Wealthy Chinese have been pumping up property prices in many cities around the world by utilizing various investment immigration schemes.
This has led to growing complaints among locals about unaffordable housing, prompting places such as Canada, United States and Hong Kong to slow down or suspend such immigration programs.
Amid this situation, mainlanders are now increasingly turning to South Korea’s Jeju Island, helping it become one of the hottest new immigration destinations in Asia.
Easy access from China’s main cities, good education system, relatively cheap home prices and an enchanting landscape are the reasons why the Chinese are flooding into Jeju.
Duty-free shops and restaurants on the island are also very accommodating to the needs of Chinese people. More sales staff there now speak fluent Mandarin, and prices are displayed in both renminbi and US dollar. Meanwhile, many local banks have even put up special counters to serve the Chinese.
After a new real-estate investment immigration policy took effect in 2010, the number of Chinese immigrants has skyrocketed in Jeju.
Under the policy, which took effect in February 2010 and will be in force until April 2018, F-2 residency visas are granted to foreigners who invest a minimum of US$500,000 in condos or other resort accommodations on Jeju Island.
The F-2 visa can be upgraded to an F-5 permanent residency visa after five years.
Apart from buying a resort unit worth at least half-a-million dollars, foreigners can also become Jeju residents by acquiring an apartment unit and depositing 3 million yuan (US$480,000) of savings into a local bank for a few years.
A Jeju tour company J&P Entertainment told EJ Insight that golf resort condos are the favored choice of Chinese customers.
As of August 2014, a total of 1,438 condo units had been sold to Chinese nationals for a total of 960 billion won (US$871 million), according to the Korean newspaper The Hankyoreh.
In all, 768 visas have been granted to Chinese under the investment program since the first issuance in 2010. As the total number of such visas issued to foreigners over the period amounts to 783, it means the Chinese make up 98 percent of the visa recipients.
Once a person becomes a Jeju resident, his spouse and children are also eligible for resident visas. The immigrants then qualify for education and medical benefits provided by the Jeju government.
However, as golf resorts sprouted across the island, overdevelopment has caused serious damage to Jeju’s natural landscape. A map provided by Jeju’s tourism center reveals that there are at least 20 golf resorts on the island.
Some farmers and local residents have complained that Chinese developers have been buying up land plots at low prices and selling off the property at much higher levels.
They say the problem is rooted in the investment immigration policy, which has been focused too much on real-estate development, which brings no substantial benefit to other sectors of the economy or local people’s lives.
Won Hee-ryong, the governor of Jeju Special Self-Governing Province, has publicly blasted the overdevelopment on the island, and said he will never allow Chinese investors to develop the mountainside of Mount Halla– an extinct volcano and popular tourist spot located in the middle of Jeju.
In order to protect the locals’ interests as well as Jeju’s natural heritage, the government has set up stricter criteria for foreign investors. There has also been speculation that authorities plan to tighten the rules for grant of immigration visas.
While the debate will continue to rage about the merits of the immigration scheme, there is no doubt that the Jeju administration faces a daunting challenge with regard to its growth strategy.
Striking the right balance between protecting the island’s culture and environment and stimulating the local economy is the real test that confronts local authorities.
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