Markham crossed by a long avenue flanked by five lanes of fast food and half-empty sidewalks. This bedroom community just outside Toronto city loses its mark as an American residential suburb as we access one of the outdoor malls that dot the city, teeming with all kinds of shops with signs in Mandarin Chinese restaurants pompous and pedestrian Asian features. Examples that reflect why Markham has become ground zero of Chinese migration in Canada.
Around 120,000 of its 300,000 inhabitants are Chinese, most of which came in separate waves over the past two decades. First, since the mid- 90s, coinciding with the uncertainty surrounding the handover of sovereignty of Hong Kong to China, and a second, until today, has brought thousands of Chinese to one of the countries most traditional migration in the world. Many of them looking for opportunities, but Highglen streets like Avenue or the nearby suburb of Richmond Hill, attest that many others did not migrate for purely economic reasons.
Instead, they are wealthy immigrants living in mansions six to eight rooms, some with Greek-style columns and three garages that house expensive cars and onto a garden with perfectly cut lawn. The price, modest: two million dollars. "In China, if you have an escape route you're not thinking ahead," said Elizabeth Long, a local lawyer who provides immigration services. Refers to the million and a half of Chinese millionaires, some of them his customers, who move heaven and earth to get residency, and eventually citizenship - abroad. And to make their fortunes safekeeping. What else is life insurance against political uncertainty and witch-hunts in China.
It is no coincidence that Canada is one of the favorite destinations of Chinese millionaires. It has a first-class educational opportunities for their children, besides being a safe country legally. And, until 2012, was also a destination that could easily migrate: enough to invest C $ 800,000. Although currently this option is only applicable in the province of Quebec, other federal immigration programs are still open and are used by Chinese immigrants. The trickle of applications, therefore, does not stop, even though many of those who manage the approval are actually living in China, where their business. But what leads them to seek an exit strategy?
In 2011 a survey by the Hurun Report magazine, Forbes competition in China, revealed that 14% of the rich then had emigrated or were in the process of doing so, while another 46 % were considering. "I see an increase in the number of Chinese who do not believe in the future of China," said a Hong Kong lawyer intermediate in the process. " There are many Chinese millionaires who currently are not sleeping well. When they come to see me are very nervous. The first thing you want is to put his wife and children in Canada or the U.S., because it takes away pressure on them, "he explains. The Bo Xilai case, which uncovered a web of corruption at the highest political level amid infighting in the Chinese Communist Party (CCP), was interpreted by some as a notice to mariners. And hosted by the current president, Xi Jinping, anti-corruption campaign seems to have put on guard communist aristocracy that has amassed huge fortunes and not always within the law.
Although it is early to know the real impact of measures that are sensed more aesthetic than structural measures to eradicate corruption, the fact remains that many successful entrepreneurs and senior officials try to take cover - with - their families and fortunes abroad, knowing that the boomerang effect of corruption in China is always a quick and direct to the disgrace pathway. " The fact that many Chinese millionaires committing 'sins' when creating their fortunes motivates afraid and decide to leave," said Zhang Xiaoping, journalist and writer upcoming Chinese magnates, for whom it is no surprise that they decide expatriate wealth.
"You can say that many of those who have become rich have committed illegalities and also had to establish connections with the power to amass their fortunes. They know that the government, whether local or provincial, you can use that against them at their discretion, "says Zhang. Perfect example of the sudden descent into h**l was the case of Huang Guangyu. Considered to 2008 one of the richest men in China thanks to its business selling appliances through its chain Gome, this businessman was sentenced in 2010 to 14 years in prison for corruption, market manipulation and other crimes. While few doubt the guilt of Huang in paying hundreds of thousands of dollars in bribes, there are also those who question the real motives of his incarceration in a country where illegal business practices are the order of the day.
Not only that China will be at 2013 on 80th from a list of 177 countries in the Index of Corruption Perception prepared by Transparency International. Is that revelations about the fortunes of the Chinese political elite realize what they are endemic corruption and nepotism in the Asian country. In 2012, The New York Times and Bloomberg documented in journalistic exclusive paths, hidden wealth, in and out of China, two of the regime strongmen: 2,700 million dollars accumulated family former prime minister, Wen Jiabao, and the millionaire family heritage of the current president, Xi Jinping. All a missile at the waterline of the credibility of the CCP.
Therefore, the climate of distrust in political and judicial system, which is with arbitrary frequency, does nothing but aggravate the feeling of insecurity in the circles of businessmen, politicians and senior officials, who paradoxically are most benefited the current status quo in China. Winners of economic openness are those who now distrust, which explains why try opening a " loophole " and to save his money. Around this exodus of affluent families and fortunes was created therefore a lucrative business intermediation played about 200 agencies in Beijing, Shanghai and Hong Kong. " It is dangerous for an officer to exhibit their wealth, as you risk being punished. So decide to take their money out, "confirms an employee of Peking agency serving primarily middle-ranking officials, usually provincial or local level.
"Our main job is period when political meetings in Beijing and the NPC or the quinquennial congress of the CCP. Here are our potential customers, "adds the source, who asked that his name not be mentioned. "There are officials who want to put their fortunes safe. Rarely listed transactions, if they are investigated by the government, but that 's the family: children, spouses, relatives, "he adds. Also, also cites pollution, food insecurity and limited educational opportunities as reasons contributing to these elites make the decision to migrate and not only to expatriate their money.
In this fever to safety, the U.S., Canada, Australia, Singapore and the UK are the preferred destinations by the Chinese, but the economic crisis has led many other countries to adopt migration programs for investors. Spain, which provides residence permits to non-EU exchange for buying a home worth more than 500,000 euros worth, has recently joined a long list that also includes Portugal, Scotland, Holland, Greece, Latvia, Cyprus, Lithuania, Bulgaria or even small Caribbean islands like St. Kitts and Nevis.
In Cyprus, the Chinese have joined the Russians as major investors of luxury villas that promise sun, access to the Mediterranean and obtaining residence permit in one of the European countries with lower taxation. Moreover, it provides its next entry into the Schengen area, which is an added attraction for the Chinese because they allow freedom of movement by the European Union. Angelos Marcou, local commercial developer Cybarco, upload your SUV for us to teach the Sea Gallery complex in the hills of Limassol, called Little Moscow because of its high density of Russian residents. For two million can access a new four-bedroom house with private pool, sea views and high-end standards. " Our major customers are Russian. But now they have started to get Chinese, "he explains. The company says that in 2012 closed hundreds of transactions with Asian customers.
In Nicosia, the director of the Agency for the Promotion of Investment in Cyprus (c**a, its acronym in English), Charis Papacharalambous confirms that Cyprus granted a residence permit to invest 300,000 euros on the island and have a spotless criminal record. The nationality costs a lot more: $ 15 million deposited in a Cypriot bank. But on this flight to safety and the future - as - impunity cases, the elites of China must also devise a way to get your money, or part of it, outside of China. The question is not whether his wealth was obtained legally or illegally, even if they intend to migrate or not. Central to many of them is to take their money from China to reduce your risk. Leaving it exposed to losing everything.
But how do you do it in a country that, by its strict controls on capital outflows, limiting the movement of capital abroad than $ 50,000 per year? The nonprofit Global Financial Integrity (GFI), a Washington-based organization in a recent report estimated that 1.07 billion illicitly out of China between 2002 and 2011, the increased flow of illicit capital of the world. "The main motivator behind this illicit flow is the hidden accumulation of wealth, ie secretly get rich," says its president, Raymond Baker, in his office in the U.S. capital. The survey figures, according GFI are based on both official data from the International Monetary Fund (IMF) and trade data of individual governments, corruption in China would put in certainly alarming levels.
The most commonly used technique is as old as simple and, of course, is not unique to China: price manipulation in the business operations of import and export. " Price changes between 10% and 15% are virtually impossible to detect and prosecute," said Baker, so this method is highly effective for executives of state enterprises can, through subsidiaries in third countries secretly rich at the expense of public money. No missing experts linking this technique with the depletion process that supposedly would Chinese SOEs suffering at the hands of their executives for their own personal enrichment. This system " can not stand if it is not from the top of the Communist Party," a police source in Hong Kong. " But it does not because no one has an incentive to stop it."
The mispricing in trade transactions, beyond corruption, an ideal place for Chinese entrepreneurs take out their own money to China vehicle. But there are other methods: from art sales to overseas buyers underestimating the selling price, to legally apply for approval for investment in the end does not run, to the rudimentary way of using couriers crossing the border wads of money or intermediaries to send hundreds or thousands of small wire transfers or remittances. Last year, a woman was sentenced to 10 years in prison in Hong Kong for making transfers 39,500 over three years for a total value of $ 876 million. Another man was also jailed in 1700 for evading those dates million in just eight months.
But who wants to get their fortunes from China, whatever the origin of this, is in Macau gaming industry and a terrific partner for this purpose. In fact, 69 % of casino revenues in the former Portuguese colony, already billed seven times that of Las Vegas, is generated in the so-called VIP rooms: areas restricted to the public where the big players, mostly from mainland China, betting huge sums in an atmosphere of luxury and beautiful women. Well, in this business model play a central role intermediaries and promoters (junkets, in English), it being legal in poorly regulated gaming industry in Macau, are those personal connections and the power of seduction to lead the casino to the big players.
One of the services offered is precisely of that player move funds from mainland to the tables of the casino lounges China. And they do it through underground channels, from couriers to so-called underground banks or in the shade. It is clear, therefore, that controls the outflow of capital in China are not at all an obstacle for Chinese millionaires who decide to put part of their fortunes safe abroad. If they also get residency or citizenship in another country, will probably be ready to go back to sleep reasonably quiet.
Tags: Chinese, kept, nobility, safe