Recently, more
media attention has been drawn to the growing population of new Chinese
millionaire and billionaire immigrants flooding Western countries like the U.S,
and especially Canada. The article highlights several people, all sharing in
common the identity of what most people would call "trust-fund
babies" called fuerdai, a mandarin slang term for rich kids spending
their parents money. Most are corrupt Chinese officials kids who were sent with
their families and friends to Western countries amidst recent crackdowns on
such illegal activities in China.
Countries like
Canada that sport new immigration policies catering to wealthy foreign
investors have seen huge increases in rich immigrants. "According to
Canada's government figures, from 2005 to 2012, at least 37,000 Chinese
millionaires took advantage of a now-defunct immigrant investor program to
become permanent residents of British Columbia, the province that includes
Vancouver...The metropolitan area of 2.3 million is home to increasing numbers
of ethnic-Chinese residents, who made up more than 18 percent of the population
in 2011, up from less than 7 percent in 1981, according to government figures."
The article goes
on to mention the super car clubs that these kids who are often younger than 21
create, while buying/leasing new super cars that range from $150,000 to
$400,000 every few weeks. This seems to be a response to being unable to show
their wealth in China, where such actions and ownership of the cars would raise
questions amongst the populace and officials, while it is less incriminating
and odd in Western countries. Along with the massive influx of the super
rich fleeing China, they have driven up home prices, making the Vancouver area
almost impossible to live in as prices are through the roof with foreign real
estate agents buying up properties and creating an affordable housing crisis,
with prices "increasing from 2005 to 2015, to about 1.6 million Canadian
dollars ($1.2 million)", with the majority of these being absentee owners.
Question: Does the immigration of the
super rich in this case have any beneficial impact to the economy
considering their spending habits? Negative impacts? Are they just creating an artificial price bubble?
Link to the
article:
http://www.nytimes.com/2016/04/13/world/americas/canada-vancouver-chinese-immigrant-wealth.html?ref=international&_r=0
For more
information, there are several articles highlighting cases like these in the
U.S and other countries, most noticeably in California. Just google nytimes and
Chinese trust fund kids or something along those lines and you should find
them.
From what I gathered, the article seemed to point more as a stab at the children of the incredibly wealthy and in some cases, the incredibly corrupt. In reference to the housing market, it seems that the houses are so expensive in the first place, that driving up the prices of outlier homes will not create as much of an impact, or even a significant one whatsoever, at least certainly in comparison to the homes purchased by the middle class.
ReplyDeleteI think that the immigration of rich Chinese families have more beneficial impacts than negative ones. They may be buying and leasing super expensive cars, but all of that money is going into the economy. In terms of the Vancouver housing market, it seems like the houses were already super expensive before these families moved in. So I don't see it as being much of a problem. Overall, these families provide more economic good than bad.
ReplyDelete