by EB5Investors.com Staff
In February of this year, Canada announced its plan to shutter its federal Immigrant Investor Program and Federal Entrepreneur Program. Citing “limited economic benefit” and extensive backlogs in applications, the Canadian government has decided to abandon the programs in favor of new, yet-to-be-revealed, pilot programs.
The programs, previously popular alternatives to the U.S. EB-5 program, were structured quite differently from their American counterpart. Instead of an at-risk investment, investors in the Canadian IIP were asked to make an $800,000 (CAD) loan to be divided between provinces and territories. The interest free loan would be used to fund projects and create jobs for a period of five years, and was guaranteed to be repaid.
Perhaps because of this loan structure, the Canadian program never provided the desired economic benefit. Despite the lack of results, the IIP alone had 65,000 individuals queued for processing—more than any other investment immigration program in the world, according to Citizenship and Immigration Canada’s Feb. 11, 2014 news release. Those jilted investors are now likely looking elsewhere for immigration opportunities.
The cancellation of the Canadian program has occurred at the same time that the EB-5 program is experiencing explosive growth, with a record number of investor applications in 2013. The U.S. EB-5 program is not the only alternative immigration avenue, however. Though EB-5 remains highly competitive with its relatively low minimum required investment and attractive U.S. green card, immigrant investors have a wealth of options, as evidenced in Rohit Kapuria’s accompanying article.
Until the Canadian government discloses further details of its suggested venture capital program, EB-5 may just be perfectly poised to pick up the slack.