MORE than 1340 foreign multi-millionaires, mostly from China, have bought fast-track residential visas by agreeing to invest at least $5 million each in Australia to call this country home.
But even as more foreign millionaires line up, the Federal Government’s own advisory body has warned there is little or no economic benefit to Australia in selling the visas, except for fund managers earning commissions and fees.
Almost 60 per cent, or 779 of those high-wealth foreigners are now living in Victoria after being required to make individual investments in Australia of at least $5 million each, according to Department of Immigration data.
Despite the newly arrived millionaires having to be endorsed or nominated by state governments, or Austrade, assessments in Victoria are still being made on whether the influx of investors has added to local jobs or economic growth, the key reason for establishing the Significant Investor Visa program. But the federal Productivity Commission found the economic benefits of granting visas to foreign millionaires investing in Australia were “weak” and the “only direct economic benefit” went to the visa holders themselves “and fund managers”.
“The benefits to Australian businesses seeking investment and the economic benefits to the broader Australian community are likely to be very small or non-existent … it is not clear that the benefits exceed the costs of giving away a valuable asset: permanent residency in Australia,” the commission’s draft report from November said.
An additional 1008 SIV applicants lodged requests in 2014-15 for permanent residency in Victoria, a process which takes four years after initially arriving in Australia and lodging the required $5 million in investments that meet government criteria.
Almost 88 per cent of all SIV recipients since the program began in November 2012 have come from China, about 3 per cent from Hong Kong, with Malaysia, South Africa and Japan among the top five source countries. “The purpose of the visa is to provide a boost to the Australian economy and to compete effectively for high net worth individuals seeking investment migration,” the Department of Immigration and Border Protection policy states.
The University of Melbourne Centre for Public Policy’s Nicholas Reece said the SIV program should aim for the best “multiplier” effect to stimulate business and jobs growth and changes last year to move further away from residential property to venture capital and new technology business was welcome.