Hong Kong Will Give Foreigners Residency for a $3.8 Million Investment – Robb Report

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Hong Kong is once again becoming a pay-to-play city.

The Asian metropolis has decided to grant residency to those who invest 30 million Hong Kong dollars ($3.8 million) into it, Bloomberg reported on Tuesday. The Capital Investment Entrant Scheme, as the plan is called, was previously in place from 2003 to 2015, and it’s now being reinstated in response to the city’s slowdown over the past few years.

The investment-to-residency program will start in the middle of next year, and it’s expected to bring in roughly $15.4 billion every year, according to Christopher Hui, the city’s secretary for financial services and treasury. Hui added that some 4,000 people could participate each year, too.

In recent years, even before the pandemic began, Hong Kong has experienced an outflow of residents, thanks in part to anti-democratic politics in the city. It’s also seen a downturn in the local property market, resulting in less revenue from land sales. This slowdown has led city officials to turn to new(-ish) forms of growth like the residency program.

The plan will require a mandatory investment of approximately $384,322 in a portfolio that supports local technology and other innovations, according to Bloomberg. Other potential assets include stocks, debts, and funds. Residential real estate will be excluded from the program, and industrial and commercial real estate will be limited to $1.3 million.

Hong Kong’s reliance on pay-to-play residency isn’t novel—for that city or others around the globe. For years, many countries have given foreigners residency in exchange for monetary investment. In Europe, for example, demand for these so-called golden visas exploded over the summer, with countries like Portugal, Greece, Spain, and Italy seeing an increase in applications and issuances.

Like Hong Kong a few years ago, though, some countries have cracked down on who’s allowed residency. Ireland and the United Kingdom both ended their programs recently, after grappling with the optics of wealthy people being able to buy their way into those countries. Opponents of such schemes have argued that they drive up real-estate prices and push out locals.

For the time being, Hong Kong seems to be setting aside those concerns and betting on foreign investment to bring back some of the city’s wealth.  



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