The government is making it harder for foreign investors who want to become Singapore Permanent Residents — even if they happen to be wealthy multi-millionaires.
In a bid to better manage the pace of the growth of immigrants, the government has introduced a new set of guidelines under its Global Investor Programme (GIP), which targets wealthy foreign businessmen to set up shop in Singapore.
With effect from this Friday, foreign entrepreneurs applying for the GIP need to have an annual company turnover of $30 million, an increase from the $10 million required under the previous ruling.
Another significant change is the amount that foreign investors need to invest in Singapore.
Currently, GIP applicants must invest a minimum amount of $1 million. But from January next year, the amount will be raised to $2.5 million.
Under the previous rules, those investing at least $2 million can utilize up to half the amount on an owner-occupied private home. That option will no longer be available.
The new guidelines will also exclude the main candidate’s parents and parents-in-law from his or her GIP application for PR status.
The GIP is offered by Contact Singapore, an alliance of the Economic Development Board and the Manpower Ministry. It was started in 2004 to ease the way for foreign entrepeneurs and businessmen to set up and run their business here.
According to The Straits Times, a spokesman for Contact Singapore would not reveal the number of investors who have become PRs through this method.
Although some of those changes will be effective from January next year, all applications are subjected to the new requirements as the average processing time for an application is eight months.
The tougher rules come at a time when the government is tightening the influx of PRs and foreigners into the country.
Those applying for PR and citizenship face more stringent criteria such as a higher income bar and residential requirements to ensure that they can contribute to Singapore economically and also integrate well into society.
And these measures seem to have taken effect.
In 2009, 59,500 foreigners were granted PR status as compared to 79,200 in the year 2008.
The GIP is similar to other government schemes which aim to attract the wealthy by offering PR status. They include the Monetary Authority of Singapore’s Financial Investor Scheme, which targets foreigners with a minimum of $20 million in net personal assets.
Other countries such as New Zealand and Australia also offer such schemes.
Still, there is a concern that the new measure would drive away investors.
Mr Leong Wai Ho, senior regional economist at Barclays Capital, told the same paper that the changes would not deter investors from applying for the scheme as most “definitely will have more than that amount to invest”.
However, he noted that “removing the property option might be detrimental for the property market outlook in the near term, but it removes speculative measures”.
Political observer, Eugene Tan of Singapore Management University said that the changes show that the government is addressing the concerns of Singaporeans, especially those who feel that PR status is given away easily.
He said, “In a way, it is raising the bar, and so that helps enhance the talent pool here.”