A scheme in Australia to allow foreigners - mainly from China - to effectively buy permanent residency is facing criticism over concerns that it is fuelling the overheated property market and could be used by criminals to launder money.
Designed to attract investment from wealthy foreigners, the so-called "golden ticket" visa programme grants residency to those investing at least A$5 million (S$5.2 million) over four years or A$15 million over 12 months.
Since it began in November 2012, about 90 per cent of those receiving visas were from China. About 1,228 foreigners had obtained the visas up to the end of January this year.
But the scheme has proven controversial and critics have long warned that there is no guarantee of an overall financial return to Australia. Commentators have noted that investors can later withdraw their money - typically after four years - and may have invested much of their funds even without the scheme.
An Australian expert on immigration, Professor Jock Collins of the University of Technology Sydney, said he believed the scheme had done little to promote entrepreneurship and should be scrapped.
"It was worth a try, but it has not worked," he told The Straits Times.
"Most migrants come as temporary or skilled migrants and turn to entrepreneurship. That is the most fertile way of doing it."
The federal government altered the scheme last year to force applicants to place part of their investment in riskier assets such as venture capital, but there are growing calls for the visas to be abolished.
A report by the federal govern- ment's Productivity Commission released on Sept 12 recommended ending the scheme, saying the case for keeping the visas was "not compelling". It said the residency requirement for applicants - who need to spend just 160 days in the country over four years - was very relaxed and made it "effectively a non-resident permanent visa".
"Because there are no English-language requirements… and no upper age limits, it is likely that these immigrants will generate less favourable impacts than other immigrants," the report said. "The economic benefits… are likely to be relatively modest and accrue mainly to the visa holders and to fund managers. Overall, the case for retaining these visas is weak."
Significantly, the commission noted that security agencies in Australia have warned that the scheme could be used to launder money. Despite noting that no cases of laundering had been proven, the commission said efforts by the authorities to monitor overseas investments were costly and not "foolproof".
"Some inquiry participants, including law enforcement agencies, raised concerns about the potential for money laundering and other nefarious activities," the report said.
"There is a risk that (the visas) might be used as a pathway for investing 'dirty money' in Australia."
The federal government has said it will consider the report but has not commented on whether it will retain the visas.
Canada abolished a similar visa scheme in 2014 after concluding that it provided little benefit and was adding to the overheated housing market. Similar concerns have emerged in Australia, where property prices in Sydney and Melbourne have been surging.
Discussing the scheme last year, Mr Peter Hughes, a migration policy expert at the Australian National University, said it needed "careful scrutiny" to ensure that it did not attract criminals and that the economy received a real benefit.
"One wonders why, if these investments are truly desirable, they cannot stand on their merits and attract sufficient capital without the need to effectively subsidise them by offering visas and a pathway to Australian citizenship as an incentive to foreign investors," he wrote on the Lowy Institute's Interpreter blog.
The scheme was originally predicted to bring in A$10 billion a year if the full capacity of more than 2,000 visas were granted annually.
A report by the Immigration Department in February said the scheme had brought in a total of A$5.4 billion since November 2012, but revenue raised is likely to fall following a drop in applications since the rule changes were introduced last year.
Prof Collins said he believed demand for the visas had been too low to assist the economy. He noted that the scheme also raised ethical issues about the ability of wealthy individuals to forgo the standard checks and expectations imposed on other migrants. "The lukewarm response has meant it has not had much of an impact," he said. "There are ethical issues… The scheme suggests that migrant millionaires can always get a place in the sun wherever they choose."