WHAT would make a wealthy entrepreneur spend $15 million for the right to live in Australia?
That’s the question on everyone’s lips after the federal government quietly announced a new visa, which will be trialled in the US over the next year.
The Premium Investment Visa (PIV), launched on July 1, offers rich business people Australian citizenship in return for them ploughing their money and skill into domestic innovation.
So how will we convince them they want it?
THE CHINESE ARE FANS
Until now, Australia only offered Significant Investment Visas (SIV) to rich migrants, which didn’t require any skills, but instead a commitment of $5 million to be invested in specific ways.
Of 1679 applications since the scheme began, 90 per cent were Chinese migrants, mainly looking at NSW and Victoria. “The majority of people have been from China because of property prices,” migration lawyer and Results Migration managing director Christian Dawson told news.com.au. “There’s the casinos, like in Sydney.
“The lifestyle is better. They’re really coming to start a new life.”
Many financial investors with families want their kids educated at Australia’s schools and universities, learning English and growing up in a healthier, safer environment.
Not only is Australia conveniently located close to Asia, but it allows investors to avoid a sweeping corruption crackdown at home, according to Reuters.
WE WANT TALENT
The SIV gives the opportunity of citizenship “to people who are wealthy but not as skilled — skilled in business,” Mr Dawson said. “You’re buying your way in.”
Now the Abbott Government wants more.
“The PIV requires strong business skills, to add an element of innovation to the Australian community,” Mr Dawson said.
The investment requirements under the PIV will be far more flexible, but the visa will be available at the invitation of the government only, with potential recipients nominated by the Australian Trade Commission (Austrade).
Austrade says on its website that it is looking for “a small number of highly talented and entrepreneurial individuals who can translate those skills and talents into areas which deliver a long-term economic benefit to Australia” and will be “highly selective”.
The entrepreneurs’ areas of expertise could be varied, although an Austrade spokesperson told news.com.au: “Biotech is an area where Australia has had a number of innovations but has struggled to attract the early funding you see in the US.”
WHY THE US?
America, Australia’s top two-way investment market, is only the starting point for the program, and it will expand to other such markets over time.
“The US is the leading global hub for venture capital that attracts entrepreneurs and innovators who are citizens from all around the world. Our job will be to convince just a handful to choose Australia,” an Austrade spokesperson said. “Beginning the program in the US does not mean that only US citizens will be eligible — entrepreneurs and innovators of any nationality will be eligible for consideration.”
Basing the new scheme in the US could help Australia diversify so that investment was not just coming from the Asian market, Mr Dawson suggested.
But there will be challenges if Australia ends up competing with such an influential market: the US has more world-leading universities, comparable quality of life and strong innovation.
The Australian government will have to hope the nation’s long-term uninterrupted growth, business opportunities and connections to Asia could seal the deal for enough entrepreneurs to make the multimillion-dollar scheme a success.
THE BOTTOM LINE
Ultimately, as long as these visa schemes bring money into the Australian economy, the government will be happy.
Foreign direct investment to Australia shrank this year, according to the World Investment Report 2015, and the country comes eighth for foreign investment, below Brazil, Canada and Singapore.
The PIV will help the government to attract funding to Australian innovation, but wealthy new citizens still don’t necessarily bring their businesses and employment opportunities with them.
In May, an immigration overhaul allowing the richest foreigners to pay their way into Australia for $50,000 was suggested, but Tony Abbott shut the idea down. Skilled visas remain paramount.
“The SIV and PIV will always be in the background,” Mr Dawson said. “Otherwise you’ll only have wealthy migrants who bring nothing else.”
We want capital, we want skills and we want innovation. The year ahead will determine whether we can really have it all.
This article originally appeared on news.com.au