Australia is allowing wealthy Chinese to buy their way to residency for A$5 million and the program is booming. More than 1,000 people have applied so far, a number that would bring at least $5 billion in flows to the country and many more are expected after Canada cancelled its wealthy investor program.
Immigrants are required to put the A$5 million into government bonds or complying funds that invest in assets such as infrastructure, real estate and agribusiness, for four years, according to the Department of Immigration website. The initial visa requires residency of at least 40 days a year over the period, after which permanent residency can be granted.
Australia announced a reboot of the program in May to attract more investors.
For a country that’s struggling with a red-hot property market and a squawking about a high Australian dollar, it’s a puzzling move. The Chinese are certainly getting richer while the air quality continues to deteriorate. I expect the money to keep flowing and helping AUD/USD.
It’s a good time to be an Australian asset manager with connections in China.
