Canada's immigration chief admitted yesterday that the flouting of residency rules by mainlanders was one of the reasons its investor visa scheme was axed.
But Citizenship and Immigration Minister Chris Alexander was quick to point out that it was not the "principle reason" and that Canada's door was still open to Chinese migrants.
Announcing stricter criteria for a new investor scheme to be launched later this year, Alexander told the South China Morning Post during an interview in Hong Kong that the required amount needed to qualify for the new immigrant investor venture capital pilot would be more than double that of the previous visa's C$800,000 (HK$5.6 million).
"We want Chinese investors in Canada and the door is open, the pathways are multiple," Alexander said. "We are making these changes for them."
Canada scrapped its investor visa last month, dumping 65,000 applications, about 45,500 of which were filed by mainlanders applying in Hong Kong.
Alexander said the new fund would be privately managed and a competition would be held to select the managers. The funds would be invested in "at-risk" start-ups for more than five years, longer than the previous scheme.
He said money would be directed into industries such as the internet, biotechnology, entertainment, animation, film and television.
"We have very vigorous start-up hubs in Vancouver, in Calgary, in Toronto, in Montreal and in many smaller Canadian cities like Waterloo," he said.
Alexander said there would be one pooled fund for the pilot programme, so investors had little control over where their money went, but this could change when the programme launches.
Quebec continues to accept 1,750 applications a year for its parallel investor visa, with a maximum of 1,200 applications from any single country.
Alexander said investors, especially those from the mainland, not meeting residency requirements had been a factor in the termination of the original visa programme, but the main reason was the size and productivity of the investments.
It was not so much of an issue with Hong Kong applicants as it was with mainlanders, and there were thousands of investigations under way into immigrants who had gained Canadian citizenship, not just on the investment visa, without meeting residency requirements, he said.
"A significant number of people found ways to get around the residency requirement and that essentially means you're giving people status in Canada without actually benefiting from their presence," he said.
"The amount was small. The investment performance was weak," he said. "Last time we did the numbers, only about half of the resources distributed to the provinces had been actually invested in productive projects."
Alexander said another factor was the "almost insuperable" backlog of applicants, who would have to wait a minimum of six to seven years. He said the total backlog of visa applicants had fallen from nearly one million to less than 400,000 since scrapping the investment visa and the backlog of federal skilled worker visa applicants.
Alexander added that mainland investors' impact on rising home prices in cities such as Vancouver was "negligible to zero".
He also dismissed any growing resentment of rich Chinese immigrants for buying their way into the country. "You'll hear all kinds of anecdotal information, but the reality of Canada is that immigration is seen as part of our national vocation," he said. "There are voices in the United States, there are certainly voices in Europe, there are voices in Asia that really are negative about immigration. You will not find that point of view organised or prominent in Canada at any level."
Nearly 100 disappointed mainland investor applicants, some of who have been on the waiting list for several years, have filed a lawsuit against the Canadian government over its decision to scrap the scheme. "We face litigation all the time," Alexander said, adding that many mainland immigration consultants openly admitted to helping investors who had no intention of meeting residency requirements.