European life attracts Chinese
Updated: 2015-06-22 06:46
By RIAZAT BUTT(China Daily)
Last year, there were 153 separate Chinese investments in Europe, worth $18 billion, driven by the real estate, food, financial services and energy sectors, according to research from consultancy firms Baker & McKenzie and Rhodium. The top five European destinations were the UK, Italy, Netherlands, Portugal and Germany, with investment sums per country ranging from $1.6 billion to $5.1 billion.
"Chinese investment in Europe has become much more diverse in recent years and is now extending into all parts of Europe," says Thomas Gilles, chairman of the EMEA-China Group at Baker & McKenzie. One area that has experienced remarkable growth is commercial real estate, which surged from "virtually zero" before 2013, according to Baker & McKenzie, to $2.8 billion in 2013 and $3 billion last year, not including future development costs. Tourists, students and emigrants are fueling this property-buying boom, with Chinese real estate investment in the EU amounting to $6.4 billion between 2000 and 2014.
Larry Wang, president of the Beijing-based immigration consultancy Well Trend, says investing in real estate can offer easy access to Europe, but the process varies from country to country. "The Europe market has very good potential. The Chinese are very traditional and are willing to invest in real estate as long as they can emigrate. There are some countries that are popular but I don't see it (Chinese immigration to Europe) as having very good momentum."
In the past few years, Cyprus, Greece, Malta, Portugal and Spain have introduced so-called golden visas, which eventually allow residency in return for property investment or other forms of investment. But some packages are more attractive to Chinese investors than others.
Portugal's Deputy Prime Minister Paulo Portas says its program has brought 1.27 billion euros ($1.41 billion) of investments to Portugal in two years. "It would be idiotic if we closed shop and other countries earned this money," he said in February. Currently, a real estate investment of 500,000 euros is needed in Portugal, although this figure may drop to 350,000 euros. The initial temporary resident visa requires individuals to spend at least seven days in Portugal in the first year and then 14 days in the remaining five years. Visa holders can then apply for permanent residency and, a year later, for citizenship.
Spain's program opened a year later, in 2013, and it also has a minimum property investment threshold of 500,000 euros. To receive citizenship, however, investors must remain in the country for 183 days a year for a minimum of 10 years. Spain's foreign ministry says that 324 people had signed up for the golden visa in a 12-month period, citing the total value of real estate investment as 256.1 million euros.
Wang says: "Our clients need to live there (Spain) for six months. This is too long. The requirements stop the Chinese from applying. China has one of the most vigorous economies in the world. If people have to move their whole families they will. I've communicated with certain (European) ambassadors. What they want is money. They want investment. They don't want so many Chinese to come over. With the Schengen countries you don't need a visa. China has too many people. They want another ID, the opportunity to live somewhere else."
The 2008 global financial crisis has not deterred the Chinese from Southern European countries, which have reported strong interest in the golden visa programs.
"The Chinese have a thought that when a country's economy is down and property prices are low, they can take advantage and purchase properties with a low price. They have a tangible thing on hand. Greece is a major tourist attraction. The Chinese are smart; they don't care about the financial crisis," says Wang.
But for some Chinese, it is still the little things that matter. Gu Geixin, 43, from Xi'an in Shaanxi province, left China for Hungary in search of a better life.
"I expected security, a moderate cost of living and advanced education. That country has generally met my expectations. I was reluctant to leave (China) but now I have gotten used to my new life and feel great," Gu says.
Bu Han contributed to this story.