Is Canada Taking Our Capital?

How Red Tape Surrounding the EB-5 Program May Be Driving Funds into Canada, Away from the U.S.

The continued economic instability of the United States has left elected officials in all major cities scrambling for vital funds to pay teacher salaries, repair infrastructure, and keep the city clean and safe. As they rearrange funds at the expense of vital programs, Executive Director of Chicagoland Foreign Investment Group, Taher Kameli, says that the answer to our economic woes really lay overseas by utilizing the generally unfamiliar EB-5 program. With a number of conditions and requirements, though, the U.S. EB-5 program can be overlooked by investors for the more convenient Canada Immigrant Investor Program. Kameli weighs in on how raising EB-5 awareness among government officials in the U.S. can help reduce red tape surrounding the program and drive much needed money into our infrastructure and economy.

The EB-5 program in the United States was created in 1990 to entice foreign investors into opening businesses in America to boost the economy in exchange for a green card, allowing for conditional residency for individuals investing between $500,000 and $1 million in a new commercial enterprise. Said enterprise must directly employ 10 US citizens or authorized immigrants full-time and the investor must engage in the business in some form, either directly through day-to-day managerial tasks or indirectly through policy formation. The minimum investment amount varies based on the geographical area, also termed “Regional Center,” and whether or not said area is a “Targeted Employment Area” (TEA) as designated by the state, meaning that said area has an unemployment rate at least 150% of the national average. Similarly, Canada features both the Canada Immigrant Investor Program and the Quebec Immigrant Investor Program, offering business-minded individuals the opportunity to immigrate to Canada with their families by making a five-year passive investment with the government with the option to finance. The return of funds is government-backed and permanent residency status given to investors. The Canada IIP is so popular, in fact, that it’s currently closed until July 1, 2012 due to an influx of applications. Where as the EB-5 program provides temporary, conditional U.S. residency based on the ability of the investment to create jobs, the Canada and Quebec IIPs provide unconditional residency to the investor and their family.

Though the EB-5 program was established over 21 years ago, the vast majority of U.S. lawmakers and government officials are undereducated on or unaware of the program and it’s tremendous potential for revitalizing the United States. Canada, on the other hand, is active in its Immigrant Investor Programs, using it to boost the economy and fund projects throughout the country.

“When taken advantage of, the EB-5 program has the ability to have a significant positive impact on the infrastructure of the United States. The problem lays in the fact that most U.S. law makers and government officials have not been properly educated on EB-5 and thus don’t give it the attention it deserves,” says Kameli. “Foreign investors are drawn to government-backed and supported programs, which is what makes the Canada and Quebec IIPs so attractive. They want to know that their money has the support of the United States government. If more U.S. government officials could come out in public support of the program and make it more attractive to investors, EB-5 could have a tremendous impact on our country.”