The EB-5 visa for Venezuelan investors
One of the largest EB-5 markets in South America, Venezuela has suffered from political turmoil, high crime rates, shortages and an ongoing socioeconomic troubles for more than a decade. While the EB-5 program wasn’t very popular in Venezuela throughout the 2000s according to the U.S. Department of State data, in FY2009, the country saw a sudden increase in the number of issued EB-5 visas.
This challenging economic and political context prompted more than 5.6 million people to leave the country as of 2021, according to news reports. Many high-net-worth individuals also sought a more stable life abroad, leading to an increase in the number of EB-5 petitions filed by Venezuelan investors over the years.
EB-5 visa statistics for Venezuelan nationals
According to the U.S. State Department’s annual Visa Office reports, in FY2016, there was a 50% increase in EB-5 visas issued to Venezuelan nationals compared to the previous fiscal year. Venezuela became one of the three countries that were among the top-10 countries by number of petition filings that year, even though it wasn’t on the list of the top-10 countries by visas issued.
From FY2017 to 2019, South America was the fastest-growing EB-5 market as a region. In FY2019, with a total of 172 EB-5 visas issued, Venezuela ranked 7th on the global list of countries by the number of EB-5 visas issued. In FY2020, a total of only 50 EB-5 visas were issued to Venezuelan petitioners, likely due to the negative impact of the pandemic and unprecedented processing times.
On the other hand, adjustment of status is a popular visa issuance pathway among Venezuelan nationals when compared to petitions filed from abroad. Data shows that in FY2019, more EB-5 visas were issued to Venezuelan investors already residing in the United States (115 visas) than those living in Venezuela (57 visas). Similarly, while consular processing accounted for more than half of the EB-5 visa issuances in major EB-5 markets in FY2020, Venezuela was the exception with adjustment of status petitions making up the majority.
Why is EB-5 popular in Venezuela?
Venezuela’s wealth in US dollars shrunk by 48% between 2007 and 2017, according to a New World Wealth report. Home to a once-booming economy that depended on the world’s largest oil reserves, Venezuela has since struggled with hyperinflation, shortages, international sanctions, and political unrest. The quality of education and public safety levels plummeted, leading the wealthy Venezuelan population to seek permanent residency in the United States for a better future for their families.
According to the 2010 census data, Florida is the top destination among Venezuelan nationals that migrate to the United States, making up 0.5% of the state’s population. Some sources also state that there is a large population of Venezuela-born petitioners investing in the EB-5 program from Colombia and other neighboring countries they reside in.
Source of funds issues for Venezuelan nationals
One of the main issues Venezuelan petitioners face while proving source of funds is the constant depreciation of the Venezuelan bolivar. Even though a new currency, bolivar soberano, replaced the former bolivar fuerte in 2018 in an effort to battle hyperinflation, the devaluation did not make a significant impact on the country’s economy. The exchange rate between the local currency and the U.S. dollar continues to cause issues for Venezuelan EB-5 investors who want to carry out money transactions from local banks, prompting them to transfer their funds to the United States from neighboring countries.
What is the current retrogression situation?
Venezuela’s final action date is current as of February 2022.
What does the future hold for Venezuelan EB-5 investors?
With the ongoing political and economic instability occurring in the region, EB-5 industry professionals expect the EB-5 market to grow in South America in 2022 and beyond. Although FY2020 has proven to be a difficult year for the immigration industry worldwide, the large number of Venezuelan HNWIs seeking to find brighter opportunities hold promise for the growth of the Venezuelan EB-5 market. As safety is the primary concern among Venezuelan investors—rather than high returns on investments—the pathway of obtaining a green card in the United States through the EB-5 program is only expected to become more popular among wealthy individuals from Venezuela, where mass migration has marked the past decade.
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