China is a growing economy with a rapidly rising number of millionaires. With expanding wealth, China is also witnessing increased wealth migration and a growing exodus of well-heeled citizens leaving its shores to settle in other countries.
According to the Henley Private Wealth Migration Report 2023, 10,800 high-net-worth individuals (HNWIs) migrated out of China in 2022. This makes China the leading country in the world with the biggest net outflow of HNWIs, a trend that has continued since 2013.
There are many reasons why so many Chinese citizens are seeking permanent residency or citizenship abroad.
Most applicants want to improve their global mobility, have access to better education and healthcare, enjoy higher living standards, and live in a country with greater political stability.
Some could be looking for better employment or business opportunities, while others may be planning their retirement in a secure environment.
The strict and extended lockdowns during the pandemic also acted as a catalyst for many Chinese nationals to consider moving to countries with lesser state interference and more individual freedom.
Whatever their motive to relocate, the United States has always remained one of the top destinations for emigrating Chinese HNWIs. As the world’s leading political and economic power, it offers them both prosperity and stability with a promise of unrestricted freedom and life choices.
EB-5 Visa Demand from China
Recent Factors that Spurred the EB-5 Visa Rush
Understanding the RIA’s Impact on EB-5 Visa Demand
EB-5 Visa Demand from China
Over the years, the EB-5 Immigrant Investor Program has been an immensely popular choice for Chinese nationals willing to invest in a U.S. business in exchange for permanent resident status and citizenship. In fact, investors from China have historically been the largest nationality in the EB-5 program.
The EB-5 program was introduced by Congress in 1990 to stimulate the U.S. economy through job creation and capital investment by immigrant investors. It enables foreign nationals and their eligible dependent family members (the spouse and unmarried children under 21) to obtain lawful permanent residency in the United States by investing in a commercial enterprise and creating 10 permanent full-time jobs for qualified U.S. workers.
The program is administered by the federal agency United States Citizenship and Immigration Services (USCIS).
According to U.S. Department of State (DOS) data, out of the 10,855 EB-5 visas issued in FY 2022, 6,125 were received by Chinese applicants, amounting to more than 50% of the total.
Research shows that this trend has persisted over the past decade. Despite fluctuations in demand, more than 70% of the total 81,125 investor visas issued by the United States between 2010 and 2019 were granted to Chinese investors.
Recent Factors that Spurred the EB-5 Visa Rush
In the wake of mass shutdowns and limited availability of visa services during the pandemic, there was a steep drop in the number of EB-5 petitions. However, as travel restrictions were lifted and immigration services returned to normalcy, the EB-5 visa saw an unprecedented increase in demand, with maximum applications coming expectedly from China.
Moreover, in March 2022, the momentous EB-5 Reform and Integrity Act of 2022 (RIA) was enacted into law, introducing much-awaited comprehensive reforms in the EB-5 program.
The legislation also reauthorized the briefly suspended EB-5 Regional Center Program for another five years, providing a sense of stability to EB-5 stakeholders.
Consequently, the RIA was a major reason why the demand for the EB-5 visa skyrocketed in 2022, reflecting investors’ renewed interest and confidence in the program.
Understanding the RIA’s Impact on EB-5 Visa Demand
With ever-increasing demand and limited supply, EB-5 applications from China have faced severe backlogs in recent years, resulting in long waiting times for visa approval.
Aiming to encourage investments in low economic activity areas and, in the process, reducing the EB-5 processing time for future applicants, the RIA introduced measures such as visa set-asides and priority processing that benefit Chinese investors.
By allocating 32% of the total EB-5 visa quota as reserved visas—20% for rural areas, 10% for high-unemployment regions, and 2% for developmental infrastructure projects—Chinese investors were offered an invaluable opportunity to avoid the long and highly backlogged queue of unreserved category applications.
Also, as per the RIA, EB-5 petitions for rural projects will qualify for priority processing, making the process even faster for rural EB-5 petitions.
Further, for investors already residing in the United States on a valid non-immigrant visa, the RIA introduced EB-5 Concurrent Filing, by which they can file Form I-485 for adjustment of status (AOS) concurrently with their EB-5 petition.
This provision grants such investors the right to stay in the United States while their EB-5 petition is being processed, thus reducing the total processing time for their visa. It also makes them eligible to apply for a work permit, which can be obtained quickly within a few weeks.
Effectively, concurrent filing allows applicants to enjoy all the benefits of a Green Card even as they wait for their EB-5 petition to get adjudicated.
Many Chinese immigrants in the United States are utilizing this provision to get speedier permanent resident status, particularly students. An F-1 student visa makes them eligible for concurrent filing, and by filing Forms I-526E and I-485 concurrently, they get all the Green Card benefits, such as freedom to work and travel, as well as access to reduced tuition rates.
These exceptional provisions of the RIA — visa set-asides and concurrent filing — proved to be the game-changer that opened the floodgates to new EB-5 petitions from China.
In spite of huge backlogs, the appeal of the EB-5 visa program shows no signs of diminishing for Chinese investors. Implementation of the RIA has presented them with new opportunities and the assurance of a fast-tracked Green Card. It has also made the EB-5 program more streamlined, secure, and transparent for immigrants to invest with renewed confidence.
Altogether, with the demand for EB-5 visas from China going strong, we can expect the U.S. economy to continue benefitting from the capital funding generated by Chinese EB-5 investors for a long time.
