US President Barack Obama announced during the Apec Summit in Beijing that he will extend the validity of visas which is expected to boost private equity investment, real estate deals and cross border transactions in the US.
The United States and China announcement recently that they has extended the validity of business and tourist visas to up to 10 years, and student and exchange visas to up to five years has been very well received. Previously Chinese business travelers, as well as tourists, had to apply for a new visa to the US every year.
This extension could mean more Chinese individuals as well as institutions buying more US-based assets.
In President Obama’s speech at the Asia Pacific Economic Cooperation forum, he stated that last year, 1.8 million Chinese visitors to the United States contributed US$21 billion to the American economy.
The White House believes a competitive visa arrangement could bring as many as 7.3 million Chinese travellers to the US by 2021, contributing US$85 billion a year to the economy.
The US issues nearly 2 million non-immigrant visas in China each year, according to the US Department of State. The new visa policy will offer more frequent access to the US. Therefore, the consensus is that these changes are likely to drive up the number of private equity investments and real estate deals. It is estimated that a large number of Chinese companies have brought entire buildings in the past two years for figures in excess of US$500 million.
Not only will the new extended visas boost investment and tourism, but also alleviate the pressure on Consulate resources. Travellers were previously assessed in relation to immigration intent every time they applied for a visa. Therefore, as they will now have longer visas, and can look at a longer investment perspective the feeling is that this will open up many more opportunities for Chinese individuals and Corporations in the USA and provide the US with a welcomed and increased revenue stream.
The Extended Visas will help sustain the growth that has been seen thus far.
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