By Anayat Durrani
The economic downturn, the war in Ukraine, and skills and labor shortages are three major factors impacting immigration policy worldwide, according to the recently released Worldwide Immigration Trends Report by global immigration firm Fragomen’s Knowledge Group. The report takes a deep dive into current political, economic and cultural factors, offers future projections and analyzes current immigration trends.
Highlights of the report cover the waning of restrictive policies in response to the pandemic and countries’ new focus on economic sustainability. The report also covers the economic downturn, such as the rising costs due to inflation and subsequent impact on immigration policy as well as the war in Ukraine and its impacts on immigration policy.
“Geopolitical events have had an impact on residency and citizenship by investment,” says Nadine Goldfoot, London-based managing partner of Fragomen’s UK practice. “Particularly, the crisis in Ukraine lead to movement trends out of Russia. With limited options for Russian nationals, many have selected Dubai and benefited from their enhanced golden visa offers, increasing the success of the route exponentially.”
Impact on Golden Visa programs in Europe
Golden visa programs have been used to attract foreign investment, draw capital and bolster tourism in countries worldwide. However, the EU has worked to curtail them due to potential risks of corruption and money laundering. Malta, Cyprus, Latvia, and Bulgaria had already succumbed to EU pressure to scrap some of their initiatives, and most recently Portugal and Ireland followed.
“Pressure from the EU and other intra-governmental organizations as well as impact on pressure on national economies has led to the sudden closure of a number of citizenship by investment routes across the EU,” says Goldfoot.
She called the closures largely passive and typically real estate based investments, but says the trend will now need to move toward pathways that stimulate job creation, innovation and entrepreneurial activity.
“Following the global financial crisis, housing busts in markets like Spain and Portugal spurred property-led investor visa schemes. As markets recovered, countries focus now need to be on active investment and job creation,” says Goldfoot.
With unemployment rates still low and jobs unfilled, many countries are seeking immigration policy initiatives to fill those worker and skills gaps, especially technology roles, per the report. This has meant countries seeking new pathways and jobseeker visa programs, and fusing the tourist and business classifications to attract skilled workers. Relaxed immigration policies are predicted to continue as countries struggle with high inflation, low unemployment rates, and skills shortages worldwide over the next 12-18 months, the report said.
The growing trend of digital nomad visas
Another trend is the post-COVID remote and hybrid work explosion.
“Covid-19 led to a huge growth in mobility requirements The number of people who were suddenly able to do their existing work but in a new country expanded rapidly,” says Goldfoot. “The “digital nomad” boom has brought many more people into the ambit of global mobility - and countries have responded in trying to attract these people.”
Nearly 40 countries and territories have launched digital nomad visa pathways through March 2023, with programs pending in several other countries, per the report.
But, she says an increase in nomadic workers, led by freelancers and the self-employed, will be constrained by tax rules and other considerations. She says taxation complications, social security and labor law considerations will limit the freedom of employed staff benefit.
“While destination countries are keen to work on simplifying tax rules – engaging outbound countries to cooperate will be more challenging, but this could be key to replenishing lost revenue from passive investment routes,” says Goldfoot.
Meanwhile, the digital transformation continues worldwide as systems become more sophisticated and inter-operability of online systems with other government departments is on the rise, the report said. Online system ETIAS (the European Travel Information and Authorization System) is set to be implemented in November 2023. Similar to the US ESTA system, this system will require visa-exempt non-EU nationals entering Schengen Area for business or tourism for up to 90 days to pre-register their travel for approximately EUR 7.
“The introduction of ETIAS will mean that non-EU HNWI who have residency and homes in EU countries are going to have to be very cautious not to risk exceeding their 90-day Schengen allowance,” says Goldfoot.
EB-5 Immigrant Investor Program
The EB-5 program was created in 1990 to boost the U.S. economy through capital investment and job creation by foreign investors—and the year 2022 was significant for the program. The passage of the Reform and Integrity Act in March of 2022 (RIA) renewed a pathway for EB-5 foreign investors to immigrate to the U.S., particularly through the Regional Center route.
The RIA reauthorized the expired Regional Center Program through September 30, 2027 and brought with it substantial changes.
California-based Fragomen partner, Mitch Wexler, says the RIA re-engineered the EB-5 program in several ways, including significant integrity measures to which Regional Centers and their sponsored projects must comply. As a result, it will ensure that the strongest, most compliant programs remain, which he says is healthy for the industry.
“From an investor perspective, the new set aside visa categories breathed life, at least for a period of time, into EB-5 for high volume countries like China, India and Vietnam, resulting in increased interest from these markets where we are well-positioned to assist clients,” says Wexler. “Since these categories are new, their quotas have not yet been filled and applicants from these countries aren’t experiencing a backlog.”
The RIA also allows those in the U.S., in most cases, who file for EB-5 to concurrently file for the actual green card status. He says previously the EB5 petition (I-526) had to first be approved and if there was no backlog, the applicant in the U.S. could then apply to have their status adjusted to conditional residency.
“The current filing change also results in extendable work permits and travel documents, even if a backlog is established before the green card status is approved,” says Wexler.
He says his firm is seeing an uptick in filing as EB-5 applicants currently residing in the U.S. as students or temporary workers are finding out that they can take advantage of concurrent filing.
“This trend is further exacerbated by the 11% selection rate for the limited number of H-1B work visas, thus spurring graduating foreign students to pursue this alternate option to remain and work in the U.S. without an H-1B visa,” says Wexler.
Powered by Froala Editor