinese high net worth individuals are emigrating every year. They see an American green card or other residency permits in Western countries as a safety precaution; a vehicle to make it easier to move money, and their families, out.

Still, China does not make it easy on individuals to get their money out of China. According to Chinese law, an individual is only allowed to transfer up to 50,000 USD worth of Chinese yuan out of the country annually. That means that these investors need to be creative and use their network to move their assets into foreign markets.

This bodes well for foreign financial firms and money managers that stand to grow a multitude of Chinese clients in this space. Currently, there is $4 trillion of private wealth sitting around in China. Astonishingly, only 7% of that is under management. That means over $3.7 trillion of Chinese wealth is unmanaged. Why is this the case? The concept of having third party management of wealth has only begun to emerge in China. In the Chinese economy, the guanxiculture that places so much emphasis on who you know that it makes people very unwilling to trust others, even professional financial managers, with their money. But now, the learning curve that comes with investing in foreign markets is now forcing Chinese to look to professionals to help them.

New Investors, New Markets 

In fact, if Americans can understand how new and untapped this opportunity is, an earnest effort to seek out and welcome private investment from China can help to resurge our economy and rebuild communities that need a kickstart. Americans and Chinese people are actual two sides of the same coin; largely what we know about each other is what we read in the newspaper. For that reason, it is no surprise that historically, individual investment in the United States from China has been concentrated in large, high-exposure markets like New York or Los Angeles. The tide could be turning, however, as more and more investors understand that those markets are becoming saturated. They are starting to look for answers elsewhere.

Take Detroit for example. Although the Detroit market on the surface seems decrepit and failed, the Detroit real estate market has struck a cord amongst Chinese homebuyers. According to the United States National Association of Realtors, the Detroit market was one of the top 5 most inquired about markets amongst Chinese real estate buyers. This seemingly is an anomaly when considering the other markets that have historically caught the eye of Chinese such as New York and Los Angeles.

In Milwaukee, we have been able to attract hundreds of millions of dollars through the EB5 program from Chinese investors. These people are becoming more sophisticated, understanding that the best, safest, and even potentially biggest boon markets in the United States are outside of the major metropolises that they have heard of.

The time is now to start building relationships of trust directly with Chinese investors. The wave of outbound Chinese investment is only just beginning; the playing field is leveled. The question is, are you ready to ride the wave?

Daring People to Dream in China – US China Focus Exclusive

I am proud to have been featured in this week’s edition of US – China Focus. This website is a great emerging tool for students of the ongoing, complex relationship between our two countries. I wrote a piece about upcoming privatization reforms in China, and how the next wave of Chinese development needs to “dare people to dream.” You can read the article on US – China Focus, or read the text below:

China’s Upcoming Privatization Reforms: Daring People to Dream in China

Dan Redford, Director of China Operations for FirstPathway Partners

For over thirty years, China’s economy has been a disruptive and powerful force in the global economy. Now, China’s newly minted leadership has the challenge of managing this powerful economy as it shows signs of tiring. Problems of high inflation, rising property values, and a high level of bad government debt all threaten to throw China’s economy off track. Further privatization has been accepted as a way to combat these challenges, particularly in opening up government project contracts previously offered exclusively held by state-owned enterprises to the private sector. To really ensure effective privatization, China must develop a culture of innovation that gives Chinese people more ownership over the direction of this giant economy.

China’s education system is a significant barrier to innovation. Unlike in the United States, where education involves a healthy mix of in-class testing and extra-curricular activity, China’s education system is almost 100% based on test scores. From primary school all the way through to high school graduation, Chinese students are preparing for the gaokao, a written test that each student takes after completing high school that will determine their collegiate path. It is a high-pressure system that forces students to focus on test scores and numbers, and does not foster creative thought. 

Even more constraining is the strong divide between social classes. This is not the first time in China’s history that the leadership has made sweeping statements about reforms in China’s economy. The question is, will people believe that they will become a reality? China is divided into three basic classes – laobaixing (common people), fuerdai (the rich), and tanerdai (government officials and colleagues). These differences are so pronounced that it is hard for Chinese people to imagine any reforms that would change their relative position within this system.

These two aspects of Chinese society deter innovation, evidenced by a marked increase in dissatisfaction by average Chinese citizens in this economy, and an exodus of China’s rich, would-be innovative class.

Since moving to Beijing in 2011, I’ve witnessed the attitudes of average Chinese people go through a steady change. For common people, pride and excitement in China’s economic growth are gradually being replaced with disappointment and resentment. Last week, I had a cab driver ask me if the U.S. would consider liberating China instead of Syria. Why?

“This country is completely unfair. This country gets richer and richer, but I work harder and harder, and make less money.”

This change in attitude is growing along with divide between rich and poor. The government understands the severity of the problem. In January they released the official Gini Coefficient, which measures income disparity within an economy, for the first time since 2005. The Chinese claim that the number sits at .474, though a majority of independent assessments from scholars put the number over .6. Both numbers are over 0.4, which is considered a standard breaking point at which society as a whole starts to turn from generally satisfied to generally unsatisfied.

These statistics play out in China’s cities where working class citizens and migrants work and live in close proximity to the wealthy and powerful. Last year it was announced that over 51% of China’s population lives in urban areas, and China expects to enact plans to make that number increase to 70% by 2025. Unfortunately, with limited education and poor platforms for social mobility, the cities are being filled more and more with people that are not in a position to offer innovative value to a society that needs it.

At the same time that migrants and low-educated people are growing their presence in China’s economic hubs, certain habits of the educated and wealthy indicate a need to create incentives for innovation.

One of these habits is emigration. In a 2011 survey of Chinese citizens with net worth of over 10 million RMB ($1.53 million), it was discovered that over 60% said that they were considering emigrating from China. The survey, developed collectively by Bain and Company and China Merchants Bank, shows that the wealthy in China are either not sure about the trajectory of China’s future, or that they are just generally dissatisfied. One thing is clear is that they are not willing to stick around to spend time investing and innovating in the Chinese economy.

In China’s new era of privatization, the leadership should frame the reforms around giving average Chinese people incentives and resources to “dare to dream.” They will find ample opportunities as they start to open contracts previously held exclusively by state-owned enterprises to private companies. These large contracts should be given not just to those with government relationships, but those that demonstrate that they can give the best performances. Over time, this will provide evidence to Chinese people that society is indeed changing, and that taking a more entrepreneurial path could be an acceptable track to achieving a better life in China. Eventually, this will give the government teeth to actually reform the gaokao-based curriculum and encourage a balanced education system that gives Chinese people the incentives to think outside of the box. This is how to create a healthy economy that depends on and fosters innovation within its people.

Dan Redford is the Director of China Operations for FirstPathway Partners, and industry leading EB5 immigration fund manager. He also serves as the President of the Michigan State University Beijing Alumni Club. You can follow him and his perspectives from China at http://www.danredford.com.

Imported From China – An MSU Documentary

As it is every day, it is GREAT to be a SPARTAN.

I am so proud of my friend, colleague, and professor, Dr. Geri Zeldes of Michigan State University for producing and directing a great documentary about the experience of Chinese students at MSU, Imported from China. The documentary featured the journey of a few Chinese students at MSU, along with American students that reflect on their interactions with the influx of Chinese in our community. It premiered at MSU on September 17th, and will soon be distributed widely. I believe it will be a great tool for any university or school that is experiencing an influx of Chinese students and is looking to serve them better.

I am honored to have been interviewed and included in the documentary, along with some of my other respected and dear friends, including Jing Cui, Tom Watkins, Peter Briggs, and Joy Fu.

MSU is currently home to over 3,600 Chinese students. This puts our university at the heart and center of one of the world’s most dynamic and unfolding stories – the one between China and the U.S. As the documentary says, “Like it or Not, we are linked together.” At MSU, we are creating leaders of a generation that I believe will guide us through a prosperous and fulfilling modern U.S. – China relationship.

 

If you are interested in screening this video at your school or for your alumni club, please contact me and I can put you in touch with Geri.

 

Taking on Sinophobia Through Education – USA China Daily

I was privileged to have been introduced to the potential for U.S. – China relations while a student at Michigan State University. However, I’m well aware that across the United States, many remain skeptical and frankly, uneducated about what is going on in China.

Michael Barris of the USA China Daily wrote a great piece about this issue, quoting me alongside my long time friend and colleague, Tom Watkins. You can read the original here or see the text below:

 

In the midst of the chatter over China’s trade data report Thursday, there it was: Sinophobia.

“For better or worse, China has become the new linchpin of the global economy,” Investing Daily.com analyst Benjamin Shepherd wrote. Summing up the trade numbers, he said: “The old saw used to be that as goes the US, so goes the rest of the world. With China poised to become the world’s largest economy sometime in the next decade, that US-centric preconception will have to be revised.”

Shepherd’s characterization of China’s economic power as a “better or worse” proposition brings to mind Stephen Schwarzman’s comments to a New Yorker magazine reporter this spring, when the chairman and CEO of the private-equity firm Blackstone Group discussed the “hard-core, real anger” that exists toward China in the United States – sentiments that sparked his decision to launch a $300 million college scholarship for study, not here, but in China. Schwarzman, the New Yorker reported, was “hoping that familiarity with the world’s rising superpower” would “blunt growing American anxiety about changes in status.”

Schwarzman, the magazine said, first started thinking about offering the scholarship fund in 2010 when the juxtaposition of the US’ economic calamity and China’s then 9 percent annual growth rate stirred “negative attitudes” in the West toward China. “I was convinced that would create frustration in the West, and frustration would lead to anger,” Schwarzman was quoted as saying, “and that anger can lead to trade problems, and ultimately to military confrontation.”

At a certain point, he said, “it seemed logical” that “really bad things” would begin to occur. “We had to find a way to stop or ameliorate that situation.”

By establishing the scholarship fund, Schwarzman said he aimed to produce individuals who would understand China.

An effort is underway to teach the US about China. In 2006, a survey by the Modern Language Association – the organization for scholars of language and literature – showed that some 51,600 students at roughly 2,800 US institutions of higher learning were studying Mandarin – a 51 percent jump in comparison with a similar study four years earlier. The enrolment jump, MLA said, was mainly due to China’s increasing prominence on the world economic stage. For the record: Chinese is the most spoken language in the world, and more people speak English in China than speak it in the US.

But deeper obstacles can get in the way of attempts to change deep-seated attitudes about China. That’s the view of Tom Watkins, the former Michigan state schools superintendent and frequent China visitor, who has advocated stronger US-China ties for three decades.

“The biggest challenge is convincing people that the world has changed in profound and fundamental ways,” Watkins said in an interview. “We are living in a fast-paced, disruptive, transformational, technologically-driven, global, knowledge economy where ideas and jobs can and do move around the world instantaneously.”

In the years to come, Watkins said, “China, its history, culture and language will be front and center in all world decisions. The individual, city, region, state and nation that adapts to this new reality will prosper as the 21st century unfolds – others will fade from the scene.”

Another view of the issue comes from Dan Redford, the Beijing-based director of China operations for Wisconsin fund management company FirstPathway Partners. Redford said the biggest challenge in teaching Americans about China is “distance, both cultural and physical.”

“Because China is so far away, it is difficult to deliver that experience to most Americans,” he said. “So, our country will have to rely on individuals who have gone out of their way to get that experience to provide expertise and guidance on China.” He said there are “relatively few true China experts who understand China’s rise and how it has grown as a nation.”

Redford recalls being in a meeting with a local official in Michigan who claimed “he’d rather go to India on a trade mission than China because he preferred to deal with democracies, not communists”.

“That is so narrow minded and inaccurate,” he said. “I think that our education system has failed to produce effective leaders in government that can change the rhetoric and the narrative on the conversation with China.”

Unlike the analyst who saw China’s rise as a “for-better-or-worse” proposition, Redford believes the US will help its own cause by educating citizens about the changing of the guard that is well underway.

“It is widely accepted that China will have a bigger economy than the United States within the next 20 years…and perhaps sooner,” Redford remarked. “Enough said.”

Contact the writer at michaelbarris@chinadailyusa.com

 

 

Vice Premier Wang Yang delights the crowd at the U.S. – China Strategic Economic Dialogue

Over the years, the reputation of Chinese officials for being droll, dull, and boring in the public sphere has grown to almost legendary proportions. China’s last President, Hu Jintao, was famous for constantly boasting a somber, expressionless face no matter what occasion, a trend that new President Xi Jinping is hoped to reverse. (And sometimes, when the Chinese get animated it goes badly…as President Jiang Zemin experienced in his interview with the Hong Kong press in 1994: http://www.youtube.com/watch?v=3cmjaptnr6k).

So when Vice Premier Wang Yang addressed the crowd at the U.S. – China Strategic Economic Dialogue yesterday carrying an outgoing personality and speaking in well-executed sarcasm, it came as a refreshing surprise. As cited in this Reuters article, the Vice Premier said that the U.S. and China relationship is like a marriage, though joking that it should not be confused as a “gay marriage,” making light of the current U.S. political discussion on the topic. He even went on to snide about how we should not be confusing the divorce of Rupert Murdoch and his Chinese wife with having any effect on the relationship of the two countries.

Wang’s delightful personality and sense of humor adds flavor to the U.S. – China relationship, and could serve as an intangible element to progress relations that has largely been missing over the past 4 decades. Humor and whit have become staples in American politics and the Vice Premier’s commentary and attitude have already been welcomed by the U.S. diplomats at the conference.

His comments are not just catching the attention of the U.S. side. The video posted of his talk on China’s 163.com elicited almost 5000 responses from Chinese citizens, mostly voicing their support of Wang Ying and his efforts to bring America and China closer together. Some even appreciated the humor, saying “汪洋很幽默“-Wang Yang is so funny!

Still, Wang Yang’s perspective and personality are not mainstream polity in China. He is an outspoken member of the reformist end of the Communist Party, and to be sure, his compatriots at the dialogue took a much more serious tone.

At the end of the day, it can’t hurt to have one of these funny guys involved in the high level discussions between the titans to lighten the mood and remind us all that we are all just human beings trying to make the best of this Earth that God has given us.

Is the Chinese Dream an EB5 visa? – posted on Caixin Media

I recently re-entered the blogosphere and twittosphere, and the Internet Gods have already been good to me.

I co-wrote a piece with my friend and colleague, Justin Knapp, who shares my passion for Michigan, about the current state of the EB5 Immigration Investment market in China. The article, “Is the Chinese Dream an EB5 Visa?,” was posted last week in China’s largest business and finance online journal, Caixin Online.

You can read the English version by clicking here, 中文点击这里, or read the full text below:

You can read more from Justin and how to live a “Richer, Fuller Life in West Michigan” at Goodallfocus.com.

_______________________________________________________

Is the Chinese Dream an EB-5 Visa?

Both China and the United States would benefit from expanded use of an American immigrant investor program

By Justin Knapp and Dan Redford | June 28, 2013

Dream chasing is a popular topic in China these days. Thomas Friedman sparked the debate last October when he wrote a column titled, China Needs Its Own Dream. More recently, TheEconomist and CNN have also taken a gaze into the crystal ball to interpret China’s dream.

Chinese leader Xi Jinping, has loudly adopted the slogan “Chinese dream” while keeping quiet on the details of what that dream might be. Meanwhile, the American dream continues to be peddled in China’s mainstream culture and media. With foresight, the United States can benefit from this trend.

Today, more Chinese nationals than ever before are trying to live their dreams, not within the borders of China, but by gaining permanent residency status in the United States through investment and job creation. In fact, according to the Hurun Wealth Report 2012, more than 16 percent of China’s millionaires have already emigrated or submitted immigration applications, while 44 percent are planning to do so.

The Immigrant Investor Pilot Program (the EB-5 visa) was created by the Immigration Act of 1990 to stimulate growth by attracting foreign direct investment and creating jobs in America. To qualify for a visa, individuals must invest US$ 1 million or US$ 500,000 in a Target Employment Area which is a rural or high-unemployment area. Additionally, this investment must create and sustain at least 10 jobs on American soil.

Demand for the visa has fueled growth in third-party managed investment vehicles known as Regional Centers which are both privately and publicly run. To illustrate how quickly the EB-5 program has grown in the United States, the number of Regional Centers has increased from around a dozen in 2007 to more than 250 today, including at least one in every state.

While the public profile of the program has been marred by a small number of high-profile, soap-opera-like scams, the difficulties faced by applicants are in fact more mundane:  identifying profitable investment projects and creating 10 jobs. After a two-year waiting period, if an investment project fails to create 10 jobs, the foreign investor risks losing their investment and permanent residency in the United States.

Last year, the U.S. Citizenship and Immigration Services hired half a dozen economists to help evaluate the job-production claims, but many believe this added scrutiny has created a bottleneck in the approval process. The Association to Invest in the USA, which advocates on behalf of Regional Centers and industry service providers, recently noted a backlog of nearly 6,000 EB-5 petitions which are currently held up. At the low-end, assuming US$ 500,000 per investment, that’s potential for nearly US$ 3 billion and 60,000 American jobs.

Finding information about the number of deals in the pipeline is challenging. It has been reported that American businesses raised more than US$ 1.8 billion through the program in the fiscal year ended September 30, and over 7,500 would-be immigrants were issued visas. Interestingly, 80 percent of them were Chinese, a dynamic shift from the mere 25 percent just four years prior.

Time will tell how China defines its dream, whether it creates one of its own or simply adopts the American dream along with an American home. For now, Chinese investment in the United States can help boost the economy and put Americans to work. If it can stick to its founding principles and map out a clear long-term vision, the EB-5 program shows promise in helping both Chinese and Americans realize their dreams of successful and healthy local economies.