Demand for Australia’s Significant Investor Visa program is beginning to rise with a 24 percent and 4.4 percent jump in a number of applications and total investments respectively for 2018-19.
Slow Recovery Since 2015
In July 2015, Australia modified the SIV by mandating how investors must allocate the minimum $5 million investment into different asset classes in order to qualify for fast-track permanent residence.
Further, investors no longer had the option of qualifying for the SIV by buying a residential property.
This led to demand plummeting as investors preferred other less-expensive options like Portugal, Greece, and other programs where a passive investment into a home or any other real estate asset was enough to qualify for the golden visa.
| Year | SIV Applications | SIV Investments Million AUD |
| July 2018 – June 2019 | 423 | $955 |
| July 2017 – June 2018 | 341 | $915 |
| July 2016 – June 2017 | 438 | $2,025 |
| July 2015 – June 2016 | 213 | $2,775 |
| Nov 2012 – June 2015 | 2573 | $4,395 |
The number of applications apart, there has also been an increase in the number of approvals by states and territories, which augurs well for the future.
$50 Billion Worth Of SIV Benefits
Since November 2012, the SIV program has attracted FDI in excess of AUD$11 billion. Of course, this does not include non-SIV investments made by those acquiring permanent residence after the five-year lock-in period under the program.
Considering more than two thousand Ultra High Net Worth individuals have been welcomed to the country, it can be safely said that the SIV program has been beneficial for the Australian economy.
Fund managers estimate non-SIV investments to be as high as four to five times the SIV investments made by wealthy applicants, which works out to a total FDI inflow of AUD$50 billion over the past nine years.
Concerns: Chinese Dominance and Concentration of Benefits
Yet, these impressive numbers have not silenced murmurs about the effectiveness of the program. Australia’s immigration minister recently hinted at a review of the program to ensure a better deal for Australia.
Yet another change in the program may stifle the slow but steady recovery in SIV demand over the past 12 months.
One factor contributing to growing concerns about the SIV could be the dominance of Chinese applicants who account for 87 percent of all SIV applications and approvals. Including applicants from Hong Kong, this figure rises to more than 90 percent.
Another area of concern could be the dominance of two states – Victoria and New South Wales – in cornering bulk of SIV investments flowing into the country. In 2018-9, these two states accounted for 86 percent of all SIV approvals.
In fact, other states and territories could garner 14 percent of all investments is an improvement over 2015-16, when 97 percent of total SIV investments went to the two dominant states.
While SIV investors are inured to frequent talks of reviews and changes, any ill-conceived tinkering with the program will set the clock back and hurt FDI inflows into the country.