Chinese dominate pay-for-residency scheme

Customers queue up in front of a store of Dior at the Sanya International Duty Free City in Sanya city in south China’s Hainan province. Some 1,613 applications have been accepted to date for the Immigrant Investor Programme — 1,511, or 94%, of those applications have been from Chinese nationals.

On Friday morning, Children’s Minister Roderic O’Gorman, the man with direct responsibility for Ireland’s asylum seeker programmes, said that he could not guarantee that incoming refugees would not have to sleep on the street after arriving in Ireland.

“What we are making clear is we’re not in a position to guarantee everyone an offer of accommodation,” he told RTÉ’s Morning Ireland.

It was a stark admission — one that shows just how stretched Ireland is at present in terms of immigration and housing. And it’s not just the Ukrainian conflict sending people to Irish shores.

Numbers were on the rise from other countries, Georgia being a noteworthy example, long before Vladimir Putin invaded his neighbour on February 24, outstripping expected demand at a rate of knots.

The Russian war in Ukraine has certainly complicated the issue — more than 50,000 Ukrainians have since claimed asylum in Ireland. 

Up to five times more refugees have entered Ireland in 2022 than the numbers that came here in previous years. This would be a difficult trend to sustain, even in a country with an adequate housing supply.

But Ireland is currently stuck in the worst housing crisis it has experienced in living memory. It is a difficult situation to manage, to put it mildly.

The situation isn’t the same for all migrants, however, which brings us to the benignly titled Immigrant Investor Programme (IIP).

Unlike direct provision, this immigrant programme did not transfer to the Department of Children in October 2020, but stayed with the Department of Justice, which first introduced it in 2012.

At the time Ireland was in a sorry state. Bailed out by the troika, dealing with a housing market collapse and the endless bloodletting stemming from the €64bn hole punched in the economy by the banks, the IIP doubtless felt like a no-brainer. A short, sharp injection of cash into the economy in return for residency for high-net-worth individuals.

What exactly is the Immigrant Investor Programme? It’s a migrant programme for millionaires only. Or, as one senior public servant told us, 'it’s basically citizenship for sale'.

Applicants must be originally native to a country outside the European Economic Area (EEA). They must have a net worth of at least €2m, and they must be willing to invest a minimum of €1m for at least three years, and that money cannot be sourced from loans or any sort of debt — it has to come from the investors’ own resources.

Other prerequisites are that each applicant must be free from criminal convictions in any country and be of “good character”.

There are four strands to the IIP via which each person applying can place their funds: investments in Irish enterprises (minimum €1m); money placed in investment funds as approved by the Central Bank (minimum €1m); Real Estate Investment Trusts (REITs — the controversial vehicles which kickstarted the trend of corporate landlords in the Irish rental market — minimum €2m investment); and endowment (a minimum philanthropic — as opposed to investment — contribution of €400,000 placed in a project of public benefit to Ireland).

Two-year residency

In return, the investor gets a two-year residency in Ireland, which can be extended for a further three years and then an additional five years following mandatory reviews by the State.

Ireland has received just under €1.2bn in inward investment under the programme to date — the most lucrative year being 2017, when €251m worth of investments were approved. Some €132m, via 192 applications, has been approved to date in 2022.

The Department of Justice said the fund was initially set up to “encourage inward investment for the creation of business and employment opportunities in the State”.

It added, however, that it is “difficult” to evaluate the programme’s effectiveness as the various investments have not matured fully.

Though the programme was set up due to Ireland’s economic need at the time of inception, it didn’t bear significant fruit for several years.

Just 126 applications were approved in the first five years. That doesn’t mean the department was necessarily being picky — applications didn’t begin to ramp up significantly until 2016, when requests for admission jumped from 75 to 334 in just 12 months.

If that jump seems noteworthy, the hike in applications seen to date in 2022 is eyebrow-raising: some 812 official inquiries had been received by the end of September, a more than 200% increase on the 258 received in the entirety of 2021.

Whether that spike in applications has anything to do with the fact the Government is currently considering the findings of a review of the programme is unknown.

So where are these wealthy investors coming from? There’s a one-word answer: China.

Some 1,613 applications have been accepted to date (a 52% approval rate, though the real figure is doubtless a good deal higher, given the number of approvals doesn’t take into account the time lag for due diligence being performed) — 1,511, an astonishing 94%, of those applications have been from Chinese nationals.

Of the remaining applicants, 31 were from the US, 12 from Vietnam, five from Saudi Arabia, and four from South Africa, with the remaining 50 designated as ‘Rest of World’.

The department has made clear that it has no influence as to what projects the various investors put their money into — that is already decided pre-application. More than half of the applications received to date — and at €703m, 60% of the investments — have gone into Irish enterprise.

Lucky Khambule of the Movement of Asylum Seekers in Ireland described the programme as effectively meaning ‘if you have money in Ireland, then you are good to go’.

Interestingly, a minuscule number of investments — just six — have been into REITs.

Applications are approved by the minister for justice following the recommendation of a panel of senior public and civil servants, which meets at least four times a year.

While little is known about the specifics of the investments, some light has been shed on the nature of some of the payments by, of all organisations, the GAA, whose county boards have been benefitting no end from the endowment section of the programme.

At least three Leinster counties — Meath, Louth, and Kildare — are known to have sourced, or to have attempted to source, funding from the programme. Early in 2021, Meath officials announced €400,000 had been injected into the redevelopment of Páirc Tailteann in Navan via the IIP.

That stands as nothing compared with what the Louth County Board, via local independent TD Peter Fitzpatrick, has pulled off — with just under €15m to be injected into its new €20m county stadium in Dundalk via 37 separate investors.

Mr Fitzpatrick denied there was any question of “passports or citizenship or anything like that”, adding that one of the advantages to the investors is to be able to send their children to college in Ireland during their stay.

'Win-win for everybody'

“I personally think it’s a win-win for everybody,” he told Newstalk. “It’s all above board. They’re not going to be gangsters; they’re not going to be laundering money.”

Lucky Khambule of the Movement of Asylum Seekers in Ireland (MASI), however, described the programme as effectively meaning “if you have money in Ireland, then you are good to go”.

He said the IIP “does not make sense” at a time of global crisis.

“No one knows about this programme in our community, it is a shock,” he said. “It doesn’t make sense to be doing something like this at a time when people with nothing are in such desperate need for protection and shelter, whose lives have been destroyed.”

“These are economic migrants,” he said of the IIP’s investors. “I would think you have to be connected to get into a scheme like that.”