Is Hong Kong The Next Big EB-5 Market?

What’s going on in Hong Kong and why might it become the next big EB-5 market?

On Wednesday, September 4, 2019, Hong Kong’s Chief Executive Carrie Lam announced the withdrawal of the extradition bill, but many citizens say it’s too little, too late.

Withdrawing the controversial extradition bill was one of five demands of the Hong Kong protesters. The other four demands were not met and they, ultimately, may not even be the citizens’ biggest concern. The three months of protests, violence, and economic damage that it took for the government to withdraw the bill, may disturb the people of Hong Kong far more and for far longer.

Initially, the protests and campaigns were comprised of younger men and women, but the unrest grew and became backed by bankers, teachers, civil servants, accountants, financiers, and insurers.

Safety became a huge issue in Hong Kong. Violence between demonstrators and police erupted. Tear gas and gasoline bombs were used. The international airport shut down and roads closed, blocking citizens from traveling.

After millions of citizens took to the streets in Hong Kong to protest the extradition bill, the Chinese military began sending new troops to potentially quash the protests.

With no comfort from Chief Executive Lam’s remarks on Wednesday, Hong Kong citizens must decide their next steps. Here is where the U.S. EB-5 Program may play a significant role.

The 3 major Hong Kong citizens’ concerns include:

1. Democracy

2. Safety

3. Economy

Hong Kong citizens may soon be looking to move. So, could moving to the U.S. be a solution?

For some citizens of Hong Kong, it may be. The U.S. may appeal to Hong Kong citizens’ desire for democracy, safety, a stable government, a stable economy, top schools, and a strong global business market.

Why might they consider the EB-5 visa?

Although the EB-5 visa is pricey, with a minimum investment amount requirement of $500,000, it may still appeal to citizens of Hong Kong who would like to immigrate to the U.S. According to Business Insider, 1 in 7 Hong Kong citizens is a millionaire. Additionally, Hong Kong is the most expensive housing market on Earth. Therefore, moving to the U.S. may result in a higher quality of living. Another benefit of the U.S. is the sheer amount of opportunities available. Education-wise, for example, Hong Kong, which is about 1.41 times the size of New York City, has 13 universities. New York City has over 100 universities and colleges, and the U.S. as a whole, has as over 5,000.

How hard is it to apply? EB-5 Program requirements:

Invest $500,000 in a targeted employment area project or $1 million in a non-targeted employment area project. (Investors must be able to prove that these funds came from lawful sources.)

The capital investment must be made into a for-profit U.S. new commercial enterprise.

The project must create 10 full-time jobs for U.S. workers for two years.

EB-5 Program Questions:

Does Hong Kong have its own EB-5 visa quota or is it subject to Mainland China’s visa backlog?

The Department of State lists Hong Kong S.A.R. as independent from Mainland China when it comes to the EB-5 Program. That means that they have their own EB-5 visa quota and are not subject to Mainland China’s visa backlog. (Hong Kong S.A.R. does not have a visa backlog.)

If an investor was born in Mainland China, but their spouse was born in Hong Kong, will the couple be subject to Mainland China’s EB-5 visa backlog? 

Since Hong Kong is treated as a separate country for EB-5 visa purposes, an EB-5 applicant can use their spouse’s country of origin (Hong Kong) to avoid the visa backlog facing Mainland China applicants.