International migration of China : status, policy and social responses to the globalization of migration 978-981-10-6074-8, 9811060746, 978-981-10-6073-1

Table of contents :
Front Matter ....Pages i-xxvii
In the Era of Globalization: The Phenomenon of International Migration in China (Lu Miao, Huiyao Wang)....Pages 1-13
In a Different Region of the World: The Categories of Chinese Migrants Abroad (Lu Miao, Huiyao Wang)....Pages 15-51
Reverse Migration in China: Contemporary Chinese Returnees (Lu Miao, Huiyao Wang)....Pages 53-84
Global Talent Migration: The Barrier and Breakthrough of Foreign Immigrants in China (Lu Miao, Huiyao Wang)....Pages 85-103
Evolution of China’s Immigration Policies: Visa Polices and Talent Attraction Programs (Lu Miao, Huiyao Wang)....Pages 105-124
Suggestions on Establishing the Internationally Competitive Talent Immigration System (Lu Miao, Huiyao Wang)....Pages 125-135

Citation preview

Lu Miao Huiyao Wang

International Migration of China Status, Policy and Social Responses to the Globalization of Migration

International Migration of China

Lu Miao Huiyao Wang •

International Migration of China Status, Policy and Social Responses to the Globalization of Migration

123

Huiyao Wang Center for China and Globalization Beijing China

Lu Miao Center for China and Globalization Beijing China

ISBN 978-981-10-6073-1 DOI 10.1007/978-981-10-6074-8

ISBN 978-981-10-6074-8

(eBook)

Library of Congress Control Number: 2017947850 © Springer Nature Singapore Pte Ltd. 2017 This work is subject to copyright. All rights are reserved by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. Printed on acid-free paper This Springer imprint is published by Springer Nature The registered company is Springer Nature Singapore Pte Ltd. The registered company address is: 152 Beach Road, #21-01/04 Gateway East, Singapore 189721, Singapore

Acknowledgements

International Migration of China: Status, Policy and Social Responses to the Globalization of Migration is a new book on the latest development of international migration in China, especially on Chinese global talent migration. Based on extensive research and analyses, the authors have presented the latest trend and development on international migration in China. It will be a book for the quick and well understanding on the opportunities and challenges for the international migration situation in China and the government’s latest policy analysis in this respect. The authors want to express the support given by Beijing Dongyu Global Talent Research Foundation for the research grant given to make this research project possible. Thanks also go to the assistants involved in helping of the project, such as Dr. Qiran Zhang, a joint Postdoctoral Fellow of the Center for China and Globalization (CCG) and Tsinghua University as well as Minke Li, an intern at CCG. We would also like to thank Dr. Yixi Lu and Mr. Jason A. Jean for their review and helpful assistance. Ms. Yue Yuanren was also helpful in communicating this book with the publisher. Finally, we would also very much like to thank Han Qiu and William Achauer from Springer Publishing who have the great vision in selecting this research topic and advising and supporting throughout the process. June 18, 2017

Lu Miao, Ph.D. Huiyao Wang, Ph.D.

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Contents

1 In the Era of Globalization: The Phenomenon of International Migration in China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1 Introduction: Chinese International Migration . . . . . . . . . . . . . 1.2 Causes of Chinese International Migration . . . . . . . . . . . . . . . 1.2.1 Economic Development Gap and Income Disparities . 1.2.2 Social Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.2.3 Educational Resources. . . . . . . . . . . . . . . . . . . . . . . . . 1.2.4 Environmental Issues . . . . . . . . . . . . . . . . . . . . . . . . . 1.2.5 The Political and Legal Environment—The Concept of Freedom . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3 Current Situation of Chinese International Migration . . . . . . . 1.3.1 Chinese Migrants in the U.S. . . . . . . . . . . . . . . . . . . . 1.3.2 Chinese Migrants in European Union (EU) Member Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3.3 Chinese Migrants in Australia and New Zealand . . . . 1.3.4 Chinese Migrants in Japan . . . . . . . . . . . . . . . . . . . . . 1.3.5 Chinese Migrants in Africa . . . . . . . . . . . . . . . . . . . . . 1.4 Characteristics and Trends of Chinese International Migration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.5 Concluding Remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 In a Different Region of the World: The Categories of Chinese Migrants Abroad . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1 Introduction: Categories of Chinese Migrants Abroad . . . . . . 2.2 Chinese Investor Migrants . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2.1 Destinations of Chinese Investor Migrants . . . . . . . . . 2.2.2 High-Net-Worth Individuals (HNWI) in Developed Countries/Region . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2.3 Future Trends of Investor Migrants . . . . . . . . . . . . . . .

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2.3 Chinese Skilled Migrants . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3.1 Geographic Distribution . . . . . . . . . . . . . . . . . . . . . . . 2.3.2 The Characteristics of Chinese Skilled Migrants . . . . . 2.4 Chinese Students Overseas . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4.1 Overview of Mobility of Overseas Chinese Students . 2.4.2 Development Trends of Overseas Chinese Students . . 2.4.3 Factors Influencing Chinese Students . . . . . . . . . . . . . 2.5 Concluding Remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Reverse Migration in China: Contemporary Chinese Returnees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1 Introduction: Contemporary Chinese Returnees . . . . . . . . . . . 3.2 Survey on Contemporary Chinese Returnees: Employment and Entrepreneurship Traits . . . . . . . . . . . . . . . . . . . . . . . . . . 3.2.1 Survey on Chinese Returnees . . . . . . . . . . . . . . . . . . . 3.2.2 Survey on Chinese Returnee Entrepreneurs . . . . . . . . . 3.2.3 General Situation of Returnees’ Employment . . . . . . . 3.3 Returning Chinese Promoting the Development of China’s New Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.3.1 Entrepreneurial Start-Up Environment in China . . . . . 3.3.2 Major Forces Impacting the Development of China’s New Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.4 Concluding Remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Global Talent Migration: The Barrier and Breakthrough of Foreign Immigrants in China. . . . . . . . . . . . . . . . . . . . . . . . . . 4.1 Introduction: Global Talent Migration . . . . . . . . . . . . . . . . . . 4.2 The Migration Status of Foreign Talents in China . . . . . . . . . 4.2.1 Foreign Investment Immigrants in China . . . . . . . . . . 4.2.2 Foreign Students in China . . . . . . . . . . . . . . . . . . . . . . 4.2.3 Foreign Skilled Immigrants in China . . . . . . . . . . . . . 4.2.4 China Become an Attractive Destination . . . . . . . . . . . 4.3 Global Talent Migration: Barriers and Breakthroughs . . . . . . . 4.3.1 Normalization of Global Talent Movement . . . . . . . . . 4.3.2 Imbalance of Global Talent Flow in China . . . . . . . . . 4.3.3 Barriers to Global Talent in China . . . . . . . . . . . . . . . 4.3.4 Breakthroughs of Chinese Global Talent Migration . . 4.4 Concluding Remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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Contents

5 Evolution of China’s Immigration Policies: Visa Polices and Talent Attraction Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.1 Introduction: China’s Immigration Policies Past and Present . . . . . 5.2 Promoting the Reformation of Visa Policy in China. . . . . . . . . . . . 5.2.1 Influencing Factors of Promoting the Reformation . . . . . . . 5.2.2 Facilitation of Visa Policies Between China and Other Countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.2.3 Attracting Overseas Chinese to Return to China . . . . . . . . . 5.3 Talents Attraction Programs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.3.1 Thousand Talents Program . . . . . . . . . . . . . . . . . . . . . . . . . 5.3.2 Talents Attraction Program in Provincial/Municipal Level . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.4 Polices for Retaining Talents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.4.1 Welfare Services for Permanent Residents . . . . . . . . . . . . . 5.4.2 Expanding the Talent Hunting Scope . . . . . . . . . . . . . . . . . 5.5 Future Possibilities to Promote China’s Immigration Policies . . . . . 5.6 Concluding Remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Suggestions on Establishing the Internationally Competitive Talent Immigration System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1 Introduction: The Status Quo of Talents Immigration in China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.2 Overseas Chinese Roles in Enhancing “The Belt and Road” Initiative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.3 Suggestions on Establishing a Systematic Immigration System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.3.1 To Accelerate the Study of the “Investment Immigration Act” and “Skilled Immigration Act” . . . . . . . . . . . . . . . . . . 6.3.2 To Establish a Unified Regulatory Agency for the Foreign High-Level Talent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.3.3 To Complete and Open the Investment Immigration and Skilled Immigration Category and Lower the Application Threshold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.3.4 To Make the Foreigners Naturalization Policy . . . . . . . . . . 6.3.5 To Establish the Migration Bureau in China . . . . . . . . . . . . 6.4 To Strengthen the Immigrants Integration Services and Unconventional Immigration Management . . . . . . . . . . . . . . . . . . . 6.5 Further Improve the Visa Approval System . . . . . . . . . . . . . . . . . . 6.6 Concluding Remarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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About the Authors

Dr. Lu Miao is the Deputy Director General of the International Writing Center of Beijing Normal University. She is also the Co-founder & Secretary General of the Center for China and Globalization (CCG), the largest Chinese independent think tank with nearly 100 full-time researchers and staff. CCG has been ranked among top 10 think tanks and No. 1 independent think tank in China by University of Pennsylvania Think Tank and Civil Society Program. Dr. Miao is also the Secretary General of China Global Talent Society as well as China Western Returned Scholars Association Policy Advisory Committee. Dr. Miao got her Ph.D. degree on Contemporary Chinese Studies from Beijing Normal University and was a visiting scholar at New York University and Harvard University. She is a co-author of many Chinese Social Science Academy Blue Books and Chinese Social Science Foundation’s research project reports. Moreover, Dr. Miao has written books which have described Chinese outbound business and global talent. Indeed, her latest books include Global Think Tanks which is the best seller on the subject in China, as well as China Goes Global: How China’s Overseas Investment is Transforming its Business Enterprises (Palgrave Macmillan). Dr. Huiyao Wang is the Founder and President of Center for China and Globalization (CCG) and the Dean of Institute of Development of South Western University of Finance and Economics. The Chinese Premier appointed him as a Counselor of China State Council. He is the Vice Chairman of the China Association for International Economic Cooperation Association in the Ministry of Commerce. Dr. Wang is a member of Migration Advisory Board of the International Organization of Migration (IOM), United Nation. He is also an advisor of Yale University Asia Development Council, a member of the advisory board of Richard Ivey School of Business in Asia, a Steering Committee Member of Metropolis International and an advising member to the board of the Association of Executive Search Consultants in New York. Dr. Wang was a Senior Fellow at Harvard Kennedy School and was a visiting fellow at Brookings Institution. He has published over 50 books and 100 articles and papers on Chinese global talent and migration, returned scholars, students’ study abroad and the overseas diaspora.

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About the Authors

His latest English books include Reverse Migration in Contemporary China (Palgrave Macmillan), as well as Entrepreneurship and Talent Management from a Global Perspective: Global Returnees (Edward Elgar), Globalizing China: The Influence, Strategies and Successes of Chinese Returnee Entrepreneurs (Emerald).

List of Figures

Fig. 1.1 Fig. 1.2 Fig. 1.3 Fig. 2.1 Fig. 2.2 Fig. 2.3 Fig. 2.4 Fig. 2.5 Fig. 2.6 Fig. 2.7 Fig. 2.8 Fig. 2.9 Fig. 2.10 Fig. 2.11 Fig. 2.12 Fig. 3.1 Fig. 3.2 Fig. 3.3 Fig. 3.4

An investigation on the reasons for high-net-worth individuals (HNWIs) investor migrants in mainland China . . . . . . . . . . . The number of Chinese migrants in New Zealand between 2009 and 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . China’s migration deficit between 1990 and 2013 . . . . . . . . . The number of U.S. investment immigration (EB-5) visas issued between 2007 and 2015 . . . . . . . . . . . . . . . . . . . . . . . EU blue cards issued in Germany . . . . . . . . . . . . . . . . . . . . . Top 5 nationalities receiving EU blue cards in first half-year of 2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Youth labor market outcomes have been declining . . . . . . . . Distribution for overseas Chinese professionals . . . . . . . . . . . Geographic distribution of the top 1% Chinese scientists between 1st January 1999 and 30th April 2009 . . . . . . . . . . . The number and growth rate of Chinese students studying in U.K., Germany and France from 2011 to 2015 . . . . . . . . . The number and growth rate of Chinese students studying in Japan and South Korean from 2010 to 2015 . . . . . . . . . . . Comparison of Chinese undergraduate and postgraduate students studying in the U.S. from 2009 to 2016 . . . . . . . . . Distribution of young Chinese students to study high school abroad between 2007 and 2014 . . . . . . . . . . . . . . . . . . . . . . . Performance of Chinese Students in high school before going abroad . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Distribution of information-acquiring channels for Chinese undergraduate students in 2015 . . . . . . . . . . . . . . . . . . . . . . . Distribution of reasons for returning to China . . . . . . . . . . . . Overseas professional experience pyramid of returnees . . . . . Overseas professional experience pyramid of returnee with entrepreneurship experience . . . . . . . . . . . . . . . . . . . . . . . . . . Distribution of hindering factors for returning to China . . . . .

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List of Figures

3.5 3.6 3.7 3.8 3.9 3.10 3.11

Fig. 3.12 Fig. 3.13 Fig. 3.14 Fig. 3.15 Fig. 3.16 Fig. 3.17

Fig. 3.18 Fig. 4.1 Fig. 4.2 Fig. 4.3

Fig. 4.4 Fig. 4.5 Fig. 5.1 Fig. 5.2 Fig. 5.3

Ranking the importance of local preferential policies . . . . . . Location distribution of returnee entrepreneurial businesses. . Industry distribution of returnee entrepreneurial businesses . . Distribution of initial funding sources . . . . . . . . . . . . . . . . . . Composition of core management teams . . . . . . . . . . . . . . . . Resources entrepreneurial returnees obtained from abroad . . . Ratios of R&D cost to revenue in 2010 for returnee entrepreneurial firms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Location choices of salaried returnees . . . . . . . . . . . . . . . . . . Distribution of returnees by type of business and institution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Distribution of returnees’ employers by industry . . . . . . . . . . Distribution of salaried returnees’ occupational positions . . . Evaluation on business environment of the places where entrepreneurial returnees founded their firms . . . . . . . . . . . . . How much the entrepreneurial returnees demand policies of overseas entrepreneur park for Chinese scholars or talents special zone on a ladder scale . . . . . . . . . . . . . . . . . . . . . . . . Entrepreneurial returnees’ knowledge on different policies . . The number and annual growth rate of international students in China between 2010 and 2015 . . . . . . . . . . . . . . . . . . . . . Distributions of international students in China in 2015 . . . . The number and proportion of international students in China with Chinese government scholarship between 2010 and 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Process of foreign employment in China . . . . . . . . . . . . . . . . Comparison of the number of Sino-the U.S. overseas students . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The total number and growth rate of exit and entry people in China between 2008 and 2013 . . . . . . . . . . . . . . . . . . . . . The number and proportion of residents and aliens in China mainland between 2008 and 2013 . . . . . . . . . . . . . . . . . . . . . The number of people traveling to China between 2009 and 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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List of Tables

Table 1.1 Table 1.2 Table 2.1

Table 2.2 Table 2.3 Table 2.4 Table 2.5 Table 2.6 Table 2.7 Table 3.1 Table 3.2 Table 3.3 Table 4.1 Table 4.2 Table 5.1 Table 5.2

Major cities’ peak PM 2.5 values from December 16th to 18th 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The Henley & Partners visa restrictions index 2016—global travel freedom at a glance . . . . . . . . . . . . . . . . . . . . . . . . . . . The number of Chinese obtaining lawful permanent resident status by employment-based preferences in the U.S. between 2006 and 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The number of Chinese obtaining the three types of visas in the U.S. between 2008 and 2014 . . . . . . . . . . . . . . . . . . . . . . The number of Chinese immigrants in Canada between 1970 and 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The number of Chinese immigrants of skill stream in Australia between 2009 and 2015 . . . . . . . . . . . . . . . . . . . . . The number of overseas Chinese academicians in NAS and NAE of the U.S. by the end of 2013 . . . . . . . . . . . . . . . . . . . The number of Chinese students in major destinations in 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Distribution for Chinese students’ major in the U.S. from 2010 to 2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Factors affecting overseas Chinese’s decision of returning to China and their respective facets . . . . . . . . . . . . . . . . . . . . Factors hindering overseas Chinese from returning to China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Distribution of main initial funding sources . . . . . . . . . . . . . . Temporary workers and families residing in the U.S. between 2010 and 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Comparison of China’s outflow and inflow of labors stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . National-level talent policies in China . . . . . . . . . . . . . . . . . . Regional-level talent policies in China. . . . . . . . . . . . . . . . . .

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Introduction

Definition and Classification Drawing upon the International Organization for Migration (IOM), relevant experts and scholars on international migration, and our research on international migration, this book takes the position that international migration refers to the permanent departure from one’s home country or residing country to move to another country (Table 1).

Table 1 Classification of international migrants Classification Investment immigrants

Definition To invest a certain amount of money in the destination country or create businesses that provide locals with a certain number of job and investment opportunities, thus securing permission to immigrate to the destination country

Foreign Students

To apply as an international student for academic pursuits after being accepted by the appropriate teaching institution or organization in the destination country

Details Investment immigration generally includes five categories: financial, real estate, entrepreneurship, senior managerial, and business ownership immigration. In terms of operations, investment immigration is divided into three categories, short-term business visas, temporary investment immigration, and permanent immigration Generally divided into two categories: foreign students who get admitted into foreign secondary or post-secondary educational institutions to pursue further study; second is visiting scholars or trainees who go to other countries to acquire news skills or obtain training in schools or work environments (continued)

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Table 1 (continued) Classification Skilled immigrants

Definition To leave one’s home country or previous country of residency and travel across national borders, using their personal skills as the main tool for legitimately migrating to another country

Labor immigrants

To provide transnational production and service labor of all kinds and obtain a share of the proceeds generated by such labor

Illegal immigrants

To enter, illegally reside or illegally work in a country without permission, acting outside of the law

Details Skilled migration includes highly skilled migrants. These migrants move because they can obtain better development opportunities in the migration country versus their original country of residency. In addition, they can enjoy certain preferential treatment within specified time limits, change employers, and be reunited with family members already living abroad Compared with skilled migration, international labor refers to people with lower educational and skill levels who generally only engage in low-tech and low-end work and have short-term residence permits Includes illegal residents and workers

Source Li (2009)

Causes of International Migration First of all, income gaps have long been viewed as a primary cause of international migration (Rodriguez 1998). The development of the global economy and production systems widened the economic disparities between developed countries and developing countries, creating income gaps between them. In this view, people migrate to increase their economic well-being (Palát 2001). The recent development of advanced economies has been marked by the emergence of a dual labor market. It consists of a higher end and better paid labor market utilized by capital-intensive, highly efficient, and skill-intensive industries. This also includes a labor market for less skilled workers employed in tertiary industries and service activities such as cooking, cleaning, and the like. Since local residents are reluctant to take up work in the latter labor market, it must be filled by labor migrants. Immigration has become a structural necessity for the social and economic advancement of developing countries. Second, one of the basic characteristics of human history is the uneven social and cultural development of different countries. One key aspect of this process is the effort of people across borders to learn about each other’s cultures. In today’s world, culture has become a strategic resource and an important asset in human societal development. Thus, countries with flourishing traditional or dominant cultures are able to spread their culture worldwide. Cultural appeal is an important

Introduction

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cause of immigration (UNDP and UNESCO 2002). Western foreign students in China are a case in point: nearly 10% of them come to the country to study because they are obsessed with the mysterious Eastern culture (Wen 2007). Also, with the globalization of Western popular culture, Chinese students tend to study in Western countries to be familiar with the Western culture as a global citizen. Third, many less developed countries are latecomers to or have not even begun the process of democratization. The rule of law is weak and corruption flourishes, while the overall political environment is very harsh (Lim 2009). In general, people naturally try to protect themselves and their families from economic downturns and market instability. They also typically try to be well removed from political crises and other risks. When the government is unable to maintain order, people will choose to leave such environments out of concern for their personal safety and migrate to more secure countries as refugees. For example, in Africa, the Middle East, and central Asia, war and conflict have resulted in a large number of migrants escaping such trouble spots as refugees. Fourth, the unbalanced development of the world’s population and the aging population of developed countries are exacerbating the contradiction between the supply and demand for labor around the world. According to the current population growth rate, by 2050, the share of the global population living in less developed countries will continue rising, reaching 86.5%, while the share held by developed countries will fall to 13.5% (UN Department of Economic and Social Affairs 2007). This ongoing shift in global demography and consequences for the supply and demand for labor in advanced and developing countries gives rise to migration from the latter to the former countries. According to the International Labor Organization data, in 2005, the developed countries had already begun graying with respect to their age profile in the 1980s (Li 2011). Especially in developed countries like Japan and those in Western Europe, the aging population and negative population growth is starting to create labor shortages and is causing increased demand for labor migrants in such economies. Fifth, the recent past has seen the emergence of significant differences among countries with respect to ecological problems such as desertification, deforestation, soil erosion, and the like. As environmental problems mount in certain parts of the world, it becomes more difficult for local populations to survive, creating pressure for migration. Deterioration in the environment and natural disasters now ranks as an increasingly important cause of human international migration (UNDP and UNESCO 2002).

Globalization of Migration According to the United Nations international global migration statistics, by 2015, there were 244 million international migrants worldwide, accounting for 3.4% of the world’s population. Among them, 142 million were living in developed

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countries, accounting for 58% of all international migrants, while 102 million were living in the developing countries, accounting for 42% of the global total. Of the 183 million international immigrants, 75% are working-age immigrants aged from 20 to 64. In 2015, 90 million people born in developing countries migrated to other developing countries, while 85 million people born in developing countries migrated to developed countries. From the point of net immigrant population growth from 1990 to 2015, the U.S. underwent the largest net increase in immigrants, with about 23 million people in total, or a net gain of 0.9 million people per year on average. Coming in second was the United Arab Emirates, with a net immigrant population of 7 million people, while Germany placed third, with a net immigrant population of 6 million, Saudi Arabia and Spain both placed sixth with 5 million immigrant populations each (UN Department of Economic and Social Affairs 2016). The 2008 global economic crisis had a profound impact on migration flows. Between 1990 and 2015, the number of international migrants worldwide rose by over 91 million, or 60%. Much of this growth occurred between 2000 and 2010, when some 4.9 million migrants were added annually, compared to an average of 2 million from 1990 to 2000 and 4.4 million from 2010 to 2015. In Europe, the countries that were the hardest hit by the economic crisis, such as Greece and Spain, suffered from massive emigration. Conversely, countries doing much better economically such as Germany or Britain, attracted more and more immigrants. In 2015, Europe became the most popular destination for the world’s immigrants. Meanwhile, Asia’s international immigrants increased by 25.8 million people from 2000 to 2015, mainly due to a massive increase in demand for foreign workers from the emerging economies in West Asia and Southeast Asia, such as Malaysia, Singapore, and Thailand, etc. By 2015, overseas immigrants in Europe and Asia accounted for two-thirds of the world’s total immigrants, there were 76.1 million international immigrants living in Europe and 75.1 million living in Asia. Moreover, Asians have become the largest group of international migrants, with a total of 40 million of them living on other continents. Among them, 20.2 million live in Europe, 15.5 million in North America, and 3.0 million in Oceania. Those that were born in the corridor from Latin America and the Caribbean areas constitute the third largest group of international migrants in 2015, with most of them living in North America, which accounts for 25 million people (UN Department of Economic and Social Affairs 2016).

Immigration Bonus In the case of high immigration countries, migrants have made significant contributions to their economies. They bring their professional skills, capital, and human resources along with them, which helps to promote economic and social development in their destination countries. In November 2013, the U.S. Migration Policy

Introduction

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Institute held its annual meeting in London, with the theme “Cities and Regions: The Harvest of Local Immigrant Dividends”. The meeting opened up global discussion regarding “immigration bonuses” suggesting that the role of foreign immigrants in local areas of science and technology, economy, and society are gaining more and more attention. In recent years, immigration to the U.S., the U.K., and other immigrant nations have brought forth increasingly prominent economic contributions. Seventy-two immigrant scientists won Nobel Prizes for the U.S. between 1960 and 2013, making up roughly a quarter of the total number of American Nobel Prize winners. In terms of entrepreneurship, immigrants have created a quarter of the high-tech companies in the U.S. (White House Immigration Blueprint 2011). Likewise, immigrants from 155 countries have set up companies in Britain and the number of immigrant entrepreneurs in the country amounts to nearly 500,000. London alone boasts 190,000 immigrant entrepreneurs, much more than the amount in Birmingham (19,000) or Belfast (17,000). Because London contains the majority of immigrant entrepreneurs, it has benefited the most from them. The number of firms set up by immigrants in London amounts to 188,000, about 20 times that of Birmingham (China News Service 2014). According to statistics from the Singaporean Ministry of Trade and Industry, during the decade of the 1990s, the contributions made by foreign nationals to the Singapore GDP growth was 41%, and among them, 37% come from the professional and technical white-collar class (Wang 2009). Meanwhile, foreign students comprise a large proportion of “future immigrants” and they also bring significant “bonuses” to the receiving country’s economy, contributing significantly to their development and growth. According to the latest research of the Institute of International Education, in 2015, international students along with their families contributed USD $30.8 billion to the U.S. economy—a 41.3% increase from about USD $21.8 billion in 2012—which directly or indirectly created 370,000 new jobs and thus boosted overall employment in the U.S. by 14% (IIE 2015). Education also generated substantial economic benefits for Britain. According to a report by the Department for Business, Innovation & Skills (BIS), in 2012, the British overseas education industry generated £14.1 billion for the British economy and that income is expected to reach GBP £21.5 billion in 2020 and GBP £26.6 billion in 2025 (BIS 2011). In Australia, education had become the largest service trade industry in the world. The Australian Bureau of Statistics showed that international education activity arising from international students studying and living in Australia contributed AD $18.2 billion to the economy in 2014–2015. Especially in 2010, the Australian education service trade income was AD $16.3 billion, exceeding the value of the exports of the country’s long-standing trade stalwart, the wool industry (Department of Education and Training 2015).

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New Immigration Trends The report Policies to Support Immigrant Entrepreneurship issued by U.S. Migration Policy Institute (MPI) shows that compared with local natives, new immigrants tend not only to be more entrepreneurial, but they also quickly acquire and develop skills in this area, although new immigrants normally face more obstacles in becoming entrepreneurs than the native-born population (MPI 2014). The report pointed out that policymakers in many countries around the world now increasingly recognize that supporting immigrant entrepreneurs can bring higher returns to the economy. At the same time, countries that favor “entrepreneurial immigrants” have introduced measures to encourage the foreign population in their countries to create business start-ups. In April 2013, the Canadian Immigration joined together with venture capital firms to issue the business Visa (Start-Up Visa) program to encourage people to invest in Canada and set up new businesses. In 2014, the Canadian government canceled the investment immigration policy, with the aim of attracting more “entrepreneurial immigrants”. At the same time, through an analysis of Canadian immigration policies, by attracting skilled migrants and investment immigration to business immigration, we can see that the government is paying more and more attention to the economic vitality and job opportunities that business migrants bring forth. In November 2013, the U.S. Citizenship and Immigration Services launched the Entrepreneurs in Residence (EIR) plan and set up a special website, to provide a one-stop service for business immigrants (U.S. Citizenship and Immigration Services 2013). This website aims to familiarize immigrants with immigration applications and procedures as well as helping them understand obstacles of entrepreneurship and its guiding principles. According to survey data from 2006 to 2013, the sales volume of science and technological companies founded by foreign immigrant entrepreneurs reached USD $63 billion in the U.S., while employing 560,000 people (People’s Daily 2013). In Japan, the government is also setting up new windows for the “national strategic district” which is aimed at helping immigrant entrepreneurs settle various kinds of formalities and solve all related problems to facilitate business immigration. At the same time, the Japanese government also cut the time for immigration clearance from 2–3 weeks to 1 week, while providing specialized services in English to help the entrepreneurs from around the world set up businesses in Japan and reduce communication barriers. The government also plans to set up an “Innovation Promotion One-stop Service Center” in Tokyo circle, circle of Kansai, and Fukuoka city to create all sorts of convenient conditions for the immigrant entrepreneurs (Kingston 2013).

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Immigrants Integration The percentage of immigrants in most developed countries now is over 10% (Table 2). The role of immigrants in the host countries is increasingly valued, thus integration problems “after the age of immigration” have become the focus problem of countries with a large percentage of immigrants, such as the U.S., Singapore, France, and Germany. Ever since Germany introduced foreign workers in the 1950s, for instance, the integration of immigrants has been an ongoing problem for German society. During the 1970s–1980s, the German government was not fully aware of the integration problem. At that time, it mistakenly believed that the immigrants would eventually return to their country of origin years later. Thus, the German governmental authorities did not consider allowing children of immigrants and local residents to learn and live together. This inaction with respect to integrating immigrants has led to many problems. According to a report issued by the Berlin Institute for Population and Development, the unemployment rate of the Turkish immigrants and people with a Turkish background is 16% (the youth unemployment rate is 19%). These individuals also have the lowest integration rate in Germany. The first generation of Turkish immigrants has low levels of education, which leads to lower economic status. The educational levels attained by immigrant children are also poor. Most Turkish people believe that life in Germany is good, but also feel that they are not recognized by society (People’s Daily 2014). Therefore, the government must face up to the problem of how to maintain social justice to avoid social differentiation.

Table 2 Amount and proportion of immigrants in the main countries and regions in 2015 Countries or regions The U.S. Germany Russia The U.K. Canada France

Amount of immigrants 4662.71 1200.57 1164.33 854.31 783.55 778.44

Proportion 14 15 8 13 22 12

Australia

676.37

28

Countries or regions India Hong Kong Singapore Switzerland Japan South Korea New Zealand China Brazil

Amount of immigrants 524.10 283.87 254.36 243.87 204.39 132.73

Proportion 0 39 45 29 2 3

103.97

23

Spain 585.30 13 97.80 0 Italy 578.89 10 71.36 0 Unit: 10 thousand people, % Source International Migration Report 2015, UN Department of Economic and Social Affairs (2016)

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In April 2009, Singapore established the National Integration Council to promote social integration among Singaporeans, new immigrants, and foreigners. Singapore’s approach to integration does not demand that new immigrants abandon their own beliefs and culture. Rather, they expect the new immigrants to share commonalities, values, and experiences with fellow Singaporeans so that they can all work together to achieve their aspirations and build the best home for themselves and their children (National Integration Council 2010). In February 2014, France government set up “the inter-ministerial representative” position to be responsible for the execution of the coordination measures among the Ministry of the Interior, the Ministry of Education, the Ministry of Employment, and other departments (Xinhua News 2014). In July 2016, the Prime Minister Didier Leschi of the Office France of Immigration and Integration (OFII) proposed the new “Contract of Integration Republic (CIR)” instead of the too standardized “Contract of Reception and Integration (CAI)”, which were both intended to help the lawful immigrants learn French and prevent discrimination against them by employers (China.com.cn 2016). In 2014, some universities in the U.S. introduced Chinese students to the “Immigration Bridge Program”, in order to help Chinese students to quickly integrate into American society and acquire employment after graduation. For example, Indiana University’s Kelley School of Business joined together with businesses and law firms to help students solve the problem of getting H1-B visas (Indiana University’s Kelley School of Business 2017). Michigan State University (MSU) sent their school chefs to China to study Chinese food preparation so that authentic Chinese dishes could be served in university cafeterias (MSU 2017), while the University of Michigan (UMich) even launched its own Chinese website (UMich 2017). In Berlin, Germany, residents with a migration background make up more than 28.4% of the total population. Since 2006, the share of people in Berlin from a migrant background accepting vocational training in the field of public service, increased from 8.7 to 18.8%. The proportion in the public sector increased from 13.3% in 2010 to 22.6% in 2013. Among the Berlin state recruited professional trainees, the proportion is 25.4% (Chinese Social Sciences Net 2014). In December 2010, the Berlin State Government introduced the integration law, the first measure of its kind in Germany to promote the integration of the federal state and provide a legal basis for immigrants to participate in social affairs (People’s Daily 2014). The German government’s measures will help foreign immigrants to integrate into the local environment and realize their self-worth. To a certain extent, these measures also helped ease the pressure from the shortage of the local labor market.

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International Migration of China In the last 30 years, the volume, complexity, and the types of migrants have changed considerably in China. Currently, the so-called “third wave of migration” after the implementation of “Reform and Opening Up” policies, has been accelerating. The proportion of Chinese with high net worth who have already emigrated to foreign countries, are applying to do so, or are considering such a move now stands at 64% (Hurun Research Institute 2015). Thus, emigration has become an important issue in Chinese society today. Meanwhile, as the Chinese economy and society continue developing, increasing numbers of foreigners are being attracted to the country. Currently there are three main groups of foreigners in China: international students, tourists, and foreign skilled workers. The development of these groups are closely related to the rapid economic and social development in China. The possible influence from foreign migrants in supporting development in China domestically and internationally should also be recognized. However, compared with the percentage of similar groups within many other countries, the percentages of international students, tourists, and foreign skilled migrants in China are much lower. In order to further benefit from the positive influence of international migration in China, immigration policies require further reform. In addition to attracting regular immigrants, the rising economy in China is also attracting large numbers of irregular immigrants into the country. Further, there is evidence from official sources which suggest irregular immigrants are contributing to increased criminal activity in China. Therefore, while it is important to promote regular international immigration to China, policies for tackling irregular immigration to the country also require further regulatory support. In sum, Chinese international migration forms an integral part of global migration flows, and international competition for talent (Wang 2010). In order to have a detailed understanding of the situation of Chinese migrants, we must first grasp global migration as a whole. This book will explore the new changes and trends of Chinese international migration, within the larger context of worldwide migration and globalization.

References Australian Government Department of Education and Training (2015) Export income to Australia from international education activity in 2014–15, Nov. Available at: https://international education.gov.au/research/Research-Snapshots/Documents/Export%20Income%20FY2014-5. pdf China News Service (2014) Migration enterprises accounted for 1/7 of the British companies—a big contribution to the U.K. economy 6 March. Available at: http://www.chinanews.com/hr/ 2014/03-06/5916832.shtml

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China.com.cn (2016) France provides French training to lawful immigrants for helping foreigners in France, 7 July. Available at: http://news.china.com.cn/live/2016-07/07/content_36442185. htm Chinese Social Sciences Net (2014) Germany adopted a new immigration policy to avoid the social stratum differentiation, 4 Aug. Available at: http://www.cssn.cn/shx/shx_ywy/201408/ t20140804_1277911.shtml Department for Business, Innovation & Skills (BIS) (2011) Estimating the value to the U.K. of education exports. Available at: http://www.bis.gov.uk/assets/biscore/higher-education/docs/e/ 11-980-estimating-value-of-education-exports.pdf Held D (2001) Global transformations: politics, economics and culture, Social Sciences Academic Press (China) Hurun Research Institute (2015) Hurun wealth report 2014—Soul investment white paper for Chinese high net worth population, May. Available at: http://www.hurun.net/en/ArticleShow. aspx?nid=4558 Indiana University’s Kelley School of Business (2017) Graduate career services—immigration bridge program. Available at: https://kelley.iu.edu/GCS/page42033.html Institute of International Education (IIE) (2015) Open doors 2015: report on international educational exchange. Available at: http://www.iie.org/Research-and-Publications/Publications-andReports/IIE-Bookstore/Open-Doors-2015/#.WNyzjbF8Ocs Kingston J (2013) Immigration reform: could this be Abe’s new growth strategy? Available at: http://www.japantimes.co.jp/opinion/2013/05/19/commentary/immigration-reform-could-thisbe-abes-new-growth-strategy/#.VZZcTHzWLDx Li MH (2009) The definition and types of international migrants with a special reference to the Chinese migrants. Overseas Chinese History Studies 2:1–10 Li MH (2011) Population ecology, population policy and international immigrants—2007 United Nations world population policy. Southeast Academic Research 1:4–12 Lim H (2009) Democratization and the transformation process in East Asian Development States: Focus on financial reform in Korea and Taiwan. Available at: http://www.brookings.edu/ research/papers/2009/03/democratization-transformation-lim Michigan State University (MSU) (2017) Office of China programs—international studies and programs. Available at: http://china.isp.msu.edu/news/ National Integration Council (2010) Available at: https://www.nationalintegrationcouncil.org.sg/ Palát M (2001) Economic causes and consequences of international migration of labor. Estonian Economic Policy 19(2):121–137. People’s Daily (2013) New tactics for the immigration policy: Opportunity or challenge? 10 April. Available at: http://edu.people.com.cn/n/2013/0410/c204387-21077594.html People’s Daily (2014) Promote integration, German immigration policy is difficult to advance. 30 June. Available at: http://cpc.people.com.cn/n/2014/0630/c83083-25217623.html Rodriguez ER (1998) International migration and income distribution in the Philippines: economic development and cultural change. University of Chicago Press 46(2):329–350 United Nations Development Programme (UNDP) and United Nations Educational, Scientific, and Cultural Organization (UNESCO) (2002) Cultural diversity and biodiversity for sustainable development. Available at: http://www.unep.org/civil-society/Portals/24105/documents/ publications/Cultural_Diversity_and_Biodiversity_part%201.pdf United Nations Department of Economic and Social Affairs (Population Division) (2007) World Population Prospects 2006 Vol II (XXVI) United Nations Department of Economic and Social Affairs (2016) International Migration Report 2015, Sept. Available at: http://www.un.org/en/development/desa/population/migration/ publications/migrationreport/docs/MigrationReport2015.pdf University of Michigan (UMich) (2017) Available at: http://ns.umich.edu/new/chinese/ U.S. Citizenship and Immigration Services (2013) Nov. Available at: https://www.uscis.gov/eir

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U.S. Migration Policy Institute (MPI) (2014) Policies to Support Immigrant Entrepreneurship Aug. Available at: http://www.migrationpolicy.org/research/policies-support-immigrantentrepreneurship Wang HY (2009) Talent war China. CITIC Press Wang HY (2010) The national strategy: talent changes the world. China and international think-tank. People’s Publishing House Wen F (2007). The adaptation of cultural diversity: investigation and analysis of foreign students in China. South East Asian Studies 6:86–89 White House Immigration Blueprint (2011) Building a 21st century immigration system. Available at: https://www.whitehouse.gov/sites/default/files/rss_viewer/immigration_blueprint.pdf Xinhua News (2014) French funding to help new immigrants learn French for promoting new immigration policy and immigrants integration, 12 Feb. Available at: http://news.xinhuanet. com/world/2014-02/12/c_126122912.htm

Chapter 1

In the Era of Globalization: The Phenomenon of International Migration in China

1.1

Introduction: Chinese International Migration

Since the two world wars, Chinese international migrants have been playing an increasingly crucial role in the global community. After the Economic Reform 1979, the number of Chinese migrating abroad has been rapidly increasing, and the reasons for migration are becoming increasingly diverse. The population of Chinese students migrating abroad has been increasing since data became available since the late 1990s, and they have evolved to become the largest population of Chinese migrating abroad in recent years. Currently, there are more than 60 million ethnic Chinese are living abroad, the scale of which has made the Chinese the largest overseas migration community (Wang et al. 2015). Therefore, this chapter focuses on the wave of international migration from China, with special attention paid to the post-reform period.

1.2

Causes of Chinese International Migration

The growth seen in the number of Chinese overseas international migrants is primarily caused by the following factors: an economic development gap and economic disparities, social security, food safety, education, environmental issues, the political and legal environment, and the impact of globalization. By understanding the purpose of Chinese migrating abroad, this section provides insights to understanding the behavior of Chinese migrating abroad.

© Springer Nature Singapore Pte Ltd. 2017 L. Miao and H. Wang, International Migration of China, DOI 10.1007/978-981-10-6074-8_1

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1 In the Era of Globalization …

2

1.2.1

Economic Development Gap and Income Disparities

Migration happens when the benefits of migrating exceed the costs of doing so. Similar to other international migrants, better job opportunities and higher incomes are the most essential driving forces causing Chinese nationals to migrate to foreign countries. The Chinese economy has been rapidly developing since the Economic Reform begun in 1979, however it should be recognized that income per capita in China well behind more developed economies such as the U.S. According to the World Development Index (WDI) data from the World Bank, China is classed as a middle-income country, with respect to its Gross Domestic Product (GDP) per capita, despite China also ranking as the second largest economy globally by GDP. WDI data from 2015 showed China’s Gross National Income (GNI) per capita was USD $7930, which is less than the world average of USD $10,548, and ranks China number 108 out of 179 world economies (The World Bank 2015).

1.2.2

Social Security

In 2008, the Chinese government’s public service charges on education, medical care, and social security amounted to 28.9% of total government expenditure. This is significant as compared with other countries whose per capita GDPs are below USD $3000, or between USD $3000 and USD $5000, the Chinese government total spending was 25% less (Ru et al. 2012). Social security, such as pensions and welfare payments, accounted for just 2.83% of the Chinese Central Government’s fiscal expenditure in 2015. In comparison, the figure is 30.58% for the U.S., 45.37% for Canada, and 54.03% for Germany (National Bureau of Statistics of the P.R. China 2015). While in the past three decades China’s social security support system has greatly improved, it still lags considerably behind that of developed countries. Generally, Chinese social security has low overall planning, and the country has yet to progress to an inclusive welfare system. This is relative to the social welfare systems in developed countries, which are much more inclusive and highly established. In France, for example, people receive more than 400 different forms of welfare benefits from the government (Sohu.com 2015). In addition to a weak welfare safety net, Chinese people now face rising prices for consumer goods and inflated housing costs. Above all, these social security issues can be detrimental to the standard of living for many.

1.2.3

Educational Resources

Seeking richer educational resources for the next generation is the top consideration for investment immigration (Fig. 1.1). According to the “World Reputation

1.2 Causes of Chinese International Migration Fig. 1.1 An investigation on the reasons for high-net-worth individuals (HNWIs) investor migrants in mainland China. Source China Merchants Bank (CMB) and Bain & Company, 2011 China Private Wealth Report, 2011

3

To facilitate their children's education

58

To protect the wealth security

43

To prepare for future pension

32

Overseas investment and business…

16

Easy to travel overseas

7

To have children

6

Lower tax rate

6 0

10

20

30

40

50

60

70

Rankings 2014”, from the “Times Supplement on Higher Education”, within the top-200 universities worldwide, 74 were in the U.S., 31 in U.K., and 7 in Australia. Just 3 were in China which as a populous country with more intense competition (The Times 2014). The high quality of postsecondary education in these Western countries can be a pulling factor of Chinese migration. The 2011 China Private Wealth Report, jointly published by China Merchants Bank (CMB) and Bain & Company, concluded that the most popular reason for emigration (more than 80%) reported by the Mainland Chinese was to improve their children’s education (China Business Press Release Newswire 2010). The education system in China has been very examination-oriented, which tends to inhibit students’ critical thinking skills and creative imagination. Such a education style has triggered general concerns among the educated population in China. The system has been criticized for producing “professional” exam-takers who may lack individual creative thinking and problem-solving skills. Compared to the domestic education in China, countries like Canada, the U.S. and the U.K. not only invest more resources into education, but also develop teaching styles and curriculum to encourage independent thinking and personal development. The following 2013 China Private Wealth Report, saw an increase since 2011 of roughly 10% of respondents who said that while they themselves have no plans to emigrate, they are considering emigration applications for their children. This increase from the 2011 China Private Wealth Report highlights a continued and growing trend of families sending Chinese students to study overseas. With regard to the 2011 and 2013 reports, we can understand the main reason for Chinese independent child migration would be for educational purposes. A survey from New Fortune also found the top motivation driving Chinese emigration is the concern for children’s education, with 76.7% of respondents selecting that answer. The 2013 China Private Wealth Report goes further by explaining the means by which many Chinese migrants seek overseas migration for their families. It found that about 60% of High-Net-Worth Individuals (HNWIs) indicated that they either considered or had completed investment migration. These wealthy individuals, through their participation in investor immigration programs, gain access to foreign education systems for their children.

1 In the Era of Globalization …

4

1.2.4

Environmental Issues

Due to the rapid rate of industrialization in China, environmental issues, such as poor air quality, have become a major health concern for most of the urban residents, which has then functioned as a newly emerged driving force for emigration. In January 2013, Beijing had 29 days when the particulate matter (PM 2.5) in the air exceeded, often by substantial margins, World Health Organization (WHO) recommendations. On January 12th 2013, the PM 2.5 reached such high levels it received worldwide media attention, from both the BBC and CNN. Additionally, a Financial Times story titled “Pollution of Beijing Drives Foreigners Away,” noted that Beijing’s air pollution was not only pushing people away from visiting Beijing, but also making it more difficult for Chinese and foreign firms to hire international talent (Financial Times 2013). Other major Chinese cities like Guangzhou, Shanghai and Shenzhen, face similar problems. According to the related environmental studies on air quality, which have taken random samples of PM 2.5 in major global cities, the maximum PM 2.5 values in major cities in the U.S., the U.K. and Japan are in fact lower than values found in major cities in China. Table 1.1 provides a simple comparison of the air quality between Chinese cities and foreign cities based on the data collected by Air Quality Index China (AQICN). These numbers are composed by the official data released by embassies, consulates, national weather station, and environmental protection agencies. For example, the maximum recorded concentration of PM 2.5 of 468 in Harbin is almost 17 times the same measurement in Sydney, which scored a maximum of just 28. The desire for better air quality is an important factor in understanding why Chinese people are emigrating to countries like the U.S. or Australia, as the air is cleaner. This is especially true within affluent and middle-class Chinese migrants, as it has been suggested by the joint survey done by the Insight China Magazine and Tsinghua Media Survey Lab, medical care and protection is one of their top three concerns. This is important as poor air quality directly challenges personal wellbeing and health.

Table 1.1 Major cities’ peak PM 2.5 values from December 16th to 18th 2013 Major global cities

Peak PM 2.5 value

New York 161 Los Angles 95 Ottawa 102 Toronto 93 Sydney 28 London 104 Paris 50 Tokyo 82 Source AQICN (2013)

Major Chinese cities

Peak PM 2.5 value

Beijing Tianjin Shanghai Chongqing Guangzhou Chengdu Shenzhen Harbin

360 360 184 189 191 259 222 468

1.2 Causes of Chinese International Migration

1.2.5

5

The Political and Legal Environment—The Concept of Freedom

The freedom of leaving or entering a country is also a concern which triggers many Chinese migrating to other countries. The Chinese nationality can rarely get its citizens exempted from the visa applications when they are travelling to developed economies, which are the main destinations for private business investors and tourists. This situation motivates some of the Chinese who travel very frequently to migrate in order to increase their ease of movement. The Henley & Partners Visa Restrictions Index is a global ranking of countries according to the travel freedom their citizens enjoy. In the Henley & Partners Visa Restrictions Index 2014, China received a score of 45, ranking it 83rd out of 219 countries. However, the most recent the Henley & Partners Visa Restrictions Index 2016 highlights a welcome relaxation (Henley & Partners 2016), China received a score of 50, ranking it 87th out of 219 countries this year (Table 1.2). This is significant as it indicates that the Chinese government is adaptive, challenging the concerns of Chinese people and their motives for migration. The improvement seen in the Henley & Partners Visa Restrictions Index 2016 is also encouraging as it shows the Chinese passport is gradually becoming less restrictive. This may serve to decrease the attractiveness of overseas passports, and subsequent Chinese international migration in the future. Meanwhile, it is still Table 1.2 The Henley & Partners visa restrictions index 2016—global travel freedom at a glance Rank

Citizenship/Passport

1 Germany 2 Sweden 3 Finland, France, Italy, Spain, The U.K. 4 Belgium, Denmark, The Netherlands, The U.S. 5 Austria, Japan, Singapore … … 20 Hong Kong China 21 Brazil, Bulgaria, Romania … … 29 Uruguay, Taiwan China … … 40 Macao China … … 48 Russian Federation … … 85 India, Mali, Uzbekistan 86 Bhutan, Guinea-Bissau, Mozambique, Sierra Leone 87 Cambodia, China Mainland Source Henley & Partners (2016)

Score 177 176 175 174 173 … 154 153 … 137 … 120 … 105 … 52 51 50

1 In the Era of Globalization …

6

worth noting that the current ranking will not provide enough conveniences for Chinese citizens to travel abroad as they are actively engaged in overseas business activities and cultural/academic communications. This hurdle in becoming globally mobile stirred a wide interest in migrating to the other countries where they can have greater ease of movement.

1.3

Current Situation of Chinese International Migration

The population of Chinese migrants is wide-spread internationally, that Chinese migrants can be found in all seven continents. Together with the rapid economic development in China as well as the increasing number of middle income families, the destinations for Chinese migrants are becoming increasing diverse. Other than developed economies such as the U.S., Australia, Singapore and Europe, Chinese migrants can also be found in developing economies such as Latin American countries and African countries. This section provides an overview of Chinese international migrants in five major destinations, the U.S., U.K., Australia and New Zealand, Japan and Africa.

1.3.1

Chinese Migrants in the U.S.

The U.S. has been the top destination for Chinese international migrants, for both economic migrants and students, according to 2014 Yearbook of Immigration Statistics and 2016 Open Doors Report, about 765,954 Chinese migrants obtained permanent residence between 2005 and 2014 (U.S. Department of Homeland Security 2016) and 334,028 Chinese students were studying there in 2016 (IIE 2016). This was nearly double the population of Chinese students in Australia, which has the second largest population of Chinese students. Despite increasing numbers of Chinese migrants internationally, there are signs of a slow down on the population of Chinese migrants in the U.S. since 2011. According to 2014 Yearbook of Immigration Statistics, the total number of Chinese migrants to the U.S. decreased from 87,016 in 2011 to 81,784 in 2012, then down to 71,798 in 2013, but followed by an increase to 76,089 in 2014 (U.S. Department of Homeland Security 2016). This trend shows a decrease of 17.5% between 2011 and 2013. Despite such decline, the population of Chinese migrants in the U.S. still stood as the second largest population of permanent residence in the U.S., after Mexican migrants. In 2014, Obama outlined the new requirements on his first day at the CEO Summit of the Asia Pacific Economic Cooperation (APEC) Meeting in China. “Short-term business and tourist visas will be increased from one year to 10 years, and student and exchange visas will now be valid for five years, also up from one year.” The White House said the new rules “will improve trade, investment and

1.3 Current Situation of Chinese International Migration

7

business ties by facilitating travel and offering easier access to both economies” (U.S. News 2014). Therefore, the number of Chinese migrants has had a slight increase of 6% in 2014. According to official data, a total of 1,016,518 Permanent Residence (PR) permits were issued in 2014. While Mexican migrants had the largest proportion of PR granted, PRs issued to Chinese are the second largest at 7.5% (U.S. Department of Homeland Security 2016). As it is one of the most recent developments on Chinese international migration, there has been relatively little research done on this downward trend, possibly due to how it rebounded slightly in 2014. One of the possible reasons for this decrease in Chinese migrants to the U.S. might be related to the increasing numbers of middle class families in China, consequently the choices of migration destinations for Chinese migrants are becoming increasingly diversified.

1.3.2

Chinese Migrants in European Union (EU) Member Countries

Europe has become an attractive destination for Chinese international migrants. Estimates from 2013 put the number of Chinese international migrants in Europe between 3 million and 3.6 million, and the top destination choices for Chinese migrants tend to be the U.K., Germany, France, Italy, Netherlands and Spain (Wang 2014). Compared to other EU member countries, Chinese migrants, especially students, favor migrating to the U.K. In 2015, 89,540 international students came from Mainland China, while 16,215 international students come from China Hong Kong, two of the major populations of international students in U.K. (Wang and Miao 2016). Looking at Chinese international immigrants in Britain helps us to understand the scale of this movement. For example, China surpassed India to become Britain’s biggest source of non-EU immigration in 2012. Furthermore, in the same year, about 40,000 Chinese migrants were moving to, or already living in the U.K., accounting for 8.7% of total migration to the U.K. By 2013, China solidified itself as the top non-EU source country of immigrants to the U.K., contributing 46,000 migrants, or 9% of the total migration to the U.K. According to data from the U.K.’s Office for National Statistics (ONS), in 2013, there was over 600,000 Chinese passport holders residing there. Britain has been a popular destination for Chinese migrants for many years, and can further be seen by the number of Chinese who have naturalized in the U.K. Over the past decade, 45,000 newly naturalized citizens in the U.K. were of Chinese nationality, making them the 5th largest group out of all newly naturalized British citizens (Chinanews.com 2013). In recent years, other European countries, such as Germany, Italy and the Netherlands, have begun to gain popularity as destinations for Chinese international migrants. In Germany, 87,862 Chinese immigrants were residing in the country by 2012, a 21% increase from the previous year (Chinanews.com 2012). In 2013, there

1 In the Era of Globalization …

8

were nearly 101,030 Chinese nationals working or studying in Germany (Statistisches Bundesamt (Destatis) 2015). Furthermore, by 2014, Chinese international migration as well as statistics from the report Non-EU Citizens Holding a Residence Visa showed that over 320,794 Chinese passport holders resided in Italy (ISTAT 2014). In the same year, there were 85,313 Chinese migrants in the Netherlands, of which 64,097 were from mainland China, an increase of 173% since 1996 (Statistics Netherlands 2014). These statistics show that the destinations of international migration for Chinese migrants are becoming increasingly diverse. Further, such diversity is presenting new opportunities for increased cooperation between China and European countries in the future.

1.3.3

Chinese Migrants in Australia and New Zealand

Over the past decade, Chinese migration to Australia has been increasing considerably. China is now Australia’s largest source of investor migrants, business communications migrants, international students, and international tourists. In the 2013–2014 period, Australia issued a total of 190,000 permanent residence visas, of which 27,334 were issued to Chinese migrants, accounting for 14.4% of the total; the number of Chinese migrants to Australia has increased by 7.2% over the last year (Australian Government-Department of Immigration and Border Protection 2014). The situation in New Zealand is not as positive, with an unsteady trend of Chinese migrants into the county. However, while the migration pattern has not been linear, Chinese migrants account for 3.4% of the total population of New Zealand (Li 2011). According to the data from New Zealand Ministry of Commerce, Fig. 1.2 highlights the fluctuating number of Chinese migrants who obtained permanent residence visas. The number of Chinese migrants obtaining permanent residence visas in New Zealand peaked in the 2011–2012 period. However, the number fell significantly by over 57% between 2013 and 2014, to just 3687 visas obtained. In period from 2008 to 2014, a total 40,888 Chinese migrants 10,000

(Chinese permanent holders)

Fig. 1.2 The number of Chinese migrants in New Zealand between 2009 and 2014. Source Ministry of Commerce, New Zealand, 2014

9,000 8,000

8,740 7,803

7,000

6,817 7,117

6,000

6,724

5,000 4,000 3,687

3,000 2,000 1,000 0

2009

2010

2011

2012

(Year)

2013

2014

1.3 Current Situation of Chinese International Migration

9

obtained permanent residence visas and 16,119 of these were obtained through a business or skilled visa. The popularity of business and skilled visas accounted for about 39.4% of the total.

1.3.4

Chinese Migrants in Japan

According to estimates by Zhuang (2009), Southeast Asia boasts the biggest regional concentration of Chinese international migrants, accounting for 73.5% of the total number of overseas Chinese. Indonesia, Malaysia, Singapore and Philippines are the top four destination countries for Chinese international migrants, within the Southeast Asian region. However, possibly also influenced by the rapid economic development in China, the numbers of Asian destinations for Chinese migrants are expanding to the rest of Asia. For example, Japan and Korea are two of the recent popular destinations in Asia for Chinese migrants. Considering the population of Chinese migrants is currently the major proportion of international migrants in Japan, Chinese migrants in Japan are discussed in this part as an example of Chinese migrants in contemporary Asian countries. In the broader region of Asia, Japan is one of the highest receiving countries of Chinese immigrants. White Book of Immigration Management 2014 showed that Chinese migrants account for 40% of the total number of foreign nationals entering the country. In 2013, 983,268 Chinese nationals migrated to Japan, of which 24,583 were students. This highlights that Chinese students make up a sizable 35.1% of the total migrants in Japan. Interestingly, this was 1971 fewer students than in 2012. Furthermore, the total number of Chinese immigrants to Japan in 2013 was 0.5% lower compared to that of 2012, its lowest level since 2009. However, in 2013, more Chinese obtained permanent resident status in Japan than the previous year, with a total of 204,927 visas issued showing an increase of 12,969 from 2012 (Immigration Bureau of Japan 2014).

1.3.5

Chinese Migrants in Africa

Business cooperation between China and African countries has been on the increase, especially since early 2000. African countries have become major trade partners of China since that time. In 2014, the volume of China-Africa trade amounted to USD $220 billion, which was 22 times what it was in 2000 when Forum on China-Africa Cooperation (FOCAC) launched in Beijing, and the proportion of Africa’s total foreign trade volume with China has increased from 3.82 to 20.5%. Under the influence of such increasing business cooperation between China and African countries, increasing numbers of Chinese are migrating to Africa. Annual Report on Overseas Chinese Study (2016) showed that the number of Chinese migrants in Africa ranged between 136,000 in 1996 to 1,100,000 in 2012,

10

1 In the Era of Globalization …

an increase of more than 7 times in less than 20 years (Jia 2017). Meanwhile, Chinese migrants in African countries often fall under categories of business investors, skilled workers and contract workers. It should be recognized that the growing numbers of trade deals between China and African countries are the main drivers for the increasing presence of Chinese migrants in African countries. As the numbers of trade deals and infrastructural projects between China and African countries are on the increase, the presence of Chinese migrants in African countries is going to continue growing. On the other hand, it should also be recognized that compared to the percentages of Chinese migrants in Japan and the U.S., those in African countries is much smaller. For example, according to the government documents of the Ministry of Public Security of the People’s Republic of China and Overseas Chinese Affairs Office of the State Council (2011), just 0.7% of Nigeria’s population was Chinese, and Namibia was one of the few African countries to have over 2% of its population made up by Chinese immigrants. With the ever increasing economic investment and coordination between the Chinese government and African governments, one would expect the proportion of Chinese international migrants to be larger. However, it is likely that visa requirements and mismanagement has prevented mass accessibility for Chinese international migrants wishing to invest or work within the continent.

1.4

Characteristics and Trends of Chinese International Migration

Influenced by factors like the domestic economy, environmental problems, and educational shortcomings in China, some Chinese people are pushed to migrate. It is important to understand the characteristics of these migrants, why they are pushed to migrate, and the current trends within Chinese international migration. The characteristics of the modern day Chinese international migrant might include, for example, affluence, and higher education. In terms of trends we look at “new migrants” increasingly diverse movements and the “migration deficit” that has accelerated in China in recent years. The patterns of migration in and out of China have evolved continuously since the period of Reform and Opening-up. The most recent wave of Chinese migrants is generally referred to as the “new migrants,” and most of them are from relatively affluent and privileged backgrounds. The emergence of these new migrants has broadened the worldwide geographical distribution of overseas Chinese. It has done so by altering the older pattern of Chinese migration, in which such migrants were concentrated solely in Southeast Asia. These new migrants travel further abroad and assimilate with societies that are dissimilar to Asian cultures. It is estimated that the total number of these new migrants has reached 10 million, accounting for 1/6 of the overall 60 million overseas Chinese (Zhuang and Zhang 2012). Conversely,

1.4 Characteristics and Trends of Chinese International Migration Stock of Immigrants Moving In

Stock of Immigrants Moving Out 947.2485 876.3613

1,000 900 800

(Thousands)

Fig. 1.3 China’s migration deficit between 1990 and 2013. Source UN Department of Economic and Social Affairs (2013)

11

700 549.3899

600 500

408.5951

400 300 200 100 37.6361 0

1990

50.8034

75.7108

2000

2010

84.8511 2013

(Years)

according to the statistics from China’s Sixth National Census, just 593,832 foreigners are living in China (National Bureau of Statistics of the P.R. China 2010). Therefore, the inflow of migrants into China is 16% less than the outflow of Mainland Chinese emigrants. The UN Department of Economic and Social Affairs data points out that the number of immigrants in China has always been extremely low. Looking at the UN data from 1990 for comparison, there were 40.86 million Chinese migrants living abroad, yet only 377,000 foreigners living in China. Thus, in 1990 there was a “migration deficit” of around 37 million people. Looking at the data from 2000 to 2010 (Fig. 1.3), it can be seen that China’s “migration deficit” has increased. Though the stock of immigrants is increasing gradually, it still remained far lower than that of emigrants. In 2013, China’s “migration deficit” stood at about 8.494 million. Despite the rapid economic development in recent decades, and the increasingly active engagement in global activities of China, Fig. 1.3 showed that the migration deficit has been on the increase from 1990 to 2013. This also means that China is facing an increasing shortage of highly-skilled talents in the domestic labor market. While educated Chinese migrants are making a stronger presence of China internationally, the domestic shortage of skilled labor could also influence the strategic reform of the industrial structure upgrade. Such a migration deficit is therefore creating a paradox for development in China domestically and internationally. One of the key problems remains that China issues far less permanent resident visas than other countries. This makes it less accessible and attractive to foreign migrants. For instance, over the past few years, about 150,000 Chinese migrants have obtained permanent resident visas in the U.S., Canada, Australia and New Zealand annually (Wang 2014). On the other hand, China issues only a few hundred permanent resident visas to foreign migrants each year. While in 2012, China issued the most “green cards” ever, it is still far too little to balance the deficit. The deficit is problematic, and can be seen reflected in key areas like labor and education. In terms of labor, in 2012, 850,000 Chinese people were working in foreign countries, yet only about 200,000 foreigners held jobs in China (Wang 2014).

1 In the Era of Globalization …

12

1.5

Concluding Remarks

In conclusion, Chinese international migration is experiencing an overall increase over the past several decades. The rapid economic development in China is leading to diverse destinations for Chinese migrants internationally. Further, increasing engagement of China in the global economy, and non-traditional destinations for Chinese migrants are attracting international migration from China. The rapid economic development and increasing international influence from China is also altering factors which determine the migration decisions by Chinese migrants. For instance, environmental pollution has become a new motivation for migration other than finance. Other factors such as levels of education provided, mature social welfare provisions, and degree of mobility are also influencing decisions to migrate. By further studying contemporary Chinese migration, this chapter summarized the new phenomena for Chinese migration, as “new Chinese migrants” and “migration deficit.” The influences from these new phenomena are the paradox between the increasing strong presence of Chinese internationally, and the shortage of labor domestically. One of the methods for the paradox might be more policies to attract foreign talents coming to the country.

References AQICN (2013) Air quality in global cities. Available at: http://aqicn.org Australian Government-Department of Immigration and Border Protection (2014) Australia’s migration trends 2013–2014. Available at: https://www.border.gov.au/ReportsandPublications/ Documents/statistics/migration-trends13-14.pdf China Business Press Release Newswire (2010) The gap between rich and poor whether the reason for Chinese high-net-worth individuals (HNWIs) immigrant overseas, 26 May. http://www. prnews.cn/press_release/35685.htm Chinanews.com (2012) Germany Got 1.1 billion immigrants, of which over 80,000 Chinese migrants with increase rate of 20 percent, 20 Dec. Available at: http://www.chinanews.com/hr/ 2012/12-20/4423669.shtml Chinanews.com (2013) 50,000 Chinese into the British nationality over 12 Years, 6 Oct. Available at: http://www.chinanews.com/hr/2013/10-06/5346439.shtml Financial Times (2013) Pollution of Beijing drives foreigners away, 2 Apr. Available at: http:// www.ftchinese.com/story/001049737 Henley & Partners (2016) The Henley & Partners visa restrictions index 2016—global travel freedom at a glance. Available at: https://www.henleyglobal.com/files/download/HP/hvri/HP% 20Visa%20Restrictions%20Index%20160223.pdf Immigration Bureau of Japan (2014) White book of immigration management 2014 Institute of International Education (IIE) (2016) 2016 open doors report. Available at: http://www. iie.org/Research-and-Publications/Open-Doors/Data/International-Students/Leading-Places-ofOrigin#.WIVr-nF8Ocs ISTAT (2014) Non-EU citizens holding a residence visa, 5 Aug. Available at: http://www.istat.it/ en/archive/129859

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Jia YM (2017) Annual report on overseas Chinese study (2016). Social Sciences Academic Press (CHINA) Li HR (2011) A profile of new Chinese immigrants in New Zealand. Overseas Chin Hist Stud 1:21–30 National Bureau of Statistics of the P.R. China (2010) China’s sixth national census. Available at: http://www.stats.gov.cn/tjsj/tjgb/rkpcgb/qgrkpcgb/201104/t20110429_30329.html National Bureau of Statistics of the P.R. China (2015) Chinese central government’s fiscal expenditure. Available at: http://data.stats.gov.cn/easyquery.htm?cn=C01&zb=A080501&sj= 2015 Ru X, Lu XY, Li P (2012) Society of China analysis and forecast (2011). Social Sciences Academic Press (China), p 73 Sohu.com (2015) The trend and task of social security in China during the period of 13th five-year, 3 Apr. Available at: http://mt.sohu.com/20150403/n410769625.shtml Statistisches Bundesamt (Destatis) (2015) Publications in the field of migration. Available at: https://www.destatis.de/DE/Publikationen/Thematisch/Bevoelkerung/MigrationIntegration/ AuslaendBevoelkerung.html Statistics Netherlands (2014) Population, sex, age, origin and generation, 1st Jan, 20 Aug. Available at: http://statline.cbs.nl/Statweb/publication/?DM=SLEN&PA=37325eng&D1= a&D2=a&D3=0&D4=0&D5=50,99,122,221&D6=a&LA=EN&HDR=T,G1&STB=G5,G2, G3,G4&VW=T The Times (2014) World reputation rankings 2014. Available at: https://www. timeshighereducation.com/world-university-rankings/2014/reputation-ranking The World Bank (2015) World development indicators: size of the economy. Available at: http:// wdi.worldbank.org/table/1.1 United Nations Department of Economic and Social Affairs (2013) International migration 2013: migrants by origin and destination, Sept. Available at: http://www.un.org/en/ga/68/meetings/ migration/pdf/International%20Migration%202013_Migrants%20by%20origin%20and% 20destination.pdf U.S. Department of Homeland Security (2016) 2014 yearbook of immigration statistics, Aug. Available at: https://www.dhs.gov/sites/default/files/publications/ois_yb_2014.pdf U.S. News (2014) U.S., China agree on new visa policy to spur growth, 10 Nov. Available at: http://www.usnews.com/news/articles/2014/11/10/obama-and-xi-jinping-agree-on-new-visapolicy-at-apec-in-beijing Wang HY (2014) Annual report on Chinese international migration (2014). Social Sciences Academic Press (China), pp 14–21 Wang HY, Miao L (2016) Annual report on the development of Chinese students studying abroad (2016) No 5. Social Sciences Academic Press (China), p 213 Wang HY, Liu GF, Miao L (2015) Annual report on Chinese international migration (2015). Social Sciences Academic Press (China), pp 13–30 Zhuang GT (2009) A new estimation of the ethnic Chinese population in Southeast Asia. J Xiamen Univ (Arts & Soc Sci) 3:62–69 Zhuang GT, Zhang JY (2012) Classification and distribution of New Chinese international migrant since 1970s. Soc Sci 12:4–11

Chapter 2

In a Different Region of the World: The Categories of Chinese Migrants Abroad

2.1

Introduction: Categories of Chinese Migrants Abroad

To speed up the process of China’s globalization, China’s international migration group is also expanding rapidly. Since 2000, the number of people from the Chinese mainland with an American permanent residence permit has increased to more than 900,000. In recent years, the number of Chinese people who have been granted permanent residence in the U.S., Canada, Australia, New Zealand, Singapore and other countries has been about 150,000 each year. Policies regarding investor migration have varied across the world, however, while the American policy emphasis on potential employment opportunities can be created by investor migrants, investor policies in some European countries prioritize investments in properties in the country. In 2014, the quota of the U.S. Business Migration Visa (EB-5 visa) in China was used up before the end of the fiscal year, more than 85% of the EB-5 visa was issued to Chinese citizens. China has been the largest source country of business migrants in the U.S. and Australia for many years. In the development of Immigration Dividend, the U.S., Germany, Australia and other countries are undoubtedly the fastest countries to promote it. Combined with China’s national conditions, the experience of introducing the advanced skilled personnel in Germany and its implication to China. Traditionally, Germany is not an immigration country, which results in highly restrictive control over foreigners’ entry and employment in Germany. During the Second World War, German immigrants accounted for only about 1% of the total population. At the end of the twentieth century, there was a phenomenon in Germany of population aging, negative growth in birth rates and a shortage of high-tech talents. The German government had to consider the interests of long-term social and economic development, so it started to conditionally encourage advanced skilled talents to immigrate there by loosening immigration restrictions. According to statistics from the UN, in 2013, the number of immigrants living in Germany was as high as 9.845 million, accounting for 11.9% of the total population. Germany had become © Springer Nature Singapore Pte Ltd. 2017 L. Miao and H. Wang, International Migration of China, DOI 10.1007/978-981-10-6074-8_2

15

16

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In a Different Region of the World …

the third largest recipient of immigrants after the U.S. and Russia, and immigrants have played a positive role in Germany’s economic growth and rise. With the development of China’s economy and along with its aging population, the introduction of the highly-skilled talents and the maintenance of economic competitiveness have become the consensus of Chinese society as well. Meanwhile, international students are an important international talent and China is also fully aware of its talent dividend. As early as October 2013, in the 100th anniversary celebration of Western Returned Scholars Association Chinese Overseas-Educated Scholars Association, General Secretary Xi Jinping fully affirmed the role of Chinese students studying abroad. Under the guidance of the principle “support studying abroad, encourage retuning back, freedom to come and go, play a role,” China will provide greater policy support to the overseas students, as well as encouraging and assisting them to return to work or serve the country in various forms. From the reform and opening up period until the end of 2015, the total number of various overseas students has reached 404.21 million, while the total number of returned students from studying abroad has only reached 2,218,600 people. The development and expansion of the international students community not only strengthened the understanding among peoples between China and other countries, but also became an important group serving the “New Normal” of China’s diplomacy. Chinese returned overseas students directly became the new force of “widespread entrepreneurship and innovation,” enhanced the internationalization level of the new round of entrepreneurship and innovation. As one of the largest groups of international migrants, Chinese international migrants have been one of the recent popular groups of immigrants for academic studies. Under the influence of the rapid economic development in China in recent decades, an important part of investor migrants are the “High-Net-Worth Individuals” (HNWI) from China. Meanwhile, there have been increasing numbers of skilled migrants in the developed countries, some of them may be also the HNWI. The overlap between skilled migrants and investor migrants is showing potential for a new developmental trend regarding Chinese migrants, to some extent it is also posing new challenges regarding recording statistics for Chinese skilled migrants and investor migrants.

2.2

Chinese Investor Migrants

Since the early 2000s there have been increasing numbers of Chinese migrants applying for investor visas. As will be discussed in this section, the number of investor migrants is increasingly dominating applications in the U.S., Canada, European member countries. There are two possible reasons for such an increase in numbers of Chinese investor migrants to these countries. Firstly, Chinese investors might be benefiting from the economic reform as increasing numbers of Chinese are able to financially support their application as investor migrants in these countries. Secondly, as China is increasingly integrating with the world internationally,

2.2 Chinese Investor Migrants

17

information on international migration is becoming increasingly accessible for Chinese people.

2.2.1

Destinations of Chinese Investor Migrants

This part is to demonstrate a general picture of the contemporary Chinese investor migrants abroad, as well as reviewing policies from major investment countries for Chinese investor migrants.

2.2.1.1

North America

The U.S. and Canada have always been two of the most popular destination countries for Chinese migrants. As summarized in the Annual Report on Chinese International Migration (2015) regarding Chinese immigration, the population of Chinese migrants in the U.S. has always taken the largest percentage of Chinese migrants. Benefiting from the economic reform, the range of average income among the Chinese population increased by more than tenfold in first-tier cities, such as Beijing, Shanghai and Guangzhou. Thereby increasing numbers of Chinese have the financial ground to apply for investor or similar types of migration to other countries. Such a change of trends can also be reflected in the changing trends of Chinese investor migrants in the U.S. and Canada (Wang et al. 2015). The American investment immigration refers to the Employment-based Fifth Preference (EB-5) immigrants, as Employment Creation Investors. According to the U.S. Citizenship and Immigration Services (USCIS), EB-5 investor program required each applicant to invest USD $1 million (USD $500,000 in some rural areas) in the States. In addition, the U.S. also imposed an economic evaluation standard to its EB-5 applicants which required each individual investment to create at least ten full-time job positions within two years (USCIS 2016). Since 2009, China surpassed South Korea as the biggest source of EB-5 visas, as well as becoming the largest source of investment immigration in the U.S. for seven successive years. Figure 2.1 shows that the percentage of EB-5 visas granted to Chinese migrants increased from 15.5% in 2007 to 86.8% in 2015. Further, in August 2014, the U.S. State Department announced that the number of EB-5 visa applicants exceeded the quota for Chinese applicant of that fiscal year, which was the first announcement of this kind since it was implemented from 1990. According to statistics, the approved Chinese applicants achieved the maximum amount, which was 90% of the total EB-5 visas granted in 2014 fiscal year. During the 2015 fiscal year, the U.S. issued 8773 investment immigrant visas, of which 7616 were from mainland China, a decrease of 692 approved Chinese applicants compared with that in the 2014 fiscal year.

2

(EB-5 Visas)

18 Grand Totals Mainland China ProporƟon

10000 9000

In a Different Region of the World …

90.0 85.1

85.5 8,308

77.6

8000

5000

70

6,250

56.7

5,683

60 50

51.0

4000

40 26.7

3000

73

30

2,233

1,828

2000 15.5 1000

100 (%) 90

7,616 80

7000 6000

86.8

20 10

581

293

0 2007

2008

2009

2010

2011

2012

2013

2014

0 2015 (Years)

Fig. 2.1 The number of U.S. investment immigration (EB-5) visas issued between 2007 and 2015. Source U.S. Department of State (2015)

Canada, as one of the traditional countries of immigration, is one of the countries that abolished its nationwide investment immigration programs recently, though the investor migrant program in Quebec has still remained active (Government of Canada 2014). In 2012, the Canadian Citizenship and Immigration Service announced that after the 1st July 2012, it would indefinitely suspend new deferral investment immigration applications. At the beginning of 2014, the federal government announced the termination of the federal investment immigration program. On 11th February 2014, Canada’s new federal budget bill said that 59,000 investment immigration applications in the system would be returned (Government of Canada 2014). The main reason for the adjustment of the policy is that the program has no long-term economic development benefits to achieve the anticipated result, the taxation of investment immigrants is much lower than other economic categories of immigrants. In addition, this adjustment was also used to promote the investment immigration projects in the provinces, a balanced development of the Canadian provinces. In order to improve the immigration policy, the Canadian government is seriously reviewing the past history and re-modifying the investment immigration policy that is suited to its national conditions, such as increasing investment, raising the threshold, and setting a reasonable quota, in order to be more responsible for the Canadian nationals. The purpose is to improve the quality of the applicants, to avoid nonparticipation in business after getting a green card, failing to acceptable residence requirement, not paying taxes, and failing to create long-term economic value.

2.2 Chinese Investor Migrants

2.2.1.2

19

European Union (EU)

Compared to EB-5 visa in the U.S. which exists especially for investor migrants, Real Estate Investment Immigration policies are widely adopted in European countries as the equivalent of investor policies. It should be recognized that such Real Estate Investment Immigration policies have a close relationship with macroeconomic policies, which has an especially close relationship with the economic crisis in 2008. As economies of some European countries were severely damaged by the crisis, countries such Iceland, Greece, Cyprus and more started reforming the Real Estate Investment Immigration policies in order to attract capital to the country. As well as increasing the number of Chinese investor migrants who are leaving the country and investing abroad, the destinations for such migration are also becoming increasingly diverse. It is highly likely that increasing numbers of Chinese investor migrants are going to continue investing in estates in European countries for the purpose of settlement. The reform in the Real Estate Investment policies started in Cyprus in 2009, which was available to both EU and non-EU citizen. Policies in other European countries then followed such reform, which attracted large numbers of Chinese investor migrants applying for the policies. In 2012, for example, the Portuguese Ministry of Internal Affairs implemented the Golden Residence Plan, a new type of immigration legislation for non-EU citizens that have invested more than 500,000 euro in estates to immigrate to Portugal with their family. According to newly released data by Portuguese Immigration Services, as of 30th November 2014, 1936 families were granted the Golden Residence Permits, with a total investment of 1.177 billion euros. Among these applications, 1561 visas were issued to Chinese applicants, which is more than 80% of the total visas granted from the policy. Other than Portugal, the Spanish governments also reformed their policies in order to attract foreign investments. The Spanish Parliament passed the Real Estate Investment Immigration bill in 2013 for the purpose of recovery from the 2008 crisis. Meanwhile, also due to the reform, more destinations are offered to Chinese investors interested in migrating to European countries. According to the latest data from the Business Investment Department in Spain, by 30th October 2014, about 2000 migrants were attracted to the country by the Real Estate Investment Immigration policy. Of these investors, 15% came from China. However, for the same visa, Portugal has proven more popular than Spain. On one hand the permanent residence and naturalization policies in Portugal is more lenient and requires less procedures compared to those in Spain; on the other hand the performance of the Golden Residence Plan for real estate investment in Spanish has not been enough to progress in the past year. Following the footsteps of Portugal and Spain, the Italian government also reformed the Italian Investment Immigration policies which since 2011 has allowed all property buyers in Italy to be eligible to apply for the Italian National Residence Card. As the detailed regulations for the policies were implemented in 2013, it was then that the policy became clear. Compared to those in Spain and Portugal, the

20

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In a Different Region of the World …

Italian Investment Immigration policy set the financial threshold for the policy much lower, at 300,000 euro. As a comparatively new policy, data available for the policy is currently limited. Data from 2014 showed that at least 100 such visas were granted to Chinese investors. Also possibly benefiting from implementation of this policy, property prices in Italian started to rise again in 2014. This slight recovery in housing prices after the 2008 financial crisis might partially be due to increasing numbers of foreign investment in Italian properties. As one of the countries hit hard by the economic crisis in 2008, the Greek parliament passed a bill in 2013 to promote the investment immigration program. The bill aims to support economic recovery in the country, as experiences from Cyprus, Spain and more showed positive evidence of the policy supporting economic recovery from the crisis. Similar to those in other European countries previously, the bill in Greece also opened the ground for non-EU citizens, while the threshold for application further reduced to property investment to 250,000 euros or more. However, restrictions are also placed on this visa. For instance, the visa can only serve as a residence permit, while work in the country is not permitted. Further, the residence card is not renewable once the property is sold; and it does not lead to permanent residency or citizenship. These obvious policy limitations hindered the promotion of the project in China. For example, the current price for property in Greece has been cut to almost 50% of that in 2008, which should have made the Greek housing market more attractive to Chinese investor migrants. However, data showed there were less than 200 Chinese investors who applied and received the residence card (Wang et al. 2015).

2.2.1.3

Australia

As one of the most popular destinations for Chinese migrants, the Australian government is also reforming their investment immigration policies to attract foreigners. For example, the Australian government reformed policies regarding Significant Investor Visas (SIV) in 2012, which has been one of the most popular immigration policies for investor migrants from China. For the increasing popularity of SIV among investor migrants, especially those from China, the Australian government has increased the available number of SIV under the Business Innovation and Investment category since November 2012. From November 2012 to September 2014, 286 SIV were issued, which brought 1.43 billion dollars of investment to the Australian economy. Among all applicants successfully applied for the SIV, 90.5% were Chinese citizens (DIBP 2014). As further attempts to attract more affluent investors, the “high-end investor visa” was implemented by the Australian Immigration Department in October 2014 to provide a new channel for Chinese immigrants.

2.2 Chinese Investor Migrants

21

As another recent policy for attracting Chinese investor migrants, the Australian Department of Immigration and Citizenship implemented a 3-year, multiple-entry visa policy for Chinese business people in February 2014. This policy is one of the attempts by the Department of Immigration and Border Protection (DIBP) on simplifying the procedures for the immigration process for investor migrants from China. To some extent it reduced the administrative barriers for Chinese investment when entering the Australian economy, and a number of Chinese investor migrants have been attracted to Australia since 2014 which resulted in increased trade between China and Australia between 2014 and 2016. Further, it is significantly influencing the implementation of similar immigration policies between China and other countries. For example, a similar long-term business visa between China and the U.S. was implemented in November 2014, while a similar long-term business visa between China and Canada was implemented in March 2015.

2.2.2

High-Net-Worth Individuals (HNWI) in Developed Countries/Region

In mainland China, investment immigrants are primarily from affluent backgrounds and are usually a part of the “High-Net-Worth Individuals (HNWI).” The HNWI is defined as those whose private investable assets are above RMB 10 million. According to the White Paper on China Spiritual Investments 2014, there are over 2.9 million Chinese that had over RMB 6 million worth of personal assets in 2013. Further, there are 67,000 personnel with personal assets above RMB 100 million. It also indicated that the number of the HNWI in China, as well as assets owned by these personnel, has been on the increase. By the end of 2014, as shown as the White Paper on Chinese High-Net-Worth Individuals Wealth Report 2015, the total China private investable assets were RMB 106.2 trillion. Compared with 2011 they have increased by RMB 33.1 trillion, with an average annual growth rate of 13.3%. According to the White Paper on China Spiritual Investments 2014, the geographic distribution of the HNWI in China follows the trend of regional economic development in the country. The population in Eastern Chinese regions accounts for 44%, followed by Northern Chinese regions at 23%, and Southern Chinese regions with 18%. Regions in Northeast, Southwest, Central and Northwest combined accounted for 15% of the total population of the HNWI in the country. Looking at the distribution of the HNWI in terms of cities and provinces, it should also be recognized that the population are concentrating in economically developed regions. For example, the number of the population in Beijing is the highest at 490,000, followed by Guangdong (486,000), Shanghai (420,000) and Zhejiang (380,000). Numbers of the HNWI in these four provinces and cities accounted for 61% of the total HNWI in China.

22

2.2.2.1

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In a Different Region of the World …

Investment Immigration and Dual Locations

Another recent phenomenon from Chinese investor migration is working and living in China with non-Chinese citizenship or pending application for the investment immigration in other countries. As discussed earlier in this chapter, with examples of relevant policies in the US, Canada and Australia, investor immigration often leads to settlement in the host country. However, the continuing economic development in China is presenting business opportunities from China, and it is especially the case in international cooperation between China and other countries. On the other hand, it should also be recognized that large numbers of Chinese investor migrants are in the businesses of or relating to international cooperation between China and other countries. Although these Chinese investor migrants have non-Chinese citizenship or a pending application for investment migration abroad, they are in circular migration between China and host countries or mainly residing in China. Mainly due to how most participants in this population are declaring confidence for the Chinese economy, the assets of these investor migrants are mostly in China.

2.2.2.2

Categories of Investment

According to the White Paper on China Private Wealth Report 2015, the Chinese HNWI investments abroad concentrated in three main categories, which together account for 80% of the total numbers of the Chinese HNWI investment abroad in 2015. These three main categories include stocks (29%), fixed income products (27%) and real estate (24%). Categories for the remaining investments include 8% in structured product; hedge fund accounted for 8%; 5% in others. Such categories of Chinese investment abroad provide evidence that the Chinese HNWI investments are currently concentrating on investments with relatively lower risks, yet which yield high returns. However, the proportion of equity products (e.g. stocks) with higher returns in foreign assets has increased compared with two years ago.

2.2.2.3

Chinese Investor Migrants and Property Investment Abroad

Under the influence of the continuous economic development in China, especially after the economic crisis in 2008, the number of Chinese investor migrants and investment in properties abroad has also been on a continuous increase. First there has been a continuous increase in the number of Chinese investor migrants internationally. As the Report of the Visa Office showed, the number of Chinese investor migrants in the U.S. increased from 581 Chinese EB-5 conditional “green cards” holders in 2010 to 8308 in 2014, to 7616 in 2015 (U.S. Department of State 2015). Further, as shown as the latest customer survey from Boston Consulting Group (BCG), the global assets allocation of the Chinese HNWI

2.2 Chinese Investor Migrants

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showed an increase in demand in 2015: 27% of high-net-worth clients already had offshore investment, 48% of high-net-worth customers have increased their overseas assets allocation in 2015, and 56% of HNWI who have not yet made overseas investment said they would consider investing abroad in the next three years. To sum up, we expect that the proportion of China’s foreign asset allocation from the current 4.8 to 9.4% over the next five years and the new market scale to reach RMB 1.3 billion. Moreover, according to the White Paper on China Private Wealth Report 2015, the increasing number of the Chinese HNWI investments is concentrating in Hong Kong, the U.S. and Australia, with countries such as Canada, Singapore and the U.K. following behind. Such a concentration of Chinese investment in Hong Kong, the U.S. and Australia is hardly surprising. Hong Kong is close to mainland China, many Chinese banks have set up the local service network to provide more a more convenient opening service for investment accounts. For the HNWI in China, Hong Kong has been the first choice of overseas investment, especially financial investment, due to its favorable policies with low tax rates, geo-advantages with close cultural and comparatively free and an open economic environment. While the Chinese HNWI who select the U.S., Australia or other countries normally invest their money in real estate or industrial investment, there also seems to be no shortage of investment immigrants. Investment in Hong Kong is still mainly based on equity funds and other financial products. Among these categories of Chinese investments, investment in properties abroad is a category with increasing popularity. In 2015, China’s capital investment in overseas real estate funds amounted to USD $30 billion; twice as much as in 2014. In fact, this figure in the first ten months of 2015 had more than the total annual amount of USD $15.1 billion in 2014, compared with 2009 increased by 50 times (Tencent Finance and Economics 2016). The White Paper on Going Global: Trends of the Chinese HNWI 2016 reported that immigration agencies and international real estate consultants are the two most commonly used channels by the Chinese HNWI for investing in property overseas, with 50% of the Chinese HNWI investing through immigration agencies and 43% investing through international real estate consultants. The Chinese HNWI with an overseas presence have an average of 2.3 properties overseas. Investment is the main purpose of their overseas home ownership, accounting for 75%; this is followed by their children obtaining a foreign education, accounting for 56%. The U.S. is definitely the Chinese HNWI overseas home buyers’ favorite country, with a selection rate up to 66%. The top five countries are Australia (14%), Canada (10%), the U.K. (5%) and Japan (4%). According to the data of National Association of Realtors of the U.S., Chinese buyers were already the largest foreign buyers of U.S. real estate from March 2014 to March 2015. The Chinese contribution to sales were more than USD $28.6 billion, accounting for 30% of the total sales (nearly USD $104 billion). In the case of European countries, Chinese investor migrants are also playing an increasingly important role. This is particularly the case since the economic crisis in 2008, which are still influencing the housing market in most European countries. The relatively lower property prices in European countries are attracting increasing

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numbers of Chinese investor migrants investing in properties in these countries. The largest British property developer Barratt Developments sold 2250 houses to Chinese buyers in 2012, accounting for 15% of their total sales in that year. In March 2012, the numbers of people from overseas who were renting houses in Britain surpassed 2 million for the first time (China.com 2017). Chinese real estate buyers quickly became the prominent, new customers for local real estate markets in the U.S., the U.K., Australia and others, known as “the group of Chinese property buyers.” Meanwhile, Chinese property investors are extending their investment from capital cities and first-tier cities to the rest of these European countries, such as Germany and Belgium. They can also be found in housing markets in Edinburgh, Detroit, Kuala Lumpur and more. To some extent these can all be seen as evidence that Chinese investor migrants are supporting recovery of local housing markets in these countries since the economic crisis in 2008. Property developers in Sydney went further by predicting that without investments from Chinese property buyers, housing prices in some Australian regions might have to fall by a further 25% (NetEase 2013).

2.2.2.4

International Chinese Migrants’ Role in Promoting Enterprise Globalization

Other than the increasingly important role of Chinese investor migrants in supporting the recovery of global housing markets, their businesses are also playing an increasingly important role in the globalization of Chinese enterprises and brands. Such an increasingly important role can be reflected in two main themes, Chinese property businesses and Chinese financial institutions expanding overseas. Other than as individual property buyers abroad, evidence shows that increasing Chinese insurance companies and property developers are also investing abroad. In 2015, Insurance companies have become one of the most powerful roles for Chinese capital overseas real estate investment activities. Chinese insurance companies bought more than USD $4 billion in overseas property assets in 2015, which was double the amount compared to 2014 (USD $2 billion). In particular, Anbang Insurance Group scored the largest investment project in overseas real estate in 2015. Anbang spent USD $1.95 billion to invest Waldorf Hotel which is a landmark building in New York, and also spent USD $414 million to invest Merrill Lynch in Manhattan. Meanwhile, China Taiping Insurance Group spent USD $820 million to invest the New York 111 Murray Street development projects in July 2015; Bank of China spent USD $600 million to invest the New York 7 Bryant Park office building projects in May 2015; Ping An Insurance (Group) Company of China spent USD $506 million to invest in the London Tower Place office building projects in January 2015; China Life Insurance (Group) Company spent USD $420 million to invest in the London 99 Bishopsgate office building projects in October 2015; and Fosun International spent USD $384 million to invest in the Milan Palazzo Broggi office building project in July 2015 (Tencent Finance and Economics 2016). Likewise, Real estate developers were also an influential force in

2.2 Chinese Investor Migrants

25

2015. These Chinese companies invested more than USD $90 billion for development and construction around the world, an increase of 50% compared with the year before (USD $6 billion). In response to the increasing scale of Chinese investors purchasing abroad, financial institutions from China as well as international ones are expanding their services. As discussed earlier in this section, Chinese investors, especially high-net-worth individuals, are in a circular migration between China and their host countries/regions. This is particularly the case for Chinese business investors. This is increasing the demand for flexible international financial services, for example overseas investment and asset allocation services. The provision of such services in the expansion of Chinese and international finance institutions are market responses to the increasing numbers of Chinese investor migrants abroad; meanwhile, it is also accelerating the process of globalization for the international finance market.

2.2.3

Future Trends of Investor Migrants

As discussed in the beginning of this section, the rapid economic development in China is setting the foundation for the development of Chinese investor migrants. It is likely that the purchase power for Chinese will continue to grow. Meanwhile, Chinese governments are continuing to ease regulations for Chinese population investing abroad, China’s State Administration of Foreign Exchanges lifted the overseas investment limit from USD $20,000 to $50,000 in 2007 (Ministry of Commerce of the People’s Republic of China 2007). Further, RMB joined the Special Drawing Right (SDR) on October 2016 which could have a positive influence over purchasing power of Chinese people as well as Chinese investment abroad (The People’s Bank of China 2016). These are supporting a potential expansion of Chinese investment abroad from the Chinese perspective. The international community is gaining knowledge and experiences of the positive influence Chinese investor migrants could have on local economies through their support in the recovery of housing markets in European countries, the U.S., Australia and more. It is highly possible that Chinese investor migrants will remain one of the most attractive groups of migrants internationally. It means that policies regarding investment migration internationally will remain positive about Chinese investor migrants. It is highly possible that Chinese investor migrants will continue to grow in the near future.

2.3

Chinese Skilled Migrants

Compared to the Chinese investor migrants which are a recently established group of Chinese international migrants, Chinese skilled migrants started from pre-world wars, and are widely distributed internationally. Professional migrants such as Prof.

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Qian Xuesen and Prof. Yang Zhenning made significant contributions in their relative fields internationally. Together with the rapid economic development in China in recent decades, the number of skilled migrants, especially professional migrants from China, are also on the increase. Furthermore, they are increasingly influential internationally. These Chinese skilled migrants are gaining such importance in the global labor market that they are becoming an important part of the Chinese brand internationally. Therefore this section will provide a brief picture of Chinese skilled migrants, especially professional migrants internationally.

2.3.1

Geographic Distribution

In recent years, increasing numbers of Chinese skilled migrants are migrating to almost all countries in the world. Other than traditional migration destinations in the global north, there is an increasing presence of Chinese skilled migrants in countries/regions of the global south (DESA 2013). The reason for the increasing presence of Chinese skilled migrants internationally is due to the increasing influence of the growing economic development in China, and its increasing global influence. For the past few years, there have been increasing numbers of Chinese businesses investing abroad. Possibly for the lower levels of costs compared to countries in the global north, increasing numbers of Chinese businesses, including State-Owned Enterprises (SOEs) are investing in Africa and Latin American countries. China’s Foreign Direct Investment (FDI) into Africa averaged USD $14 million per year in the first half of the 1990s and this number jumped to a peak value of USD $11.7 billion in 2008, then the FDI fell to USD $568 million in the first half of 2015 due to the impact of the economic crisis. Although China’s total investment in Africa fell sharply in the first half of 2015, investment in extractive industries nearly doubled. In this period, China’s investment in oil, gas, coal, mining and metals projects in Africa increased from USD $141.4 million in the same period the previous year to USD $288.9 million (The Financial Times 2015). China has also been active in infrastructure investment in Latin America, from USD $285 million in 2004 to USD $29 billion in 2015, an increase of 100 fold within a period of 12 years (Inter-American Dialogue 2016). Recently, three Ministries (Ministry of Commerce of the P.R. China, National Bureau of Statistics of the P.R. China, State Administration of Foreign Exchange) jointly issued the 2015 Statistical Bulletin of China’s Outward Foreign Direct Investment (National Bureau of Statistics of the P.R. China 2016). China’s direct investment in the U.S. reached a record high of USD $8029 million in 2015, accounting for 5.5% of the China’s total FDI flows. Statistics show that the direct investment fields of China were diversified in the U.S. in 2015. Chinese immigrant investors primarily invested in three industries in the U.S., and their investment has surpassed USD $1 billion. Investment in U.S. manufacturing ranked first with USD $4080 million, which increased by 122.2%, accounting for 49.9% of investment flows to the U.S.; with

2.3 Chinese Skilled Migrants

27

leasing and business services, scientific research and technical services, ranked second and third respectively, at USD $22.39 billion and USD $1.228 billion. To sum up, most of these investments are from Chinese SOEs. Together with these Chinese businesses investments in these countries, there is an increasing presence of Chinese skilled migrants in these businesses. Despite increasing numbers of Chinese skilled migrants in the countries of the global south, the majority of Chinese skilled migrants, in particular professional migrants, are concentrating in countries/regions in global north. They are mainly concentrating in the U.S., Canada, the U.K., Germany, Australia and so on. Using Chinese skilled migrants in these countries as examples, the following briefly discusses the trend for development of Chinese skilled migrants in these regions.

2.3.1.1

North America

Since pre-First World War, the U.S. and Canada have been two of the traditional top destinations for Chinese skilled migrants, especially professional migrants, both countries have the largest population of Chinese skilled migrants abroad internationally. As one of the most popular destination countries, there were 21,889 Chinese skilled migrants in the U.S. in the fiscal year 2015 as shown in Table 2.1. As the U.S. economy also requires large numbers of skilled migrants, the designated migration policies are made and implemented for skilled migrants, especially for professional migrants. But international students and skilled migrants became worried about their prospects in the U.S. after Trump ran for president successfully. However, the U.S. Department of Homeland Security published the “Final Rule” on November 18th 2016 in the “Federal Register,” where published the new regulations and policies for the Federal Government. The “Final Rule” involved a number of amendments to the regulations for EB-1, EB-2 and EB-3, which provided positive benefits to Employment Immigration Visa and Nonimmigrant Visas, such as improving the application process, increasing the certainty of U.S. employers in funding and retaining foreign employees, and providing foreign employees with greater stability and work flexibility (especially important). Also the “Final Rule” was going to be implemented on January 17th 2017, three days before Trump was sworn in (U.S. Homeland Security Department 2016). To be understood, this was a tactic of the outgoing Obama administration to help U.S. employers to attract and retain high-skilled professional and technical immigrants. In particular, the “Final Rule” emphasized that these positive adjustments were made primarily for those approved employment-based immigrant visa petitions as well as those who were waiting to become lawful permanent residents to facilitate these skilled migrants to promote and accept other positions offered by current employers (or to replace employers) and search for alternative employment options.

Total employment-based preferences

2006 1815 2007 13,615 2008 15,067 2009 11,191 2010 17,792 2011 17,225 2012 21,109 2013 20,078 2014 22,641 2015 21,889 Source U.S. Department of State

Year

457 2982 5602 4999 6741 3940 6183 6249 6167 6239 (2015)

First: priority workers 72 6797 6955 3045 6505 8257 5858 3627 3561 4202

Second: professionals with advanced degrees or aliens of exceptional ability 1213 3681 2057 1077 3676 2542 2827 3229 3676 3211

Third: skilled workers, professionals, and unskilled workers 10 45 93 91 98 78 117 78 109 81

Fourth: certain special immigrants

63 110 360 1979 772 2408 6124 6895 9128 8156

Fifth: employment creation (investors)

Table 2.1 The number of Chinese obtaining lawful permanent resident status by employment-based preferences in the U.S. between 2006 and 2015

28 2 In a Different Region of the World …

2.3 Chinese Skilled Migrants

29

In the specific provisions, the Government provides 60 days of unemployment grace period for H-1B, L1, O1 and other types of work visa holders. So even if they lost their jobs, the identity will not also be lost, and they will have ample time to apply for a new job or to reapply for the H-1B (no need to re-draw). In addition, the application of I-140 immigration green card was approved by the immigration authority, so even if the employer revoked the application or there was a company failure, it would not affect the validity of immigration green card applications. There are three categories of Chinese migrant visas: permanent residence visas applicants, nonimmigrant temporary visas for professional migrants, and international students, who are the potential high-skilled labors. Moreover, H, L, O, P, and the TN visas are designed for professional migrants on a temporary basis. The number of Chinese professionals in the U.S. with one of these temporary visas has also been on the increase in the past few years as shown as in Table 2.2. There were 23,787 Chinese professionals who received the H-1B visas in 2012, a 19.8% increase from 2011. The number further increased to 26,393 in 2014. Meanwhile, as will be discussed in the next section, the U.S. has the largest group of Chinese students abroad, which is also on the increase. Such general increasing presences of Chinese skilled migrants, professional migrants and potential skilled labor in the U.S. might be evidence that the reputation for Chinese skilled migrants and potential skilled migrants is spreading internationally. However, Trump’s inauguration brings the uncertainty of the H-1B program for highly-skilled immigration. Trump believes that “The H-1B program is neither high-skilled nor immigration; these are temporary foreign workers, imported from abroad, for the explicit purpose of substituting for American workers at lower pay. I will end forever the use of the H-1B as a cheap labor program, and institute an absolute requirement to hire American workers first for every visa and immigration program. No exceptions.” Nevertheless, the relevant provisions of the H-1B visa are protected by U.S. immigration law. If the relevant content of immigration law would be amended, Senate and House would need to approve the changes via a

Table 2.2 The number of Chinese obtaining the three types of visas in the U.S. between 2008 and 2014 Year

International students People Proportion

H-1B People

Proportion

Permanent residence People Proportion

2008 81,127 13.0 13,828 3.4 80,271 7.3 2009 98,235 14.6 12,922 3.8 64,238 5.7 2010 127,628 18.5 19,493 4.3 70,863 6.8 2011 157,558 21.8 19,850 4.0 87,016 8.2 2012 194,029 25.4 23,787 5.0 81,784 7.9 2013 235,597 28.7 23,429 8.2 71,798 7.2 2014 274,439 31.0 26,393 8.4 76,089 7.5 Unit People (%) Sources Institute of International Education: Open Doors 2015 Report; U.S. Department of Homeland Security: 2014 Yearbook of Immigration Statistics

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Table 2.3 The number of Chinese immigrants in Canada between 1970 and 2015 1970–1980 Mainland, China 10,600 Hong Kong, 83,900 China Taiwan, China 9000 Total 103,500 Unit People (%) Source Government of Canada

1981–1990

1991–2000

2001–2009

2010–2015

36,200 129,300

181,200 240,500

301,700 13,200

170,136 3919

Total 699,836 470,819

14,300 179,800

79,600 501,300

24,400 339,300

7394 181,449

134,694 1,305,349

vote, and then the amended content of immigration law would be implemented after the president signed. It is possible that this process is unable to be approved before the president steps down. Therefore, it is still a question mark whether the Trump’s H-1B program can be achieved. Other than the U.S., Canada is the other popular destination for Chinese skilled migrants in North America. As showed in Table 2.3, the number of Chinese migrants to Canada increased rapidly after the economic reform in 1979. Since 2001, the number of Chinese migrants have become the largest group of migrants in Canada, exceeding those from Hong Kong and Taiwan. Like other countries, Canada is also faced with a labor shortage, especially a shortage in skilled and professional workers. The Hays Global Skills Index Score shows that Canada has a score around 5.9, which means the country is facing a challenge finding qualified staff for skilled jobs (HAYS 2013). In order to fill such gap of labor, numerous programs and policies were made by the Canadian government to attract skilled international migrants to the country. Since January 1st 2015, foreign nationals who wish to immigrate to Canada as skilled migrants need to submit their personal data and immigration applications through Express Entry (including the Federal Skilled Worker Program, Federal Skilled Trades Program, Canadian Experienced Class and a portion of the Provincial Nominees Program) which is a reform concerning Canada’s application management system for certain economic immigration programs. According to Express Entry Year-End Report 2015 (Government of Canada 2016), the report shows that over 31,000 invitations to apply for permanent residence have been issued to a diverse range of high skilled immigrants and almost 10,000 individuals (principal applicants and their family) have already landed in Canada as permanent residents, of which 409 (Country of Residence) and 1678 (Country of Citizenship) invited candidates from China as of January 3rd 2016. Other than policies attracting skilled migrants internationally, the Canadian government also reformed relevant social welfare policies so that skilled migrants have access to the welfare system, such as the child tax benefit, child care subsidy, government housing, social welfare, employment insurance (EI), healthcare plan, vocation opportunity, pension plan (CPP) and so on. As migration programs and

2.3 Chinese Skilled Migrants

31

policies attract international skilled migrants to the country, while access to the Canadian welfare system retaining skilled migrants by providing safe-net for their living and working in the country. As shown as Annual Report on Chinese International Migration (2015), it was revealed that a developed welfare system is one of the top five factors influencing the decision-making for Chinese migrants on their migration. This likely influences the increasing numbers of Chinese skilled migrants to Canada.

2.3.1.2

European Union (EU)

Similar to their Northern American counterparts, European countries are also facing a shortage of skilled labor. There are low fertility rates across the economically developed countries in Europe. In 2014, the total fertility rate in the EU-28 was 1.58 live births per woman, while a rate of around 2.1 is normally required for a stable population (Eurostat 2016). The low fertility rate is putting extra pressure on the future of the skilled labor force in European countries (The National Bureau of Economic Research 2016). In order to fill gaps in labor shortage, increasing numbers of European countries are implementing migration policies targeting migrants with high levels of skills and/or education. This section uses the U.K. and Germany to illustrate Chinese skilled migrants in Europe. Together with the points-based migration system, the British Home office is employing a Tier 1 visa (migrants with highly professional skills) and Tier 2 visa (skilled workers with an offer of employment) programs for long-term skilled migrants to the U.K. Since the 2008 economic crisis, the U.K. has shown that British immigration policies have been becoming increasingly restrictive, especially for work visas. However, it should be recognized that these restrictions include rising requirements in terms of levels of education and skills, and the amount of investment in the U.K. Rather than restrictions, such changes in the regulations regarding visas should be regarded as evidence that the British labor market is increasingly targeting skilled and professional migrants. Under such changes in British immigration policies, increasing numbers of Chinese skilled migrants are migrating to the U.K. Compared to those in the U.S. and Canada, the population of Chinese skilled migrants in the U.K. is small. In 2013, according to Annual Report on Chinese International Migration, there were 11,300 Chinese people from mainland China who were paying for National Insurance in the U.K. From Sep. 2013 to Sep. 2014, the U.K. has issued 161,585 work visas, the top 10 countries with the highest number of work visas were India (57,165), Australia (16,510), the U.S. (14,846), Philippines (8900), Canada (6407), New Zealand (5447), China (5002), Pakistan (4605), Japan (4410) and Russia (3574), of which the number of work visas from China increased by 17% compared with 2013, an increase of 728 Chinese people (Wang et al. 2015). Germany is one of the most popular destinations for Chinese skilled migrants and the number of immigrants employed there is slowly increasing (Fig. 2.2). On August 1st 2012, the German government implemented the new “residence law”

32

2 16,000

In a Different Region of the World … 14,468

14,000

(People)

12,000

11,290

11,848

10,000

8,670

8,000 6,000 4,000 2,000 0

2013

2014

2015

first half-year (Year) 2016

Fig. 2.2 EU blue cards issued in Germany. Source Federal Office for Migration and Refugees (2016)

which added the EU blue card system. This systems legal foundation is provided by section 19a of the Residence Act for attracting highly-qualified specialists into the German labour market from third world countries. At present, the issued EU blue cards account for 87% of the total issued visas in Germany. The advantage for EU blue card holders is that they just need to stay in Germany for 33 months to be able to obtain the permanent residence. If the language (German) reaches B1 level, the applicants only need to stay in Germany for 21 months to obtain the permanent license. In the first half-year of 2016, 8670 EU Blue Cards were issued in Germany (Fig. 2.2), up by 17.8% compared with the same period of the previous year, when 7363 Cards were issued. 4766 (55%) of the Cards issued in first half-year 2016 were to first-timers, i.e. the holders had never held a residence title in Germany before. As Fig. 2.3 shows, the vast majority of applicants in first half-year of 2016 came from India (22.1%), China (8.7%), the Russian Federation (7.9%), Ukraine (5.3%) and Syria (4.7%).

2.3.1.3

Australia

Other than the U.S. and Canada, Australia is another popular destination for Chinese skilled migrants. The “Skill stream” is designed for workers who have the skills, qualifications and entrepreneurship most needed in the Australian economy. These skilled migrants help the Australian economy directly through increased productivity and by filling labor market needs and shortages (Fig. 2.4). They also provide an indirect benefit through increased demand for goods and services, creating more jobs and reducing unemployment.

2.3 Chinese Skilled Migrants

33

India, 22.1%

China, 8.7%

Others, 51.3%

Russian FederaƟon, 7.9% Ukranine, 5.3% Syria, Arab Republic, 4.7%

Fig. 2.3 Top 5 nationalities receiving EU blue cards in first half-year of 2016. Source Federal Office for Migration and Refugees (2016)

Fig. 2.4 Youth labor market outcomes have been declining. Source Productivity Commission of Australian Government (2016)

In 2014–2015, the Skill stream took in 127,774 skilled migrants, representing a 0.6% decrease from the previous year. Australia’s Skill stream comprises four components. The largest is Points Tested Skilled Migration, which accounted for 57% of the Skill stream. This was followed by Employer Sponsored visas (37.8%)

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Table 2.4 The number of Chinese immigrants of skill stream in Australia between 2009 and 2015 Years

2009– 2010

2010– 2011

2011– 2012

2012– 2013

2013– 2014

2014– 2015

Points tested skilled 5698 12,158 7895 8034 8339 8584 migration visas Permanent employer 4496 3480 3235 3718 3476 3365 sponsored visas BIIP visas 4294 4791 4614 5058 4614 4870 Summation Total skilled visas 14,488 20,429 15,744 16,810 16,429 16,819 Total permanent visas 24,764 29,547 25,509 27,334 26,776 27,872 Proportion 59 69 62 61 61 60 Unit People (%) Source Australian Government Department of Immigration and Border Protection, Australia’s Migration Trends 2010–2011, 2011–2012, 2012–2013, 2013–2014, 2014–2015

and the Business Innovation and Investment visas (5.1%). Distinguished Talent is the smallest visa component, representing 0.2% of the Skill stream in 2014–2015. According to Australia’s Migration Trends 2014–2015, 205,383 permanent migration visas were granted for the 2014–2015 program year—a decrease of 1.2% on the 207,947 available in the previous year, this comprised 189,097 places under Australia’s Migration Program. For the fourth year in a row, China was the second largest source country for the Migration Program with 27,872 visas granted, of which 8584 Chinese applicants granted through the Points Tested Skilled Migration component, an increase of 245 places compared with 2013–2014 (Table 2.4). After the economic crisis, the number of Chinese immigrants who received the skilled immigrants visa in Points Tested has increased for four years since 2011, but has not yet reached the level of 2010 (DIBP 2016). Permanent Employer Sponsored migration allows businesses to employ the skilled workers they need to fill genuine job vacancies. These workers can be from outside Australia or they can be temporary visa holders living in Australia. Permanent Employer Sponsored visas are not capped and receive higher processing priority, to respond quickly to the needs of Australian employers. In 2014–15, 3365 Chinese permanent Employer Sponsored places were filled (Table 2.4), equivalent to 7.0% of the overall permanent Employer Sponsored visas and 2.6% of the Skill stream. As Table 2.4 shows, Chinese nationals continued to be the main recipients of BIIP (Business Innovation and Investment Program) visas, with their share of each year’s total, increasing from 72.2% in 2012–2013 to 75.1% in 2014–2015. Most Chinese nationals in 2014–2015 were granted BIIP visas under the Business Innovation stream (39.6%) and the Significant Investor stream (33.4%). Moreover, a series of reforms to the Skill stream during the past six years, which had an impact on the number of students eligible to apply for permanent residence

2.3 Chinese Skilled Migrants

35

immediately after graduation. The primary effect of this was a fall in the number of Skilled Independent visas granted to graduating students. A better academic environment, well-developed industry, and abundant resources might be some of the key factors which caused them to migrate. Because of these factors, Chinese professionals tend to migrate to developed countries. Under this circumstance, most of the Chinese skilled migrants tend to migrate to North America, Europe and Oceania where most of the Chinese skilled migrants are located. By estimating the overseas Chinese professionals residing in these countries, it will give us a rough understanding about the overall distribution of the highly skilled Chinese migrants.

2.3.2

The Characteristics of Chinese Skilled Migrants

Other than the three countries/regions discussed above, Chinese skilled migrants can also be found in almost every continent. From data currently available, this section summarizes four major characteristics of Chinese skilled migrants abroad.

2.3.2.1

Diverse Distribution in Profession

According to the 2012–2013 survey conducted by Center for China and Globalization (CCG), overseas Chinese skilled workers, including professionals, are working across a diverse range of industries, including computer engineering, information technology, biotechnology, medical research, arts and design, green energy and so on (Wang and Miao 2014a, b). The engineering-related industries may remain the dominant career path for Chinese skilled migrants abroad. Figure 2.6 shows that Chinese skilled migrants, especially professionals, have started engaging across various industries. For example, 32% were engaged in the innovation of new generation electronics and IT services, 17% on new medicines and more. Further, Fig. 2.5 suggests that Chinese skilled migrants have started to engage in recently emerged industries, for example, 7% in new energy and 5% in energy saving and environment protection. Another interesting fact from Fig. 2.5 is the proportion of Chinese skilled workers in the culture creativity industry. This industry was not popular with Chinese skilled migrants previously, but currently there are 7% of Chinese skilled migrants abroad that are working in it. However, the reasons for such a sudden development in the number of Chinese skilled migrants in this industry still requires further research to explain.

36

2 Agriculture, forestry, husbandry, fishing , 2%

In a Different Region of the World …

Others, 12% Finance, 2%

New material, 2%

New generation electrical, information technology, 32%

Energy saving and environment protection, 5% New energy, 7% High-end devices manufacturing, 9% Culture creativity, 11%

New biotechnology, new medicine, 17%

Fig. 2.5 Distribution for overseas Chinese professionals. Source Center for China and Globalization (CCG), Survey 2012–2013, Report on Overseas Chinese Professionals (2014), 2014

2.3.2.2

Overlapping with Investor Migrants

The second characteristic of Chinese skilled migrants abroad, especially for Chinese professionals, is that they are growing at a steady rate. Such steady growth should be recognised as the result of the continuous economic development in China, and the overlap between skilled migrants and investor migrants from China. There have been large numbers of Chinese skilled migrants in traditional migration countries such as the U.S., Canada, and Australia, since the pre-economic reform period (before 1979) in China. Under the influences of the rapid economic development in China since the economic reform, increasing numbers of Chinese have had access to higher levels of education as well as skill training. Those that became successful are the main sources for investor migrants, for example the high-net-worth individuals discussed in the previous section. The overlap between skilled migrants and investor migrants is further demonstrated in the 2013 China Private Wealth Report, released jointly by the China Merchants Bank and Bain Management Consulting Company. The 2013 report is aimed at providing an accurate description of the major trends in China’s current market and a clear picture of high-net-worth individuals’ investment attitudes, especially Chinese skilled migrants and professionals abroad. According to the report, the number of Chinese skilled migrants migrating abroad are not only skilled migrants, frequently they are migrating through applications as investor migrants. Therefore, skilled migrants from China may be one of the traditional types of Chinese migrants internationally. The overlapping with investor migrants can be regarded as one of such new characteristics.

2.3 Chinese Skilled Migrants

2.3.2.3

37

Increasing Participation in Academic Fields

The third growing characteristic for Chinese skilled migrants abroad is the increasing participation in academics. According to report by Essential Science Indicators (ESI), 439 Chinese scientists are in the top 1% of the scientists who have the highest number of citations between 1st January 1999 and 30th April 2009, of which 309 (70%) of these Chinese scholars were living overseas (Wang et al. 2010). The diverse geographic distribution for these Chinese professionals internationally (Fig. 2.6) shows that majority of Chinese professionals are shared between the U.S. (62%) and Mainland China (19%). By the end of 2013, among the academics in National Academy of Sciences (NAS) and National Academy of Engineering (NAE) of the U.S., there were total 188 overseas Chinese, of which 156 were Chinese American, accounting for 3.9% of the total number of academics (Table 2.5). The Chinese Scientific and Technological Personnel Overseas Development Current Situation Analysis Report 2008 published by the Institute of Scientific and Technical Information of China (ISTIC), provided further evidence for the increasing participation in academic fields of Chinese skilled workers, especially professionals. According to the report, there were about 1 million Chinese skilled migrants, especially professionals, working in science and technology fields, more than 90% of them holding masters or doctoral degrees. Meanwhile, there is a high concentration of Chinese professionals in the natural sciences and roughly 40% of academic journals published in fields of Science, Nature or Cell were either written or contributed to by Chinese scholars (Wang and Miao 2014a, b). Such an increase in participation of Chinese professionals in academic fields is, however, hardly surprising. The number of Chinese skilled migrants is increasing

Singapore, 1% Australia, 1%

Others, 1%

Britain, 2% Canada, 3% China Taiwan, HK and Macao, 11%

Mainland China, 19%

United States, 62%

Fig. 2.6 Geographic distribution of the top 1% Chinese scientists between 1st January 1999 and 30th April 2009. Source Essential Science Indicators (ESI) (2010)

38

2

In a Different Region of the World …

Table 2.5 The number of overseas Chinese academicians in NAS and NAE of the U.S. by the end of 2013 Institution

Total academicians

Overseas Chinese academicians

Proportion

National Academy of Sciences 1770 79 4.46 (NAS) National Academy of 2196 109 4.96 Engineering (NAE) Unit People (%) Sources National Academy of Sciences (NAS). Available at: http://www.nasonline.org/memberdirectory; National Academy of Engineering (NAE). Available at: http://www.nae.edu/ MembersSection/Directory20412.aspx

steadily under influence of the rapid economic development in China. Further, the geographic distribution of skilled migrants is spreading from traditional migration destinations such as the U.S. and Canada, to the rest of the world. For example, evidence suggests that increasing numbers of Chinese skilled migrants are migrating to non-traditional migration destinations, such as developing countries in Africa and the Middle East (Wang and Miao 2014a, b).

2.3.2.4

Circulate Migration

The fourth and final growing characteristic of Chinese skilled migrants is the increasing trend of circular migration between host countries and China. As it was discussed in the previous section, circular migration is increasingly becoming one of the main characteristics for Chinese investor migrants. Coinciding with the overlap between investor migrants and skilled migrants, evidence shows an increasing trend of circular migration for Chinese skilled migrants. The most significant official evidence is the latest reform in the Thousand Talent program in 2010, where an applicant can live in China part-time. This part-time residence in the country means that the applicant can take jobs in China as well as abroad, compared to how previously the applicant had to live in China full-time. It should be recognized that Chinese policies have also reformed as a response to the increasing needs of the target recipients of the policy. This means that these professionals do not have to give up their jobs in the host country in order to work in China under the Thousand Talent program. Such increasing trend of circular migration for skilled migrants is again coinciding with that of investor migrants, as discussed in the previous part. The potential reason for this is summarized in this section and is similar to that for investor migrants in China. The most influential reason for it remains the rapid economic development in China. Under the influence of the rapid economic development in China, and the increasing need for upgrading skills and knowledge in technology and more, have been creating large numbers of opportunities in the market. Compared to

2.3 Chinese Skilled Migrants

39

non-Chinese professionals, Chinese professionals have the advantage of having originated from the country. First, they have better knowledge of internal as well as the international market between China and the rest of the world, due to their experiences in the country as well as abroad. Second, compared to non-Chinese professionals, Chinese professionals who have returned have better knowledge of the Chinese culture, which in theory should assist with better integration of Chinese professionals to the local market. In summary, these features of Chinese professionals together are contributing significantly to the development of Chinese skilled migrants, especially professionals internationally as well as domestically. Increasing numbers of Chinese skilled migrants are migrating to increasingly diverse destinations globally. With the development of globalization, Chinese skilled migrants are migrating to developing economies as well as traditionally developed economies. This in turn is going to increase the global proportion of “Chinese made,” as well as a growing reputation of Chinese professionals. Chinese skilled migrants have four characteristics, which is making the study of Chinese skilled migrants the new starting point for studying new trends of international migration. These characteristics include the diverse distribution in professions, especially in new technologies, overlapping with investor migrants, increasing academic participation, and most importantly circular migration, which is against the traditional view in migration studies.

2.4

Chinese Students Overseas

Over the last decade, Chinese international students have become one of the largest groups of migrants from China. One of the possible reasons facilitating this increase might be the booming Chinese economy since the 1980s, and increasing numbers of Chinese middle class families are supporting their children to study abroad. Summarizing the data from the Ministry of Education of the P.R. China between 2009 and 2014, more than 90% of Chinese students overseas are self-funded. Subsequently, the population of Chinese students overseas increased significantly under the influence of the booming economy. Annual Report on the Development of Chinese Students Studying Abroad (2016) published by CCG showed that the population of Chinese students studying abroad were increasing at an average annual rate of 18.9% between 2000 and 2015 (Wang and Miao 2016).

2.4.1

Overview of Mobility of Overseas Chinese Students

China has become the largest source country of international students globally. The latest data reported by Ministry of Education of the P.R. China show that the number of Chinese students abroad reached 404.21 million between 1978 and

40

2

In a Different Region of the World …

Table 2.6 The number of Chinese students in major destinations in 2015 Country

Chinese students

Percentage

Ranking of Chinese students

The U.S. 30.40 31.2 1 Australia 13.60 27.3 1 Canada 8.73 32.5 1 Japan 7.78 55.9 1 The U.K. 9.29 18.8 1 South Korea 9.91 62.0 1 Singapore 5.00 – 1 Germany 3.05 10.1 2 Russia 2.50 13.4 1 New Zealand 1.55 33.3 1 Sweden 0.44 9.3 1 France 2.97 10.0 2 The Netherlands 0.66 7.3 2 Belgium 0.11 2.6 3 Switzerland 0.11 2.5 5 Unit Ten thousand people (%) Notes (1) Data for Singapore was updated in 2011; Data for Sweden and Switzerland were updated in 2012; Data for Canada was updated in 2014 (2) Except the countries of the former Soviet Union, the Ranking of Chinese Students was No. 1 in Russia

2015, of which 126.43 million are in the studying stage. In 2015, the total number of overseas students studying abroad was 523,700, an increase of 13.9% (Wang and Miao 2016). The traditional destinations, like the U.S., the U.K., Australia, Canada and so on, remained the most popular destinations for Chinese international students (Table 2.6). The high levels of education available in the countries above are one of the important reasons for Chinese students have chosen to study in these countries. The Open Doors Report 2015 by the Institute of International Education showed that 31.2% of international students studying in the U.S. are Chinese, Indian students followed in second place at 13.6% and the third was South Korea at 6.5% in 2015. Meanwhile, nearly 33% of international students in Canada are Chinese students, furthermore, Chinese students remained the largest source of international students in Canada from 2008 to 2014 (Science, Technology and Innovation Council to the Government of Canada 2015). It can clearly be seen that countries all over the world are continuing to accept large amounts of Chinese students. In recent years, the education system in China has become increasingly open, welcoming increasing numbers of Asian and European education institutions coming to China to recruit students. For example, Germany and France are offering high quality educational resources, with scholarships and potential part-time work opportunities for students. Figure 2.7 shows that the population of Chinese students in Germany has increased by 32.8% in the last five years (DZHW & DAAD 2016).

2.4 Chinese Students Overseas

(Chinese Students) 100000 18.13

41

Chinese Students in France Chinese Students in U.K. Annual Growth Rate in Germany 16.92

90000

78715

80000 70000

Chinese Students in Germany Annual Growth Rate in France Annual Growth Rate in U.K. 87895

83790

89540

15

67325

11.02 10

60000 7.04

50000 4.62

40000 30000 20000 10000

20

29122 22828 0.22 0.24

29696

1.97

23883

6.62 4.90

6.45 30349 2.20

30176

28381

30259 29709 1.87

25564 -0.57

2012

2013

2014

0

-1.55

0 2011

5

2015

-5 (Year)

Fig. 2.7 The number and growth rate of Chinese students studying in U.K., Germany and France from 2011 to 2015. Source (1) HESA (2016), (2) DZHW & DAAD (2016), (3) Institute of International Education (IIE) (2016)

The data from the Institute of International Education (IIE) showed that France received 29,709 Chinese students, which accounted for 10% of all international students in France in 2015 (IIE 2016). The number of Chinese international students in the U.K. has always been a growing trend, from 67,325 in 2011 to nearly 90,000 in 2015. Although there are overall increases, the growth rate has slowed down significantly (Fig. 2.7). The growth rate of Chinese students studying in U.K. has dropped sharply in 2013 and slipped to 1.87% in 2015. This trend may indicates that Chinese students have developed a more rational and cautious mindset regarding studying in the U.K. (HESA 2016). China has always been Germany’s largest source of students abroad and has maintained stable growth for the past five years. In 2015, the number of Chinese international students in Germany was 30,259 a growth of 6.62% from 2014 (DZHW & DAAD 2016). Moreover, China was France’s second largest source country of foreign students. The number of Chinese international students has maintained a slight increase from 2011 to 2013. At the beginning of 2014, this number started to decrease slightly. By 2015, the growth rate of Chinese international students reported a loss and the proportion fell to negative 1.55% (IIE 2016). In 2015, China was still the largest source country of international students in Japan with the number of Chinese students being 94,111 (Fig. 2.8), only a slight decline compared with 2014. As a result the significant increase in international students studying in Japan in 2015, the total number of Chinese students decreased by 45.2% this year. For a long time, due to historical issues and disputes over the sovereignty of the Diaoyu Islands, the relationship between China and Japan has

42

2 Chinese Students in Japan Annual Growth Rate in Japan

Chinese Students in South Korea Annual Growth Rate in South Korea

120000 (Chinese Students) 100000

15

13.4 12.1 97875 86173

80000

In a Different Region of the World …

87533

94399

94111

86324

8.2

10

6.7 63676

63059

60000

57798

1.6

40000

60934 53251

54345 2.1

-1.4

-1.0

0 -0.3

-3.6

20000 -8.3

-5

-7.9

0 2010

2011

2012

5

2013

2014

2015

-10 (Year)

Fig. 2.8 The number and growth rate of Chinese students studying in Japan and South Korean from 2010 to 2015. Source (1) Japan Student Services Organization (JASSO) (2015), (2) Korea Immigration Service (2016)

been a “politically cold and economically hot” phenomenon, which lead to unstable growth of Chinese students in Japan in the last five years. Such as 2012, 2014 and 2015, the number of Chinese students has seen a slight downtrend as compared with previous years. However, the number of Chinese students studying in Japan exceeded 90,000 in 2013, 2014 and 2015. Especially, in 2013, the number of Chinese students in Japan reached a record high of 97,875. According to the statistics of Korea Immigration Service (Fig. 2.8), there were 60,934 Chinese students studying in Korea by April 2015, accounting for 58.9% of all foreign students (103,509) there. However, the satisfaction of Chinese students in Korea is not high. In April 2014, the Korea Trade Association conducted a comparative survey of 562 Chinese students studying in Korea and in Japan (Oversea.huanqiu.com 2016). The results show that the satisfaction of Chinese students in Korea is much lower than that of Chinese students in Japan. Owing to discriminative treatment, 23.3% of Chinese students recommend against studying in Korea to their friends. The statistics of the Ministry of Education of the Republic of Korea also showed that there were 2000 international undergraduate students dropping out of Korea to return home in 2015, accounting for 3.4% of the total.

2.4 Chinese Students Overseas

43

2.4.2

Development Trends of Overseas Chinese Students

2.4.2.1

Changing Trends of Chinese Students

Together with increasing numbers of Chinese students studying abroad, the degree chosen and age they are left the country for their studies is showing a changing trend. The first changing trend are choices taken by students between bachelors and master’s degrees. In the U.S., for instance, the growth rate of Chinese students in the undergraduate level was significantly faster than that of Chinese postgraduate students during 2009–2016 academic years, the percentage of China’s university graduates going the U.S. to do postgraduate work has been declining, while Chinese students studying in the U.S. for bachelor degrees were increasing (Fig. 2.9). In 2014–2015 academic year, specially, the number of Chinese undergraduate students for the first time exceeded the amount of Chinese postgraduate students studying in the U.S., of which 124,552 Chinese undergraduates, an increase of 12.7% compared with the previous academic year, and 120,331 Chinese postgraduates, an increase of only 4% from the previous academic year. Other than universities, the number of Chinese students in high schools abroad is also on the increase. According to a joint survey by CCG and MyCOS, the proportion of Chinese students studying abroad after finishing domestic high school courses dropped from 61 to 44%, and the proportion of Chinese students studying high school abroad rose from 17 to 27%. Over one-third of Chinese students plan to go abroad to study high school or matriculation or language schools, which means that most of the students will not participate in China’s college entrance examination, and will not choose to study in domestic high schools. In recent years, for example, tens of thousands of students from mainland China flew to Hong Kong for the SAT (Scholastic Assessment Test). As shown in Fig. 2.10, the top three destinations for the young Chinese students to study high school abroad remains Canada, the U.S. and Australia between 2007 and 2014. Even as the data from Student and Exchange Visitor Information System (SEVIS) showed the number of overseas Chinese students enrolled in high school with F-1 international student Fig. 2.9 Comparison of Chinese undergraduate and postgraduate students studying in the U.S. from 2009 to 2016. Source Institute of International Education: Open Doors (2010, 2011, 2012, 2013, 2014, 2015, 2016) Report

60

52.1

50

Undergraduate 48.8

45.6

Postgraduate

43.9

42.2

39.8

40.3

41.0

41.3

40 30

36.2

38.4

31.3 20 10 0

(Academic year)

39.6

37.5

44

2

Fig. 2.10 Distribution of young Chinese students to study high school abroad between 2007 and 2014. Source EIC Education (2014)

In a Different Region of the World …

Canada

31.85

The U.S.

30.58

Australia

22.16

The U.K.

7.59

Other European Countries

3.50

Singapore

2.68

New Zealand

1.98

Japan

1.19

South Korea

0.17 0

10

20

30

40 (%)

visa in the U.S. increased from 433 to 4.3 million between 2004 and 2015, the growth was nearly a hundred times during 11 years (U.S. Immigration and Customs Enforcement 2016). The increasing numbers of Chinese students admitted to high schools rather than universities implied that the age of the Chinese students start studying overseas is getting younger. Further evidence according to the survey of students who are planning to study abroad, from 2015 White Paper of China’s Study Abroad, showed 29% of interviewees are interested in studying abroad in secondary schools, and 59% of interviewees are interested in undergraduate degrees abroad (Wang and Miao 2015). It can be seen that Chinese students are increasingly studying overseas at a younger age, but university study is still the mainstream chosen by Chinese students as the education industry becomes more globalized. The number of very young Chinese receiving schooling in overseas countries has risen significantly, while their destination countries have become more varied.

2.4.2.2

Performance of Chinese International Students

A majority of Chinese students studying abroad are those who performed well when they were in Chinese schools. Therefore, in 2013, CCG surveyed students from five different middle schools in Beijing about studying abroad (Wang and Miao 2014a, b). Results showed that more than two-thirds of Chinese students studying abroad were those who performed well in class, the so-called “top students.” As shown in Fig. 2.11, among the 1000 students surveyed for the research, more than 60% of Chinese students planning to study abroad are those that performed in the top 25% of the class. On the contrary, only 2.3% of Chinese students that performed below 75% of the class have plans of studying abroad. The Chinese Young Students Studying Abroad Research Report further found that 70% of Chinese international students previously won at least one award for their achievements in Chinese high schools or colleges, nearly 5% of the students

2.4 Chinese Students Overseas

45

Performance 26%~50%, 21.60%

Performance 51%~75%, 8.0%

Performance top 25%, 68.2% Performance 76% & under, 2.3%

Fig. 2.11 Performance of Chinese Students in high school before going abroad. Source Investigation of CCG on high school students going abroad between February and June 2013

received national awards, 25.8% were previously awarded provincial or municipal level awards, and 63.3% district or school level awards. All this evidence refutes the previous argument, that “only those who can’t learn well go abroad” (EIC Education 2014).

2.4.2.3

Diverse Choice and Disciplines

For a long time, FAME (Finance, Accounting, Administration and Economics) and STEM (Science, Technology, Engineering and Mathematics) have been the most popular specialties for international students, mainly because these professional graduates have an extensive employment outlook and a generous remuneration. For instance, Table 2.7 shows that Chinese international students predominantly focus on Business of FAME and Engineering of STEM in the U.S., of which the Top 3 disciplines chosen by Chinese students were Business Administration at 24.3%, Engineering at 18.6%, and Mathematics and Computer Science at 14.1% (Institute of International Education 2016). However, the choices of disciplines by Chinese international students are becoming increasingly diverse. Report of the Social Demand of Chinese University Graduates and Their Quality 2010–2015 published by MyCOS showed that Business Administration as a popular subject to take abroad and the proportion of students who chose this subject studying abroad dropped from 45.1% in 2010 to 27% in 2015, a decrease of 18 percentage points. At the same time, there were 42.1% of the undergraduate students studying STEM abroad in 2015, which is decreasing compared with 2014 (Wang and Miao 2016). The situation indicated that a series of preferential policies (such as immigration policy etc.) in the destination country were not the only requirement as their own subject selection for studying abroad. The subject selection of undergraduate students in 2015 showed a

46

2

In a Different Region of the World …

Table 2.7 Distribution for Chinese students’ major in the U.S. from 2010 to 2016 Academic year Business Administration Engineering Math and Computer Science Physics/Life Science Social Science Art and Applied Art Health Care Education Humanities Unit (%) Source Institute of

2010–2011

2011–2012

2012–2013

2013–2014

2014–2015

2015–2016

27.5

28.7

29.0

28.0

26.5

24.3

19.2 10.6

19.6 11.2

19.2 11.2

19.8 11.5

19.7 12.4

18.6 14.1

11.5

9.9

8.8

8.9

8.9

8.7

7.0 3.4

7.7 3.8

8.2 4.9

8.1 5.3

7.8 5.6

8.7 6.5

2.0 2.1 1.2

1.5 1.7 1.3

1.3 1.7 1.0

1.4 1.7 0.9

1.4 1.7 0.9

1.3 1.7 1.0

International Education: Open Doors (2011, 2012, 2013, 2014, 2015, 2016) Report

new trend of increasing the quantity of Chinese students in various disciplines, such as in the social sciences, foreign language literature, pedagogy, architecture, communication and journalism. There were many reasons for this, one of them being the intensified competition in the job market for FAME and STEM graduates. Considering their future of employment factors in order to avoid the competition, many have changed in subject selection from Finance, Business Administration to a broader career prospects. Currently the domestic market has a need for high-end services, luxury goods and art talent, which has led to increasing students choosing to study in countries which are developed in these areas. The evidence suggests that factors influencing their decision-making regarding studying abroad and choices of subjects are also based on a rational understanding of the contemporary Chinese market. The employment prospect may surpass their interests to become the most important consideration. Hopefully, the more flexible career path for Chinese students studying abroad would be paved with the interrelationship between FAME, STEM and other subjects. Meanwhile, it might also be the result of increasing information of studying abroad becoming available as the Chinese government is working towards further integration with the world. As the Chinese economy is increasingly integrated internationally through trade and more, the levels of information available for Chinese students who have intensions to study abroad also increase. Therefore, Chinese students have more clear information about schools/universities abroad, and disciplines available for application. As ranges of subjects other than FAME and STEM are becoming available, Chinese students might be simply responding to the wide range of disciplines according to the increasing levels of information available.

2.4 Chinese Students Overseas

2.4.3

47

Factors Influencing Chinese Students

In recent years, with increasing numbers of Chinese international students, choices made for studying abroad are becoming increasingly diversified and rational. For example, the choices of countries are becoming increasingly widespread internationally, and fields of studies increasingly diversified; further, there is evidence to suggest that Chinese students abroad left the country with long-term planning, and diverse purposes. The following section will discuss the potential factors that are influencing the decision making process for Chinese international students studying abroad.

2.4.3.1

Reasons of Studying Abroad

There are multiple reasons Chinese students choose to study abroad. Report of the Social Demand of Chinese University Graduates and Their Quality 2012–2015 published by MyCOS showed that the top three reasons include improving their comprehensive career competitiveness, accessing higher quality education, and learning advanced science and technology (Wang and Miao 2016). These three reasons are all for the students’ own development and to enhance their competitiveness, which shows the strategy of undergraduate students studying abroad. Factors such as improving their knowledge and understanding different foreign cultures, or employment and immigration are also influential in the decision-making process. In weighing the decision process of undergraduate students studying abroad, the influence of factors such as the overall quality of education, the difficulty of application and the degree of immigration convenience is significant in the universities of destination countries. According to Report of the Social Demand of Chinese University Graduates and Their Quality 2012–2015, the overall quality of postgraduate education has an obvious effect on the decision-making of undergraduates studying abroad, especially in North America. Up to 86.5% of undergraduate students consider this the most important reason for studying abroad, more than twice the ratio than those who choose to study in Asia and Oceania. Moreover, 32.9% of undergraduate students studying in Oceania considered the environment as an important issue when making their decision in 2015, it also shows that Oceania universities are relatively easy to apply to. In addition, the convenience of immigrants has become an important consideration for the decision-making of undergraduates, especially under the rising immigrant trend, undergraduate students studying in Oceania have a much higher consideration for immigration than other regions, and the tuition factor is also an important consideration for the undergraduate students studying in Asia.

48

2.4.3.2

2

In a Different Region of the World …

Sources of Information

Whereas in the past Chinese students may have only utilized a single source of information to determine where they should immigrate to study, but more recently they are getting their information from an increasing number of sources. This is due to the continuous development of the Internet and other communication technologies. The increasingly diverse sources of information and wider information about studying abroad made available are reasons contributing towards changes happening regarding Chinese undergraduate students studying abroad. Due to how application systems are being extensively utilized by foreign educational institutions, and students are now able to obtain detailed and accurate information crucial for a smooth study abroad. Report of the Social Demand of Chinese University Graduates and Their Quality 2012–2015 published by MyCOS showed that 38.3% of undergraduate students studying abroad selected “Domestic intermediary agencies” as the preferred channel of information with 28.2% of them choosing the “Foreign university website” as the main source for information in 2015 (Fig. 2.12). On the one hand, domestic intermediary agencies are becoming more and more user-friendly, and improved service standardization, along with streamlined processing, also have a certain attraction to students. On the other hand, the content of foreign university websites are authoritative, updated in a timely fashion, and the undergraduate students can access information without language barriers. It is noteworthy that “Foreign university seminars in China” are relatively unaware of the undergraduates, but the status of “Cooperative universities of domestic schools” increase gradually in the students’ access to information channels, which may be more relevant to the propaganda orientation of the cooperative institutions and more associated with the actual situation of domestic cooperative CooperaƟve universiƟes of domesƟc schools, 9.7% DomesƟc intermediary agencies, 38.3%

Foreign university seminars in China, 1.4% Foreign university website, 28.2%

DomesƟc Studying abroad website, 8.5%

RelaƟves and teachers' recommendaƟon, 13.9%

Fig. 2.12 Distribution of information-acquiring channels for Chinese undergraduate students in 2015. Source MyCOS (2015)

2.4 Chinese Students Overseas

49

institutions. In addition, the impact of social relations cannot be underestimated. “Relatives and teachers’ recommendation” is also the most important sources of information channels, accounted for 13.9% (Fig. 2.12). To sum up, increasing numbers of Chinese students are choosing to study abroad. Multiple factors are contributing to such an increase both domestically and internationally. First, the increasing amount of information regarding studying abroad is being made available to Chinese students through multiple sources. Availability of such resources provided the foundation for the recent development of the present amount of international Chinese students. As more information becomes available, the choices of destinations become more diverse for Chinese students, choices of degrees as well as disciplines available also increase beyond FAME and STEM. Meanwhile, influenced by the rapid economic development in China in recent years, increasing numbers of Chinese families are able to financially support their children studying abroad. These two factors together set the important foundation for the large number of Chinese students studying abroad.

2.5

Concluding Remarks

There is a comprehensive geographic distribution of Chinese overseas emigrants in the world. While the U.S., Canada, Australia, New Zealand are major destination countries, European, Asian, Latin American, African and the South Pacific Island countries have become popular destinations for Chinese emigrants in recent years as well. A wide range of new features can be found from in following aspects: China in 2015 has become the fourth largest source country of migration in the world; the number of investment migrants from China has increased significantly; new groups of migrants such as educational migrants and blue-collar migrants are emerging. However, all of these development have expanded China’s migrant deficit. The growing outflow of Chinese emigrants and changes in immigration policies in some major receiving countries and regions are presenting severe challenges to China. It is necessary to take effective measures to respond to these challenges in order to ensure talent security and socioeconomic development in China.

References Australian Government Department of Immigration and Border Protection (DIBP) (2014) Annual report 2013–2014, p 36. Available at: http://www.border.gov.au/ReportsandPublications/ Documents/annual-reports/DIBP_AR_2013-14.pdf#search=Annual%20Report%202013% 2D14 Australian Government Department of Immigration and Border Protection (DIBP) (2016) Australia’s Migration Trends 2014–2015. Available at: http://www.border.gov.au/ ReportsandPublications/Documents/statistics/migration-trends-14-15-full.pdf

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2

In a Different Region of the World …

China.com (2017) Chinese landlord buy a house for rent in U.K., rent has Risen 600 Pounds for half a year, 13 Mar. Available at: http://finance.china.com/news/11173316/20170313/ 30321912.html DZHW & DAAD (2016) Wissenschaft Weltoffen Kompakt 2016. Available at: http://www. wissenschaftweltoffen.de/kompakt/wwo2016_kompakt_en.pdf EIC Education (2014) The Chinese young students studying abroad research report. Available at: http://www.eic.org.cn/special/eic_research_report_2014/ Essential Science Indicators (ESI) (2010) Available at: http://wokinfo.com/products_tools/ analytical/essentialscienceindicators/ Eurostat (2016) Key figures on enlargement countries-2017 edn, 22 Dec. Available at: http://ec. europa.eu/eurostat/documents/3217494/7774688/KS-GO-16-001-EN-N.pdf/26107237-ec5d4b1e-87f2-7bac279fb00a Federal Office for Migration and Refugees (2016) Figures on the EU blue card, 30 Nov. Available at: http://www.bamf.de/EN/Infothek/Statistiken/BlaueKarteEU/blaue-karte-eu-node.html Government of Canada (2014) Supplementary information to the 2014 immigration levels plan. Available at: http://www.cic.gc.ca/english/department/media/notices/2013-11-01.asp Government of Canada (2016) Express entry year-end report 2015. Available at: http://www.cic. gc.ca/english/resources/reports/ee-year-end-2015.asp HAYS (2013) Hays global skills index 2013. Available at: https://www.hrportal.hu/download/ Hays_GSI_2013_Poster.pdf HESA (2016) Statistical first release 224. Available at: https://www.hesa.ac.uk/dox/pressOffice/ sfr224/061046_student_sfr224_1415_table_9 Institute of International Education (IIE) (2016) Project Atlas: International Students in France (2015–2016). Available at: https://www.iie.org/en/Research-and-Insights/Project-Atlas/ Explore-Data/France Inter-American Dialogue (2016) China’s investment in latin America doubled by USD $29 Billion in 2015. Available at: http://china.huanqiu.com/News/mofcom/2016-02/8565190.html Japan Student Services Organization (JASSO) (2015) Result of an Annual Survey of International Students in Japan 2015. Available at: http://www.jasso.go.jp/en/about/statistics/intl_student_e/ 2015/index.html Korea Immigration Service (2016) April. Available at: http://www.immigration.go.kr/doc_html/ attach/imm/f2016//20160527256544_1_1.hwp.files/Sections1.html Ministry of Commerce of the People’s Republic of China (2007) Interim measures for the administration of overseas investment in insurance funds. Available at: http://www.mofcom. gov.cn/aarticle/b/g/200709/20070905081180.html MyCOS (2015) Report of the social demand of Chinese University graduates and their quality 2012–2015 National Bureau of Statistics of the P.R. China (2016) Statistical bulletin of China’s foreign direct investment 2015, 28 Nov. Available at: http://www.stats.gov.cn/tjsj/tjcbw/201611/t20161128_ 1434603.html NetEase (2013) Report on the trend of Chinese overseas property buyers 2012, 1 Mar. Available at: http://sh.house.163.com/13/0301/07/8OS5V52300073SDJ.html Oversea.huanqiu.com (2016) Korean media worried that Chinese students hate South Korea: two percent do not recommend relatives and friends to Korea, 21 Mar. Available at: http://oversea. huanqiu.com/article/2016-03/8741669.html Productivity Commission of Australian Government (2016) Migrant intake into Australia, 12 Sept. Available at: http://www.pc.gov.au/inquiries/completed/migrant-intake/report/migrant-intakereport.pdf Science, Technology and Innovation Council to the Government of Canada (2015) State of the nation 2014—Canada’s science, technology and innovation system. Available at: http://www. cirb-ccri.gc.ca/eic/site/stic-csti.nsf/vwapj/STIC_1500_SON_Report_e_proof4.pdf/$file/STIC_ 1500_SON_Report_e_proof4.pdf Tencent Finance and Economics (2016) China’s capital invested USD $30 billion in real estate overseas in 2015, 6 Mar. Available at: http://finance.qq.com/a/20160306/013695.htm

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The Financial Times (2015) China’s investment in Africa dropped, 26 Oct. Available at: http:// www.ftchinese.com/story/001064523 The National Bureau of Economic Research (2016) The cost of low fertility in Europe. Available at: http://www.nber.org/digest/jul09/w14820.html The People’s Bank of China (2016) RMB is officially included in the SDR currency basket, 1 Oct. Available at: http://www.pbc.gov.cn/goutongjiaoliu/113456/113469/3154426/index.html United Nations Department of Economic and Social Affairs (DESA) (2013) International migration 2013 Wallchart. Available at: http://www.un.org/en/development/desa/population/ migration/publications/wallchart/docs/wallchart2013.pdf U.S. Citizenship and Immigration Services (USCIS) (2016) EB-5 immigrant investor program. Available at: https://www.uscis.gov/eb-5 U.S. Department of State (2015) Visa statistics—report of visa office (2000–2015). Available at: https://travel.state.gov/content/Visas/en/Law-and%20Policy/Statistics.html U.S. Homeland Security Department (2016) Retention of EB-1, EB-2, and EB-3 immigrant workers and program improvements affecting high-skilled nonimmigrant workers, 18 Nov. Available at: https://www.federalregister.gov/documents/2016/11/18/2016-27540/retention-ofeb-1-eb-2-and-eb-3-immigrant-workers-and-program-improvements-affecting-high-skilled U.S. Immigration and Customs Enforcement (2016) Student and exchange visitor program (SEVP), student and exchange visitor information system (SEVIS), July. Available at: https:// www.ice.gov/sites/default/files/documents/Document/2016/SEVP_SBTN_JUL2016.pdf Wang HY, Miao L (2014a) Report on overseas Chinese professionals (2014). Social Sciences Academic Press (China), pp 21–28 Wang HY, Miao L (2014b) Annual report on the development of Chinese students studying abroad (2014). Social Sciences Academic Press (China), pp 26–28 Wang HY, Miao L (2015) Annual report on the development of Chinese students studying abroad (2015). Social Sciences Academic Press (China), p 22 Wang HY, Miao L (2016) Annual report on the development of Chinese students studying abroad (2016). Social Sciences Academic Press (China), pp 12–52 Wang XM, Tang YH, Zhang ZQ, Gao F (2010) Analysis of international academic influence of the excellent Chinese scientists based on bibliometrics. J Intell 29(12):5–9 Wang HY, Liu GF, Miao L (2015) Annual report on Chinese international migration (2015). Social Sciences Academic Press (China), pp 96–108

Chapter 3

Reverse Migration in China: Contemporary Chinese Returnees

3.1

Introduction: Contemporary Chinese Returnees

Since the onset of the 2008 Global Economic Crisis, developed countries have seen large numbers of the highly educated and skilled immigrants (and their families, including children) who had left emerging economies like India, China, Russia, and Brazil returning to their home countries. This phenomenon is referred to as the “reverse brain drain.” Returning migrants, who once went abroad in search of greater opportunities, are being lured back to their home countries by their high rates of economic growth. Some scholars argue that as the reverse migration trend intensifies, the “brain drain” is being transformed into a “talent flow” (Carr et al. 2005). Schler and Jackson (1987) puts forward a theory of “brain circulation,” arguing that the reverse brain drain only implies a one-way movement of global talent. Brain circulation, by contrast, reflects the circular aspects of this movement, which benefit both the countries of origin and destination of migrating talent. Drawing upon case studies of Israel, Taiwan, India and China, Saxenian (2002a, b, 2006) argues that the circulation of entrepreneurial and technological returnees has provided benefits for the countries of origin of these immigrants. She shows that returnees who have developed their careers abroad play an important role in driving economic development in their home countries by bringing back human, financial and social capital. To take full advantage of the new “circulation” phenomenon with respect to globally talented workers, many countries, including China, are developing innovative talent programs aimed at luring immigrants back home. These returnees constitute a cadre of highly trained and qualified people combining overseas education and valuable global experience with extensive local knowledge and social resources in their host countries (Tung and Lazarova 2006). In 2006, China issued its Medium and Long-Term Talent Development Plan (2010–2020), which seeks to

© Springer Nature Singapore Pte Ltd. 2017 L. Miao and H. Wang, International Migration of China, DOI 10.1007/978-981-10-6074-8_3

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3 Reverse Migration in China: Contemporary Chinese Returnees

expand the country’s team of innovators and cultural elites in order to transform it into an “innovation society.” In line with this overall plan, the Chinese Government has successively launched a series of talent programs. These include The Thousand Talents Program and The Thousand Youth Talents Program, which were launched in 2008 and 2011, respectively, and sought to recruit “innovative” talent living abroad. This effort was especially targeted at overseas Chinese studying in foreign countries and was aimed at encouraging them to return to work for their homeland. The Thousand Talents Program aims to attract about 2000 leading talented individuals under the age 55, who hold professorships or equivalent positions in renowned foreign universities or research institutes over a period of 5–10 years. The Thousand Youth Talents Program plans to lure about 2000 distinguished young overseas scholars under the age 40 back to China by 2015. The biggest contribution these individuals have made is bringing back advanced technology. In particular, the advanced computer sciences, optical-electronic technologies, aeronautics and astronautics that they have introduced to China from their time living abroad have greatly shortened the distance between China and developed countries in such areas, especially during 1980s and the start of 1990s (People’s Daily 2007). The influence of returnees extends far beyond sciences and technology. The advanced management concepts and international visions that they learned abroad have accelerated the pace of China’s economic globalization. In addition, they also serve as bridges, enhancing mutual understanding between the Chinese and people in the rest of the world.

3.2

Survey on Contemporary Chinese Returnees: Employment and Entrepreneurship Traits

Since 2000, while the number of overseas students has substantially increased, the number of such students returning to China after completing their studies has recently reached new records. According to Chinese Ministry of Education, in 2015, 523,700 Chinese went overseas for study, an increase of 13.9% compared to 2014. At the same time the amount of returnees was 409,100, an increase of 12.14% compared with the 2014s figure of 364,800. Of the 4.04 million students who have gone abroad since 1978, 2.22 million, or over a half of them have returned. This marked and steady increasing return rate stems mainly from government efforts, the financial crisis abroad, China’s buoyant economy, and increasing optimism on the part of Chinese who have gone abroad to study about their job prospects back home. The 2008–2009 global financial crisis and subsequent stagnant growth in the world economy had led to significant cutbacks government support for scientific and technological research in developed economies. By contrast, China continues to increase spending on science and technology development. Thus, while the global financial crisis can be viewed as a “push” factor driving the trend of growing numbers of returnee students, government measures

3.2 Survey on Contemporary Chinese Returnees …

55

like The National Medium- and Long-term Talent Development Plan (2010–2020), serve as a “pull” factor by offering returnees tax breaks, housing subsidies, and assistance in resettling spouses and children. At the same time, ongoing high unemployment in the Euro zone and, until recently, in the U.S., has further contributed to the trend of Chinese students returning to their motherland after studying abroad. Moreover, growing numbers of overseas Chinese have returned to China to start new business ventures since 2000. Two-thirds of the returnees want to start or have already set up their own businesses. Over 80% of returnee entrepreneurial firms were founded after 2006, with 27.6% of returnees establishing their own businesses in 2011 alone. These encouraging numbers indicate that China has now entered a period when it has more returnee entrepreneurs operating in the country than during any other time in its modern history. Indeed, as recently as 20 years ago, returnee entrepreneurs did not even exist. Returnees have started their business in many sectors, particularly in areas like new technologies, the internet, telecommunications, and media. In carrying out this activity, they have also stimulated traditional industries. Businesses created by returnees are now part of the mainstream of the new Chinese economy, especially in high-tech areas. By the end of 2010, China had built 150 entrepreneurial parks for returnees, and over 10,000 new firms have settled in these parks. Statistics show that there are already 21 such parks for returnee entrepreneurs in the Zhongguancun Science and Technology Zone, Beijing, which is known as China’s Silicon Valley. Some 3888 firms started by returnees have registered in the zone with a total registered capital of RMB 4.5 billion. Some 57% of returnee entrepreneurs have their own scientific achievements, and 44% of these achievements have led to patents. To sum up, armed with overseas education and global experience, returnees have been seen as being unique with respect to having a foot in two different worlds. They know their home countries very well, but also understand the outside world. These individuals can leverage their unique dual identity to build up news business ventures. In particular, by being “first through the door,” smart returnees may get a step ahead of the curve with bi-cultural identity, stronger technological ability, and greater access to resources.

3.2.1

Survey on Chinese Returnees

From the end of 2011 to early 2012, in cooperation with Guanghua School of Management, Peking University, Center for China & Globalization (CCG) conducted both online and offline surveys regarding the entrepreneurial activities, employment, and innovation contributions of returnees. An online survey questionnaire was sent to 2642 persons based on WRSA membership data. This sample was not random, but rather selected. Respondents who took part in the survey had to meet the following criteria: before returning to China, they had to

56

3 Reverse Migration in China: Contemporary Chinese Returnees

have studied in the host countries full time as an undergraduate or graduate student and/or worked in there for at least one year. The online survey was sent to the selected population via email to be returned online. We obtained 356 valid questionnaires, so the response rate was 13.5%. The offline survey was conducted during the 2011 Convention of Overseas Chinese Scholars in Science and Technology in Guangzhou. During that meeting, we got 143 valid questionnaires. Altogether, then, we obtained 499 valid questionnaires.

3.2.1.1

Motivation for Returning to China

Our survey results show that the top two reasons for those in the Chinese diaspora to return to the Mainland are greater economic opportunities and career development. We also find that the return rate is closely associated with the shifting fortunes of the Chinese and overseas economies. Since 2008, Western economies have struggled with slumping growth and rising unemployment. Meanwhile, China’s economy has experienced relatively strong growth, while its government has instituted many preferential policies to encourage overseas students to return home. Based on the previous studies, we classify the factors affecting the decision of returning to China into three categories. They are career development, family ties, and social and cultural identity, respectively. Table 3.1 lists each of the three factors and their facets. On the level of overall factors, 58.8% of respondents cited career development as the major reason for returning to China, 45.1% chose family ties, and 41.2% social and cultural identity. In terms of career development issues, “have comparative advantage in a professional field,” “optimistic domestic economic outlook,” “exploit opportunities in domestic market,” and “attractive preferential policies” are the top four factors luring returnees back home. However, less than Table 3.1 Factors affecting overseas Chinese’s decision of returning to China and their respective facets Factors

Career development

Family ties

Social and cultural identity

Facet 1

Have comparative advantage in a professional field Optimistic domestic economic outlook

To be united with family and friends

Feel more comfortable in Chinese cultural environment

Life is more comfortable and stable in China Tired of boring overseas life –

Patriotism and China’s stable political pattern

Facet 2

Facet 3 Facet 4 Facet 5 Facet 6

Exploit opportunities in domestic market Attractive preferential policies Career bottleneck Lack proper career opportunities

– –

Have strong domestic social network Difficult to integrate well into foreign society Feel sense of discrimination Failed to obtain overseas national identity card and lacking social security

3.2 Survey on Contemporary Chinese Returnees …

57

35% of the respondents returned to China because their career development encountered bottlenecks. And only around 25% returning to China did so because of problems in finding a proper job opportunity. Chinese leave China for better economic and professional opportunities in developed countries and return to China with advanced technology and skills for the same reason. What was a brain drain that is advantageous to developed economies has been reversed for the long-term benefit of China. Over 70% of respondents cited the desire to be back with their families as the main reason leading them to return to China. However, only around 35% of respondents selected the comfort and stability of life in China as their main rationale for coming back. An even smaller share, 30%, said that boredom with living overseas drove them back to the Mainland. This last result may reflect the fact that most of the respondents were between the ages of 30 and 40 (Fig. 3.1). These individuals go back to China for the purpose of seeking opportunity and wealth, rather than enjoying pleasure. China’s culture and stable political environment seem to be another two important factors drawing Overseas Chinese back home. Over 60% of respondents cited these two factors as causing them to return to China. However, life stress, loneliness, discrimination issues, and intense intercultural challenges and struggles did not play a significant role in affecting decision of moving back to China. This finding reflects the fact that patience and perseverance are two important Chinese cultural traits. To most Chinese, it is a virtue to survive the demands of a different

Reasons for returning to China 90 80 70 60 50 40 30 20 10 0

Fig. 3.1 Distribution of reasons for returning to China

58

3 Reverse Migration in China: Contemporary Chinese Returnees

learning and living environment and to adapt, develop and achieve under difficult and demanding circumstances. Figure 3.1 shows the distribution of the reasons driving overseas Chinese back. Lee’s “Push-pull” theory (1966) divides the factors causing migration into “push” and “pull” categories. Push factors basically involves adverse living conditions in the migration source countries—lack of jobs, limited opportunities, and loss of wealth–that make people want to move elsewhere. Pull factors are things that attract migrants to another area, such as “job opportunities,” “better living conditions,” “enjoyment,” and “family links.” Our survey shows that Chinese returnees are more driven by the pull factors than the push factors. Both the central and local governments in China have recently shown great interest in attracting overseas Chinese talent. The Thousand Talents Program launched by the Chinese Government represents the latest effort to make China more competitive in the global hunt for top-notch talent. As of summer 2011, 2100 people had returned under this program. While the central government continues to place the highest value on luring back scientists and engineers in order to boost China’s innovation and competitiveness. Other types of talent-senior managers in multinational corporations and banks and technopreneurs who have developed their own patents or technology—are also being targeted by various talent schemes. The best known example is Beijing’s Zhongguancun Science and Technology Park, which has established 25 incubation centres. By the end of 2011, Zhongguancun incubation centres had attracted 5000 companies with over 12,000 returnee entrepreneurs. Among the returnee Zhongguancun entrepreneurs, more than 44% have obtained patents. Competition among Chinese cities has also grown to lure top-notch talent from abroad. Beijing, for example, has established a number of schemes promoting returnee entrepreneurship. In December 2008, it set up an Overseas Students and Scholars Service Centre to help recruit overseas Chinese. Shanghai initiated China’s first talent scheme as early as 1992. It is now competing for global talent through the “10,000 Overseas Returnees Cluster Project,” which has attracted more than 20,000 overseas returnees who created over 4000 new business ventures. Large cities in coastal regions are much better positioned than other Chinese metropolises to attract overseas returnees. Among an estimated total of 300,000– 400,000 returnees, about 100,000 have chosen to live in Beijing, 70,000 in Shanghai, 30,000 in Guangzhou, Shenzhen and other Pearl River Delta cities. By contrast, 100,000 are residing in provincial capital cities and another 50,000– 100,000 returnees have settled down in more remote counties. In the long run, attracting overseas Chinese talent back is just the first step. The crucial issue is devising ways of ensuing that they stay in China. Many returnees find adapting to life back in their motherland to be much harder than they had imagined. Some of the returnees subsequently decided to go abroad again, on account of China’s environmental, food safety, and educational problems.

3.2 Survey on Contemporary Chinese Returnees …

3.2.1.2

59

Different Career Choices

Some 77.6% of the survey respondents had work experience overseas. On average, our respondents had lived overseas as professionals for 6.3 years. Among them, 27.2% had professional experience in the IT Industry, 20.8% in a university or research institute, and 13.6% had worked in biotechnology or pharmaceutical sectors (Fig. 3.2). The survey also shows that 29.4% of our respondents have overseas entrepreneurship experience. Among such individuals, 35.6% had started IT ventures; the next two most popular business ventures were biotechnology and pharmaceuticals (20.1%) as well as service-oriented companies (18.8%) (Fig. 3.3). Our respondents’ overseas work or entrepreneurship experience was concentrated in the high-tech and knowledge-based service industries, which is likely a result of China’s efforts in developing a low-carbon economy, with aim of reducing greenhouse emissions and actively promoting Science and Technology (S&T). The State Council of China approved the Torch Plan in 1988, aiming to establish New High Tech Development Zones (Gao Xin Jishu Kaifa Qu) in cities around China. The Chinese government also launched specific policies to link returnees and technology. For instance, the “Medium- to Long-Term Plan for the Development of Science and Technology” which was initiated by the Chinese government in 2008, designated biotechnology as a key sector for the overall development of high-tech industry in the country. Our survey results partly show the effects of the relative policies and programs on returnees. Whether to seek employment or try to start one’s own business is one of the most important questions that returnees face when thinking about and deciding to come back to their home country. We found that 67.5% of the respondents either have already established their own firms or plan to do so, while 32.5% never considered starting their own venture. Since most of our respondents had stayed

agriculture industry new energy vehicle industry aerospace industry environmental protecƟon industry cultural and creaƟve industry municipal public uƟliƟes hign-end equipment manufacturing inustry manufacturing industry new energy industry new material industry sevice industry biological enineering and pharmaceuƟcal industry university and research insƟtuƟon next generaƟon informaƟon technology industry 0.00%

1.00% 1.00% 1.30% 2.10% 2.80% 2.80% 3.30% 3.60% 5.40% 5.60% 9.50% 13.60% 20.80% 27.20% 10.00%

20.00%

DistribuƟon of overseas prefessional experience of returnees

Fig. 3.2 Overseas professional experience pyramid of returnees

30.00%

60

3 Reverse Migration in China: Contemporary Chinese Returnees

municipal public uƟliƟes

1.30%

university and research insƟtuƟon

1.30%

manufacturing industry

1.30%

new energy vehicle industry

1.30%

agriculture industry

2.00%

cultural and creaƟve industry

2.00%

environmental protecƟon industry

2.70%

high-end equipment manufacturing industry

3.40%

new energy industry

3.40%

new material industry

6.70%

sevice industry

18.80%

biological engineering and pharmaceuƟcal industry next generaƟon informaƟon technology industry 0.00%

20.10% 35.60% 10.00%

20.00%

30.00%

40.00%

DistribuƟon of overseas professional experience of returnee entrepreneurs

Fig. 3.3 Overseas professional experience pyramid of returnee with entrepreneurship experience

overseas for more than 5 years, they have been strongly influenced by western entrepreneurial capitalist culture and the spirit of entrepreneurship. Moreover, being embedded in multiple cultures as well as overseas and local networks provides the returnee entrepreneurs advantages that their local counterparts may lack. The economic development model of China, which has up till now largely been fueled by cheap labor and inexpensive manufacturing, is changing. The government is paying special attention to the growth of entrepreneurship, adopting new policies aimed at promoting returnee entrepreneurship and attracting high-tech entrepreneurs back home. For example, both the national government and municipal authorities have announced a variety of schemes-cash awards of up to RMB 500,000, three-year tax exemption, free rent on business premises and other preferential policies-to promote returnee entrepreneurship. In addition, peer influences may play an important role in understanding why the majority of the returnees plan on becoming entrepreneurs after coming back home. A large number of returnee entrepreneurs have achieved prominence beyond commercial success, such as Robin Li, the CEO of Baidu.com. Their achievements have surely influenced other returnees’ perceptions about entrepreneurship as a career choice.

3.2 Survey on Contemporary Chinese Returnees …

3.2.1.3

61

Factors Hindering Overseas Chinese from Returning to China

While the number of Chinese students returning from overseas has increased dramatically, a large number of overseas Chinese students, especially those receiving Ph.D.s in the U.S., still plan to remain in their receiving countries. According to data from Chinese Ministry of Education, over 68% of Chinese students did not intend to return to China. We therefore are keen to investigate the factors contributing to the decision of overseas Chinese not to return to their homeland. We separate these factors into four categories: “Social Culture,” “Policy and Regulation,” “Domesticity,” and “Career Development.” Table 3.2 lists each of the four factors and their respective facets. We find that the differences between the value systems of Western Countries and China, especially the former’s emphasis on humanistic ideals and rule of law, are the main factors making overseas Chinese reluctant to return to China. Moreover, high real estate price, smaller living spaces, pollution, noise, and traffic jams found in most large cities in China may all negatively influence overseas Chinese when it comes to deciding to move back. On a factor level, 76.9% of the respondents cited “social culture” as an important hindering factor, 69.9% chose “policy and regulation,” while 67.2 put down “domesticity” and “career development.” The moral values of social distance and reciprocity are of central importance to Chinese culture and organizational behavior. Social distance (Akerlof 1997), the relational closeness of the interacting parties, is often reflected in the indigenous concept of “guanxi” in Chinese culture. Guanxi refers to interpersonal ties rooted in common background and experience that facilitate exchange (Tsui and Farh 1997). Reciprocity exchanges are the key factor to maintaining one’s guanxi web. Pearce and Robinson (2000) believe that the Chinese top-down political system makes government guanxi particularly important for business success. A 2010 poll in People’s Daily showed that 91% of respondents believed that rich people enjoy Table 3.2 Factors hindering overseas Chinese from returning to China Factors

Social culture

Policy and regulation

Domesticity

Career development

Facet 1

Guanxi and reciprocity exchange in Chinese society Low level of trust in China

Legal environment is under improvement Many regulatory restrictions

Housing cost

Facet 3

Complex interpersonal relationship

High personal income tax

Facet 4

–

Life quality

Facet 5

–

Rigid household registration system Ineffective social security system

Relatively lower income level in China Don’t get recognition at work Can’t apply my knowledge to China –

–

–

Facet 2

Heavy pollution in the city Children’s education

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3 Reverse Migration in China: Contemporary Chinese Returnees

strong political connections. The guanxi system has been a source of nepotism and corruption in Chinese society (Chen et al. 2004). According to Laurie Underwood, co-author of the book entitled China Entrepreneur: Voices of Experience from 40 Business Pioneers, the trick for most Chinese returnee entrepreneurs is “to maintain international business standards in the core practices–while adapting to local norms when possible.” Thus some returnee entrepreneurs experienced a “reverse cultural-shock” when coming back to China. Our research results show that in Fig. 3.4, 83.9% of respondents hesitate to return due to the central importance of guanxi and reciprocity exchanges within Chinese society, 78.1% because of the low level of trust in China, and 76.9% because of complex interpersonal relationships. Our findings support the statement of David Zweig that “returnees, or those who hesitate to return, often say that in China, ‘personal relationships are too complex’—a code for the backstabbing and petty jealousies and the need to cultivate ties with leaders in your own field.” Some scholars note that, in China, guanxi functions as a substitute for legal protections, providing “contextual confidence” for building trust (Child and Mollering 2003). Some 86.6% of our respondents chose the “under-improved legal environment” as the reason making them hesitant to return to China, 71.9% cited “the regulatory restrictions,” and 71.3% “the rigid household registration system.” Every Chinese citizen is assigned a hukou location (hukou suozaidi) and falls under “Regulations on Household Registration in the People’s Republic of China”. The hukou location specifies where one is entitled to receive benefits, including social security and free education for his/her children. Moreover, China does not recognize dual citizenship. Therefore, returnees who have given up their Chinese citizenship (and thus hukou) have to apply for limited duration visas to stay in

Hindering factors for returning to China 100 90 80 70 60 50 40 30 20 10 0

Fig. 3.4 Distribution of hindering factors for returning to China

3.2 Survey on Contemporary Chinese Returnees …

63

China. There are different types of visas for foreigners who are visiting or working in China, depending on the nature of their visit and stay. Returnees who are working in China must have a work or residence visa, and their residency and working rights in China are contingent on their visa status. Even though they are making a major contribution to the Chinese economy, such returnees not only have to go through a complicated bureaucratic procedures when applying for a work permit and visa, but ones with foreign citizenship have limited access to social security rights in China. China began granting permanent residency permits (Green Cards) to foreigners in 2004. Since then, more than 4700 foreigners have received permits. But unlike traditional immigrant nations such as the U.S. and Canada, the P.R. China’s card is mostly given to foreign aliens who already live in, or are well-established in the country. But in a bid to attract more international high-end professionals to the world’s fastest-growing economy, China has pledged to ensure better treatment of foreigners who hold Chinese Green Cards. The latest guidelines and policy amendments aimed at easing permanent residency requirements are now being drafted by 25 government agencies, including the Ministry of Human Resources and Social Security and the Ministry of Public Security. In an interview, Liu Guofu, an immigration law expert at the Beijing Institute of Technology, stated: “the draft mostly targets immigrants in the field of technology who will be able to apply for permanent residency after living in China for 10 consecutive years, provided they have spent at least nine months each of those years in the country. They must be employed, have accommodations and a good tax record. The success of their application will no longer depend on the position they hold.” Current regulations require applicants, in the technology sector to hold a position of deputy general manager or associate professor (or higher) for at least four successive years. If the draft is approved, more foreigners will be eligible to apply for a green card. To attract talent and to create a good environment, some provinces in China, such as Jiangsu, Zhejiang and Fujian, have launched “talent residence permit” to attract high professionals by making it more convenient for them to work and live in such places. The “talent residence permit” issued by Fujian Provincial Civil Service Bureau mainly targets high-end talent, including overseas talent and professionals outside the province. This measure contains the following categories: (1) people selected for the Provincial Central Plan and Fujian Hundred Talents; (2) those capable of filling the shortage of qualified personnel specified in the Fujian high-level directory of talent; (3) ones meeting the needs of provincial municipalities and districts for the high-level entrepreneurship; (4) entrepreneurs with independent intellectual property rights and patents. The “Talent residence permit” will encourage high-end talent to move to and remain in Fujian by making the search for housing, business registration, social security, and the education of their children more convenient for returnees.

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3 Reverse Migration in China: Contemporary Chinese Returnees

3.2.1.4

Policy Effects on Returnees with Different Overseas Experience

In our survey, we examined the incentive effectiveness of local Chinese government’s preferential policies on returnees. We find that over 80% of returnees have been encouraged by the following policies to want to return to go back to and live in local provinces: (1) granting lump sum award and financing guarantee; (2) providing subsidized apartments; (3) easing restrictions associated with the household registration system; (4) giving them priority for medical treatment; (5) providing support for spouses; (6) simplifying the residency requirements and visas (Fig. 3.5). This shows that providing financial subsidies, easing bureaucratic procedures and providing certain supports to their family are fundamentally important to retaining returnees. China has been stepping up its efforts to attract educated professionals to fill gaps in its labor force and to increase innovation in selected sectors of the economy. To encourage highly skilled overseas Chinese to return home and participate in nation-building, the government has instituted several programs. The “Hundred Talents Program” of the Chinese Academy of Sciences provided incentives to lure back top-level scientists and professionals in the form of grants to start a laboratory for their proposed research, including financial support for buying equipment and hiring technical personnel. To ease entry of Chinese expatriates back to China, the government simplified the residency requirements and entry visa for overseas scholars who wish to return or come back for short visits to engage in collaborative work. GranƟng lump sum award and financing guarantee

87.2

Providing subsidized apartments

82.6

Easing a restricƟon of the household registraƟon

82.6

Providing priority for medical treatment

80.9

Simplifing the residency requirements and entry visa

80.6

providing support for spouses

80.2

Remiƫng the tax of returnee companies on imported equipment Holding concurrent posiƟons in Chinese research insƟtuƟons or companies and overseas

78.5 77.8

Ease the restricƟon of use of S & T expenditure

76

High priority to research project dominated by returnees

75.7

FacilitaƟng collaboraƟon between Chinese universiƟes and high-skilled diaspora (or returnee company) Simplifing foreign exchange procedures for returnee companies

73.3 73.3 65

70

75

The ranking of the importance of local preferenƟal policies

Fig. 3.5 Ranking the importance of local preferential policies

80

85

90

3.2 Survey on Contemporary Chinese Returnees …

65

Local governments have also developed various talent schemes targeting different types of talent, especially senior managers and returnee entrepreneurs who have developed their own patents or technology. For instance, in 2011, the Ningbo Municipal Government, Zhejiang province, introduced the 3315 Program to attract high-ranking overseas talent. Individuals covered under this program receive a lump sum of RMB 1 million; members of an excellent work team, each get a sum of RMB 200,000, with the ceiling of RMB 1 million for the whole team; particularly accomplished work teams receive even more financial support. Team research projects can receive priority in the application for state or provincial support. All of those participating in such programs are eligible for free housing for themselves and their families, with their spouses receiving job placement help or a cash living allowance.

3.2.2

Survey on Chinese Returnee Entrepreneurs

From November 2012 to April 2013, we used both online and offline surveys to investigate returnee entrepreneurship. The online survey collected 199 valid questionnaires, of which 103 were collected from Zhaopin.com and 96 were collected from Center for China & Globalization (CCG) and the database of Western Returned Scholars Association (WRSA). The offline survey obtained 24 valid questionnaires through the 15th Guangzhou Convention of Overseas Chinese Scholars in Science and Technology, and 44 via the 2012 National Overseas Returnees’ Entrepreneurship Training Seminar. Thus, a total of 267 valid questionnaires have been collected about returnee entrepreneurs, among which 156 were from individuals who had already come back to China to start their business, or 58.4% of the total surveyed, and 111 who were planning to come back and start their business, or 41.6% of the total surveyed. The respondents included 196 males and 71 females, representing 73.4 and 26.6% of the total surveyed, respectively.

3.2.2.1

Location Distribution

Our survey shows that 70.6% returnees choose Beijing, Jiangsu, Guangzhou and Shanghai as the places to start their business. Beijing has the largest concentration of returnee companies, accounting for 36.1% of the total number of ventures created by these individuals. Beijing is followed by Jiangsu (14.8%), Guangzhou (11.5%) and Shanghai (8.2%). But the distribution of returnee entrepreneurial firms is becoming increasingly spread out across China, with some 4.9% of returnees choosing to set up business in Liaoning, Shandong, and Hubei provinces, 3.3% selecting Jiangxi and Sichuan, and 1.6% opting to locate in Zhejiang, Hunan, Chongqing, Hainan and Guangdong (Guangzhou excluded) (Fig. 3.6). Florida (2002) argues that cities wishing to attract creative class talent should above all have ‘3T’ power—Tolerance, Technology, and Talent. He argues that the

66

3 Reverse Migration in China: Contemporary Chinese Returnees 40 36.1 35 30 25 %

20 15 10 5

14.8 11.5 8.2 4.9 4.9 4.9

3.3 3.3

1.6 1.6 1.6 1.6 1.6

0

Fig. 3.6 Location distribution of returnee entrepreneurial businesses

tolerance of a metropolis is defined by its diversity of thought and open-mindedness (Florida 2005). In the context of China, Florida et al. (2008) proposed population diversity, which is gauged by the share of residents who are from other provinces and local residence permits (Hukou), as a substitute index to measure tolerance of a city. Technology power refers to the outcome of creativity, while talent power is a given city’s pool of highly skilled and educated people. Beijing, Shanghai and Guangdong have large numbers of immigrants from other provinces. This diversity may partly explain why they are attractive to returnee entrepreneurs, as these mega-metropolises provide a more tolerant atmosphere for returnees and returnee entrepreneurs. Jiangsu, Shanghai, and Zhejiang are all part of the Yangtze River Delta Economic Region, which accounts for one-fifth of China’s GDP and one-third of its foreign trade. It might be easier for returnee entrepreneurs to access the requisite resources and skilled and talented personnel for their businesses in these provinces. Many governments in the coastal regions have realized the important role that returnees play in regional high-tech development. This is true not only with respect to the provincial level governments, but local county-level authorities in the coastal regions as well. The latter have taken the lead in promoting returnee entrepreneurship. That also helps to explain why returnees and returnee entrepreneurs are concentrated on coastal areas. For instance, Changzhou, Jiangsu Provinces, has specifically targeted four categories of returnees. These are those who have developed technologies in high-tech industries, individuals with intellectual property rights and patents which have great market potential, entrepreneurs able to bring advanced technologies and equipment to Changzhou, and returnees capable of managing big projects and who can help the city develop high-tech industries. Returnee entrepreneurs can apply for various innovation funds and have good education and welfare benefits for their children and other family members.

3.2 Survey on Contemporary Chinese Returnees …

3.2.2.2

67

Industry Distribution of Returnee Entrepreneurial Firms

Most of the returnee entrepreneurs starting their own business focus on high-tech and other knowledge intensive industries, especially in the new generation of IT, biotech, and pharmaceutical products and services. These sectors alone account for 51.6% of returnee entrepreneur new business ventures. Companies involved in devising novel forms of energy and materials account for 9.6 and 6.3%, respectively, of the new firms established by returnee entrepreneurs. Our findings also show that the cultural and creative industries are becoming an increasingly important field for returnees to start their business, with 13.3% of the returnees sampled undertaking new ventures in these areas (Fig. 3.7).

3.2.2.3

Funding Sources of Returnee Entrepreneurial Firms

The capital channels for returnee startup companies include government investment, including projects approved by regional high-tech development zones, personal and family savings that can be invested into the business venture, and private capital in forms of domestic or foreign joint venture and venture capital. In our survey, the most important source, or 46.1%, of the initial funding for the new companies started by returnees came from their personal capital, much of which consists of their accumulated savings. Private capital, in the form of domestic/foreign joint venture and venture capital, accounts for 20.6% of the funds available to support returnee entrepreneur new businesses. Loans from friends and family members, government investment and financial market capital financial market represent 14.6, 9.7 and 4.9% respectively (Fig. 3.8). Although many returnees bring back advanced technology and business models from abroad, few of them start their business by becoming a shareholder through their possession of intellectual property rights, which may well be due to China’s 35 32.9 30 25 %

20 15 10 5

18.7 13.3 9.6 6.3

6

4.8

2.4

1.4

1.2

1.2

0

Fig. 3.7 Industry distribution of returnee entrepreneurial businesses

2.2

68

3 Reverse Migration in China: Contemporary Chinese Returnees 35

32.9

30 25 (

18.7

)

% 20

13.3

15

9.6

10

6.3

6

4.8

5 0

Fig. 3.8 Distribution of initial funding sources

weak legal protections for intellectual property. Therefore, with respect to the personal capital possessed by returnees, their intellectual property rights only accounts for 0.61% of that particular resource/asset category. By contrast, 45.45% of the personal capital used by returnee entrepreneurs in setting up new businesses came from their personal savings (Table 3.3). The importance of private capital in supporting returnee entrepreneurship is gradually increasing and has become an major source of financial backing for these individuals as they try to establish new companies. According to the survey, just over one-fifth (20.6%) of the returnees’ Table 3.3 Distribution of main initial funding sources Sources Personal Private capital

Family and friends Government Financial market Others Total Unit %

Percentage of each part

Overall percentage

Savings Intellectual property Domestic joint venture Foreign joint venture Domestic venture capital Foreign venture capital Loans from friends and family members Investment Subsidy Bank loan

45.45 0.61 7.88 2.42 7.88 2.42 14.55

46.06

8.48 1.21 4.85

9.69

– –

– –

4.24 100

20.60

14.55

4.85

3.2 Survey on Contemporary Chinese Returnees …

69

entrepreneurial capital comes from private capital. As a new instrument for financing new companies, the main function of venture capital is to provide the resources and environment which make it possible for fresh entrepreneurial ventures to experience smooth and rapid growth. The survey shows that only 2.4% of respondents receive funding from foreign venture capital firms, while 7.9% comes from domestic venture capital firms.

3.2.2.4

The Composition of Returnee Entrepreneurial Team

The survey also reveals that returnees comprise a large share of the core management teams in the companies set up by such individuals. In over 70% of the firms established by returnees, returnees comprise more than half of the core management team. There are 37.2% of returnee companies where returnees account for over 80% of the core management team, while in 35.5% of these companies, 50–80% of the core managers are returnees (Fig. 3.9). The strengths of returnees and local employees can be seen as complementary. On the one hand, the knowledge and experience that returnees have accumulated overseas and their understandings of both Chinese and Western culture make it easier to implement advanced operational management methods from abroad, which can help the business function more effectively. On the other hand, because they have been away from China for long periods of time, returnees lack domestic social resources. In contrast, local employees have a much better understanding of domestic working methods and operating procedures, enabling them to help returnees better understand the local environment, especially governmental policies affecting business operation. Thus staffing the management team with a mix of returnees and local talent offers the best guarantee of success for returnee entrepreneurship.

89.4 100 90 80 70 60 % 50 40 30 20 10.6 10 0

75.3

24.7

73

27

71.3 28.7

Non-returnees

Fig. 3.9 Composition of core management teams

78.2

79.5

21.8

Returnee

20.5

81.7

18.3

70

3 Reverse Migration in China: Contemporary Chinese Returnees

3.2.2.5

Acquisition of Technological Resources

Most of the entrepreneurial returnees are technological experts who have their own intellectual property rights and have participated in the invention of important products. Returnee entrepreneurs play a key role in making their companies innovative. Our study results indicate that returnee entrepreneurs are able to obtain assets via both domestic and international networks to explore opportunities and develop businesses in China. While most of returnee entrepreneurs obtain technological resources from overseas, they are more likely to acquire consumer, financial and governmental network resources from within China. In our earlier survey conducted in 2012, we found that returnee entrepreneurs mainly obtain consumer (67.8%), financial (57%) and government network resources (73.6%) from domestic Chinese sources, while a relatively low percentage (20.7) rely on home-grown technological resources (Fig. 3.10).

3.2.2.6

Research and Development (R&D) Investment

In our survey conducted in 2012, more than 30% of returnee entrepreneurial firms spent at least 50% of total revenues in R&D. Around 21.1% put 75% or more of their total revenues into R&D in 2010, while 9.5% put 50–75% of sales revenue into R&D (Fig. 3.11). Constantly focusing on R&D is extremely important for hi-tech firms, enabling them to maintain a leading edge with respect to research and innovation. Our findings show that returnee entrepreneurial enterprises are keen on innovation and leveraging that innovation into developing not just new products, but new products with greatly enhanced performance. Over the past two decades, China has witnessed the emergence of the formidable economic and technological force of returnee entrepreneurs and their

Foreign technological resources

87.6

Foreign talent resources

54.6

Foreign consumer resources

33.1

Foreign financial resources

20.7

Foreign government resources

8.3

DomesƟc government resources

73.6

DomesƟc financial resources

67.8

DomesƟc consumer resources

57.9

DomesƟc talent resources

57

DomesƟc technological resources

20.7 0

20

40

60

Fig. 3.10 Resources entrepreneurial returnees obtained from abroad

80

100 (%)

3.2 Survey on Contemporary Chinese Returnees …

71

9.50% R&D cost accounts for less than 25% of the total revenue 36.80%

21.10%

R&D cost accounts for 20%50% of the total revenue R&D cost accounts for 75%100% of the total revenue R&D cost accounts for 50%75% of the total revenue

32.60%

Fig. 3.11 Ratios of R&D cost to revenue in 2010 for returnee entrepreneurial firms

entrepreneurial activities. The strong entrepreneurship of contemporary Chinese returnees is the most remarkable difference between these individuals and their predecessors. They have created high-tech startup companies and brought back to their mother country new management concepts and innovative financial methods. These activities, in turn, have had a profound influence on the entrepreneurship in China as a whole. Most of the companies created by returnee entrepreneurs are in high-tech sectors or are high-end service providers. High tech experts at the cutting edge of science— as noted above, many of these individuals even own patents—comprise the top management of these companies. Thanks to their close relationship with international companies, advanced management experience, and wide contact, these highly skilled and talented individuals function as a bridge between China’s domestic companies and international market. Returnee entrepreneurs have significantly pushed forward the development of China’s domestic high-tech business and service, and improved the competitiveness of its enterprises in international markets. The large numbers of returnees starting businesses have brought back with them to China the mechanism of venture capital investment. Almost all of the founders of venture investment companies are returnees. Most of China’s high-tech companies listed in Europe and the U.S. were founded and then brought to overseas stock markets by returnees. Scores of Chinese companies with a total market value of USD $60 billion are now listed on Wall Street. Such firms include famous names like Asiainfo, Baidu, Sina, Sohu, ViMicro, Ctrip, eLong, Shanda, 51job, Kongzhong.com, SunTech Power, New Oriental School, Home Inns, and the like. These overseas listed companies have brought advanced technology and talent to China, along with international capital and new mechanisms for managing enterprises and raising capital for them. All these factors will have a significant positive impact on the Chinese people, especially on the younger generation.

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3 Reverse Migration in China: Contemporary Chinese Returnees

3.2.3

General Situation of Returnees’ Employment

Two decades ago, Chinese overseas returnees were treated like national treasures after returning home; however, recently their aura has lost much of its earlier luster. In the past, overseas returnees were treated as rare species because they brought back advanced knowledge and technology. But due to the rapid development of domestic communications systems, people can easily find the information they need online. Therefore, being a returnee is not such a big deal anymore. —Sha Yezhou, a major of finance and banking at the Queen Mary, University of London I was nothing before going abroad. But someone told me that I would be something after receiving an education in a foreign country. However, even though I am now an overseas returnee, I still feel like nothing. —Zhan Ning, an overseas returnee who came back to China from Britain in 2011

Since the end of the 20th century, China has seen the growing numbers of its citizens who have lived abroad and then returned home act as an important force in raising the scientific and technological level of its economy. In recent decade, however, overseas returnees began to lose their competitive edge against local talent. Many returnees have started facing difficulties in searching for jobs and they were forced to accept salaries well below their expectations. The Survey Report on Employment Pressure of Overseas Returnees in 2012 undertaken by the Education International Corporation (EIC), which had more than 8000 respondents, shows that nearly 67.2% of returnees earn an annual salary of less than RMB 60,000 at their first job and the average annual salary level of the majority is RMB 83,000, making their incomes no higher than individuals with degree from a Chinese university. In addition, more than half of the respondents, or 58%, are working as lower-level employees; only 6%, by contrast, have found senior managerial positions. According to the EIC survey, many low to middle class families with total annual incomes of less than RMB 30,000 are sending their children abroad. However, at such a small return, a growing number of these families have begun to question whether it is worthwhile to invest in an overseas education for their sons and daughters. The survey also shows that huge income differences exist among overseas returnees. On average, the income gap between executives and ordinary employees is 5.4 to 1 among returnees, compared with 3.1 to 1 for those who had less than three years or no overseas work experience. A gender pay gap also exists among returnees. Deng Feng, founding managing director and partner of Northern Light Venture Capital, says: “being a returnee only means that you have been abroad for a period of time. Three months and 30 years of staying abroad are definitely not the same.” Despite the fact that many returnees are having a hard time finding jobs, the competition among China’s government departments, state-owned and private enterprises, and non-government organizations for highly skilled international

3.2 Survey on Contemporary Chinese Returnees …

73

professionals is becoming more intense. The growing number of multinational corporations now operating in China, along with the increasing desire of domestic Chinese firms to go global, has led to a huge demand for professionals with international experience.

3.2.3.1

Employment Location of Returnees

Previous research shows that while big cities like Beijing and Shanghai are still the first choice of returnees, more and more of those who have recently finished studying at foreign universities are considering career opportunities in so-called second-or-third-tier cities like Chengdu, Xi’an and Wuhan, along with prosperous and rapidly developing coastal cities such as Shenzhen, Wenzhou, Zhuhai, Dalian, Qingdao, Yantai, Ningbo (Wang 2004). The results of our survey somewhat dovetails with these previous studies. While it shows that returnees have a preference for coastal provinces, large numbers are also choosing to settle down in Beijing. In fact, the Beijing self-governing municipality and Guangdong province have attracted far larger numbers of returnees than other provinces, including the ones on the coast of China. As the political and higher educational center of China, Beijing has always been attractive to returnees. And as one of the most economically developed Chinese provinces and the first one on the mainland to be strongly influence by the capitalist market economy, Guangdong has been a top choice for returnees in search of good jobs (National Bureau of Statistics of the Peoples Republic of China, Statistical Yearbook [various years]). However, this strong preference for Guangdong among returnees may be affected by our data collection process and sample–we did the offline survey during the 2011 Convention of Overseas Chinese Scholars in Science and Technology in Guangzhou, the capital city of Guangdong.

Liaoning

1.4

Jilin

1.5

Shaanxi

1.8

Tianjing

1.8

Heilongjiang

2

Hubei

3.5

Henan

4.2

Shandong

5.2

Zhejiang

5.3

Jiangsu

6.4

Guangdong

8.7

Shanghai

14.2

Beijing

41.6 0

5

10

15

20

Fig. 3.12 Location choices of salaried returnees

25

30

35

40

45

74

3 Reverse Migration in China: Contemporary Chinese Returnees

We also found that survey respondents prefer Jiangsu province over Shanghai, which may be due to the efforts of the Jiangsu provincial and city governments to proactively attract overseas talent back to Jiangsu (Fig. 3.12). In 2006, Jiangsu Province initiated a scheme targeting innovative returnee entrepreneurs, with the aim of adding 20,000 workers from overseas to the local labor force in the next five years. In addition to providing more than RMB 1 million in financial support to each of the talented and skilled individuals targeted in the program, the province set up liaison offices in eight developed countries, including the U.S., Australia, and Japan, to attract top Chinese overseas talent. Glaeser and Mare (2001) has predicted that the future of the cities depends on their ability to provide attractive living environments for affluent and highly skilled people, who now are less tied down to a specific place while being employed. Jiangsu province has announced a series of preferential policies to improve living and working conditions of high level talent to ensure that returnees receive proper accommodation and their family members obtain assistance in finding work and receiving an education.

3.2.3.2

Returnees’ Choice of Careers

According to a study done by Zhang (1999), an overwhelmingly high percentage of returnees (73.5%) chose to work at colleges and universities or scientific research facilities. Specifically, 8.2% chose to work for multinationals or foreign invested companies, with only 0.9% choosing to be employed in private firms founded by local entrepreneurs. Additionally, 3.4% decided to start their own business. However, a survey conducted by the Chinese Overseas-Educated Scholars Association in 2005 shows that the preferences of returnees with respect to place of work have changed signficantly. This later study showed that over 50% of returnees chose to work for multinational enterprises or foreign invested companies, while 27.6% opted to start their own businesses. A survey on Chinese returnees conducted by Wang (2007) also indicates that returnees’ choices regarding the kinds of businesses and organizations they choose to work for have become increasingly diverse. Some 30.53% of survey MulƟnaƟonal enterprises or foreign invested companies

18.30% 30.53% 3.80%

UniversiƟes and research insƟtutes DomesƟc private firms State-owned enterprises

10.70%

Government bodies

17.60%

19.10%

Other places

Fig. 3.13 Distribution of returnees by type of business and institution

3.2 Survey on Contemporary Chinese Returnees …

75

respondents opted to work for multinational enterprises or foreign invested companies, 19.1% at universities and research institutes, 17.6% in domestic private firms, 10.7% in state-owned enterprises, 3.8% for the government bodies, and 18.3 in other places (Fig. 3.13). Our survey shows that noteworthy changes have occurred with respect to employment choices of returnees. Dividing up returnees according to the various kinds of businesses and organizations where they work shows that about 26% are in multinationals or foreign invested companies, 23% in private enterprises founded by local entrepreneurs, 15% in state-run institutions, 10% in state-owned enterprises, 5% in private enterprises founded by returnee entrepreneurs, and 3% in government bodies. Changes in the patterns of employment of returnees seem to coincide with changing trends in wage differentials between government agencies, state-run institutions, foreign invested companies, and domestic companies. Employees in government, state-run institutions, and state-owned enterprises traditionally have been viewed as occupying a privileged position in China, while working in the private sectors had been viewed as too risky and unstable; as such jobs are more likely to be eliminated during economic downturns. This may explain why the majority of returnees chose to stay in colleges and universities or scientific research facilities before 1999. However, the labor market has been significantly altered by the continuing corporatization of large state-owned enterprises (SOEs). Public-private sector earnings differentials in China have changed significantly since the reform of the state sector began at the turn of the 21st century. Government statistics indicate that, on average, the wages paid by foreign-owned firms were about 40% higher than by SOEs and state run institutions in the early 2000s, which explains the high percentage of returnees working at foreign-owned firms and joint venture companies. But this gap has narrowed considerably in recent years. By 2011, the earnings differential between foreign-owned firms and SOEs had shrunk by 11% and there were more opportunities for high wage premiums for state employees than for non-state employees (Ge and Yang 2010). Nevertheless, private and individual enterprises are still very attractive to talented younger returnees, as they provide more flexible career development opportunities.

3.2.3.3

Industry Distribution of Employers

Survey results show that a high percentage of respondents are employed in the high technology and knowledge-intensive sectors. Much of the literature argues that returnees have played a critical role in knowledge diffusion in the high-tech industries in their home countries (Obukhova 2012). As can be seen in Fig. 3.14, as many as 48.5% of returnees surveyed work in the finance industry; 9.1% in education and research; 8.7% new generation IT technology and 7.4% in both biological engineering and creative culture, respectively (Fig. 3.14). We find a somewhat high percentage of respondents (6.9%) in government bodies and public utilities. Throughout the modern history of China, returnees have held important governmental posts. Returnees can now not only be found in the

76

3 Reverse Migration in China: Contemporary Chinese Returnees 60 50

48.5

40 30 20 10

9.1

8.7

7.4

7.4

6.9

3.9

3.5

3.5

1.3

0

Fig. 3.14 Distribution of returnees’ employers by industry

central government and serving as representatives in the national People’s Congress, but also serving as public officials in rural areas. More and more governments in rural areas are making good use of the experience of overseas returnees to boost grassroots development in the countryside. A survey conducted by the Education International Corporation (EIC) in 2011 shows that only 6% of returnees are first-line managers and 58% are grassroots workers. This is consistent with our survey results. Only 6.3% of returnees hold upper-level positions, 27.4% occupy middle level posts, while 57.8% serve as lower-level staff members in a business or other organization (Fig. 3.15). Our survey shows that even though ordinary returnees are facing difficulties in finding work, the overseas experience of highly skilled returnees still commands a premium on the Chinese labor market. As our above survey results show, returnees are a special group whose attitudes and values have been strongly influenced by foreign cultures. Most of the returnees grew up during the reform and opening era in China. Before leaving China, they had developed their worldview and mindset under a distinctive and evolving Fig. 3.15 Distribution of salaried returnees’ occupational positions

6.30%

27.40%

57.80%

Upper-level posiƟons Middle-level posiƟons Lower-level posiƟons

3.2 Survey on Contemporary Chinese Returnees …

77

socialism with Chinese special characteristics. Their international experience, largely in developed Western societies, has exposed them to significant differences in values and thinking styles, even as many remained strongly influenced by traditional Chinese culture. In addition, their multicultural experience has enabled them to compare and contrast cultures and organizational logics, thereby giving these individuals a more global mindset (Levy et al. 2007). China has opened up to the outside world and is integrating itself into the global economy. And many social norms of Chinese society also have been recently affected by Western theories and rules. But the country still retains its distinctive and ancient cultural values, which remain deeply rooted in its social DNA. Therefore, effective communication with respect to relearning Chinese culture is an essential step in the re-integration of many returnees back into Chinese society. Above all, returnees need to realize that while knowledge gained in the West is valuable, it alone is no longer a ticket to success in China. That knowledge must be combined with a strong awareness of and adapted to local norms and practices. In conclusion, the Chinese Government has improved the country’s macroeconomic environment and created a start-up friendly business environment. It has done this to increase the brain circulation of returnees and returnee entrepreneurs to accelerate the globalization of this still emerging economy and ensure that it fully benefits from this process. But the overall business climate for entrepreneurs in China continues to be challenging for many high-skilled returnees. As our survey results show, a high percentage of the respondents feel that the market conditions are chaotic and irregular and people to people relations are too complicated. Some other difficulties and obstacles facing returnees include getting more mobile, securing employment, obtaining a good education for their children, financing a start-up firm, and coping with a dual cultural identity (and, in some cases, dual nationality).

3.3

Returning Chinese Promoting the Development of China’s New Economy

Historically, the vast majority of Chinese returnees were academics and scientists. However, this pattern changed in the 1990s, when growing numbers of returnees had been in business overseas before returning to China. Over this time, Chinese intellectuals have been reoriented toward the business world. As the success of high-tech zones like Zhongguancun have shown, returnee scientists are now avidly pursuing entrepreneurial opportunities in response to China’s transformation toward a market based economy. Encouraged by the government efforts to make the hi-tech zones function as incubators for returnee entrepreneurs, Chinese who have studied and worked overseas and acquired a strong scientific/technical background while doing so are establishing start-up business ventures after coming back home. These hi-tech zones assist returnees, who are often unfamiliar with working in China, in obtaining investment capital and physical space for their new business ventures, while also assisting them in dealing with bureaucratic red tape. Currently, statistics

78

3 Reverse Migration in China: Contemporary Chinese Returnees

show that governments from the national to local levels and universities have jointly established more than 300 science venture parks containing over 24,000 enterprises (People’s Daily 2017).

3.3.1

Entrepreneurial Start-Up Environment in China

For returnees trying to start a business in China, the overall business environment is bound to be an issue. Since the business environment is one focus of this study, we surveyed the returnees on this issue. Even though many returnees are coming to back to establish companies, the startup environment for entrepreneurs in China remains a challenge for them.

3.3.1.1

Business Environment

Figure 3.16 shows how returnees assess the local business environment and indicates that 65.2% of them believe that the current administrative examination and approval procedures are convenient, simple and direct. Some 62.8% think the local policies are open and transparent, while 59.6% find that the regulatory system is open and transparent in the places where they do business. These responses indicate that China’s local talent recruitment has secured the approval of returnees and reforming the talent working system has done some good. But the difficulties in obtaining credit and skilled labor remain the two major hurdles confronting startup returnee entrepreneurs in the current business environment. 66.7 and 52.3% of

Fig. 3.16 Evaluation on business environment of the places where entrepreneurial returnees founded their firms

3.3 Returning Chinese Promoting the Development of China’s New Economy

79

returnee entrepreneurs disagree with the statements that one “need not to pay extra fees except interest when loan from bank” and that is “easy to get loan from bank,” respectively. Another 63.2 and 62.4% disagree with the statements that it is “easy to find technicians from the local city” and “easy to find middle-level manager from the local city,” respectively. In addition, 43.8% think that the business infrastructure in the localities where they operate should be improved. 3.3.1.2

Entrepreneurial Park

The 2012 survey shows that entrepreneurial parks generally appeal to returnees, with 60% of returnee entrepreneurs choosing to set up shop in such locations. Entrepreneurial Parks for Chinese Scholars, Special Talent Zones, and High-level Overseas Talent Introduction Bases have served as important platforms for entrepreneurial returnees. According to statistics, prior to April 2013, China had set up 112 High-level Overseas Talent Introduction Bases and more than 260 Overseas Entrepreneur Parks for Chinese Scholars, with over 20,000 enterprises and more than 40,000 talented returnees making use of these facilities. In order to investigate the policy demands of returnees in Overseas Entrepreneur Park for Chinese Scholars or Talents Special Zone, we measure how important returnees view these policies on a ladder scale, with −10 being at the bottom of the scale and 10 standing at the top. A −10 score indicates that returnees view these policies as being “least important” in influencing their decision to start a new company. A “0” score stands for “neutral,” while a “10” denotes that such policies were “very important” for returnee entrepreneurs. According to this analysis, imperious policies for entrepreneurial returnees include housing subsidies, funding for innovation, help with their children’s education, capitalization support, streamlined business application and negotiation procedures and the like. Diagram 12 presents a detailed picture regarding the distribution of these factors and their importance for returnee entrepreneurs (Fig. 3.17). House rent reducƟon

8.08

Funding for innovaƟon

7.69

Income tax cut

7.38

AƩending talent meeƟngs, products exhibiƟons

6.92

Training courses and lectures

6.73

Help with the children's educaƟon

6.58

CapitalizaƟon support

6.35

Housing loan subsidies

4.3 0

2

4

6

8

10

(score)

Fig. 3.17 How much the entrepreneurial returnees demand policies of overseas entrepreneur park for Chinese scholars or talents special zone on a ladder scale

80

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3 Reverse Migration in China: Contemporary Chinese Returnees

Talent Programs

China’s talent programs have made some obvious positive achievements. According to latest statistics, up through the end of 2012, the Thousand Talents Program has attracted 3319 overseas high-level talented individuals back to China over a period of five years. In 2013, the number of declarations reached 4208, 70% higher than in 2012. So how much awareness do Chinese returnees have about these incentive schemes? We investigated this question in our 2012 survey. We found that more than 70% returnees “don’t know much” about these talent plans in general, while 84.3% said the same regarding the Thousand Talents Program. Indeed, just 14.5% stated that they are “familiar with” this program (Fig. 3.18). Two reasons can be offered as to why returnees are unfamiliar with these talent plans. First, the eligibility threshold for inclusion in these schemes remains very high, as they target only top-level overseas Chinese talent. According to the Thousand Talents Program eligible criteria, returnees who apply this plan should have obtained a doctoral degree from abroad and must be less than 55 years old. In addition to working in China for at six months out of the year, the plan also stipulates that applicants should meet one of the following conditions: Act as professor-level experts or scholars in a highly regarded foreign university or research organization, hold a senior level managerial or technical position in a major international company, or be an entrepreneurial talent owning independent property rights or possessing mastery over some core technique and familiarity with a related field and international rules while being self-employed overseas. Only

Fig. 3.18 Entrepreneurial returnees’ knowledge on different policies

3.3 Returning Chinese Promoting the Development of China’s New Economy

81

individuals meeting one of the above criteria and who can be identified as being high-level talent China urgently needs for its development are eligible to be considered for the Thousand Talent Program. A second reason for the lack awareness of returnees regarding incentive programs for luring overseas Chinese talent back to the Mainland is that they lack access to channels conveying information regarding such initiatives. As Jason Chan, Chairman of Wall Street Talents Association, said, “At the aspect of talent recruitment, the mechanism of Chinese talent introduction is lacking in pertinence. Many professional managers in Wall Street don’t watch Chinese domestic news and related media reports at all, so they don’t know the talent plans and related incentive measures of China at all.”

3.3.2

Major Forces Impacting the Development of China’s New Economy

The past three decades have seen an increasing number of Chinese returnees becoming involved in business start-ups or becoming entrepreneurs. With their education at top universities from around the world, deep involvement in the new economy, rich experience in venture capital and listing Chinese companies overseas, and work experience at top global Multinational Corporation (MNCs), these returnees are making an enormous contribution to China’s current growing economic engagement with the world. Even among Small and Medium Enterprises (SMEs), returnees remain actively involved in the global economy, exporting, networking, travelling, and owning overseas enterprises. Some of them have become leaders in high-tech industries and their contributions have positively influenced China’s globalization process.

3.3.2.1

Helping Chinese Enterprises in “Going Global”

In recent years, as China implements the “going global” strategy, some large state-owned competitive enterprises are beginning to appear in international capital markets. Getting listed overseas gradually became the first choice for Chinese companies going global, especially large state-owned enterprises. In 2003, China Life Insurance Company, People’s Insurance Company of China, and Beijing Capital Land were listed. In 2004, the Semiconductor Manufacturing International Corporation and Mengniu Dairy Group were listed overseas. In 2005, the Shenhua Group, Bank of Communications, and Construction Bank of China were listed in Hong Kong. And in 2006, the Industrial and Commercial Bank of China adopted A +H to simultaneously issue shares and created the largest first public issuing in the history of international capital markets. Meanwhile, some large private Chinese companies have tried to develop Mergers and Acquisitions (M&A) activities overseas to expand their markets.

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3 Reverse Migration in China: Contemporary Chinese Returnees

During the overseas listing and M&A process, people quickly developed a keen appreciation for the important function played by returnees, who have a foot in the door of Chinese and Western culture and thinking, as well as possessing an acute international vision. Thanks to returnee professional senior managers serving in well-known international investment banks, law firms and certified public accounting firms, overseas listing and M&As involving up to several dozen billion U.S. dollars could proceed smoothly and successfully for large enterprises such as ICBC and CPCC.

3.3.2.2

Managing MNCs in China

With 480 of the top 500 Multinational Corporations (MNCs) in the world now operating in China, there has been an increasing demand for talented people who have the management skills and transnational networks to act as a bridge between the East and the West. In fact, various reports by firms such as McKinsey have regularly pointed out that China is facing a serious shortage of middle- and high-level managers. As a result, Chinese overseas graduates, including both those who had already returned and ones working for MNCs or leading companies abroad, have filled many of the top management positions in MNCs operating in China, often as in-country directors. The list of MNCs that employ returnees as CEOs, executive VPs, and other senior posts is impressive, including Google, Microsoft China, UBS, Alcatel, News Corp, Siemens, Hewlett Packard, Ernst and Young, BP, General Motors and many others. Having participated in the strategic China planning in these companies, those returnees are able to put their own strategies and ideas into place. They facilitate the localization of MNCs, improve China’s overall industrial structure, and help Chinese enterprises move up the value chain in world trade. While China’s socialist heritage and troubled historical relationship with the West may cause people to see MNCs as a threat to Chinese sovereignty, Zhang Yaqin, Microsoft VP responsible for R&D in China, believes that most returnees in senior positions in MNCs feel equally responsible for the growth of their company and supporting China’s economic development. This dual notion is reflected in Microsoft Research Asia motto: “Work at Microsoft, serve China”. Furthermore, as recently noted by Wang Chunyan, VP of Siemens China, returnees working in MNCs have improved communication between China and the world, thereby enhancing the image of the country across the globe. Over the past three decades, MNCs have done their share in promoting China‘s economic development. Statistics from the Chinese Ministry of Commerce show that at the end of September 2006, 570,000 foreign-invested enterprises (FIE) had contributed a total of USD $665 billion to the country’s economy. Over 800 research and development centers have been set up by MNC in China, and these have significantly boosted its high tech competitiveness. Most of these centers, it should also be noted, are headed by returnees. MNCs are also a key channel through which Chinese products are sold abroad. Since so-called “foreign invested

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83

enterprises” (FIEs) are responsible for over 55% of China’s exports, returnee executives have helped MNCs sell “made in China” products to the outside world.

3.3.2.3

Creating a New Business Culture in China

Returnee entrepreneurs and other talented returnees have played a leading role in creating a new business culture and pushing forward the formation of China’s contemporary entrepreneurship as the country makes the transition from a planned to market economy. An entrepreneurial culture has long been recognized as one of the most important characteristics of a successful high-technology firm. One of the most outstanding contributions of Chinese returnees to the reform and opening-up of China is their entrepreneurial spirit, which goes hand-in-hand with their impact in bringing back talent, capital, technology, and advance management know-how to boost the economic and social development of China. In brief, as the world prepares to deal with a globalizing China, it must be prepared to deal with a distinct cohort of returnee entrepreneurs and business elites, who have been trained overseas and are embedded in at least two different social and economic arenas. Their contribution to and impact on China and the outside world will be felt now and for many years to come.

3.4

Concluding Remarks

China has undergone enormous economic changes in the past 30 years and now faces important decisions on how best to sustain this unprecedented level of growth. While China’s past success was built mainly on its population dividend and heavy investment in manufacturing and infrastructure, its future growth will rely more on devising a strategy for making the best use of its talent, both at home and overseas. This will involve luring Chinese talent studying and working abroad back to the Middle Kingdom. Cheap labor has fueled China’s development over the past three decades, but due to the heavy reliance of that growth on old manufacturing industries, heavy use of resources, especially energy, and environmental damage, it is no longer sustainable. China now stands at a cross-roads in which it must shift to a new growth model involving knowledge-based activities and doing this will necessitate attracting a larger share of global talent to work in the country.

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Chen CC, Chen YR, Xin K (2004) Guanxi practices and trust in management: a procedural justice perspective. Organ Sci 15(2):200–209 Child J, Mollering G (2003) Contextual confidence and active trust development in the Chinese business environment. Organ Sci 14(1):69–80 Florida R (2002) The rise of the creative class. Basic Books, New York Florida R (2005) Cities and the creative class. Psychology Press, p 130 Florida R, Mellander C, Stolarick K (2008) Inside the black box of regional development. J Econ Geogr 8:615–649 Ge SQ, Yang T (2010) Labor market developments in China: a neoclassical view. IZA Discussion Paper, No 5377 Glaeser EL, Mare DC (2001) Cities and skills. J Labor Econ 19(2):316–342 Levy O, Beechler S, Taylor S, Boyacigiller NA (2007) What we talk about when we talk about “global mindset”: managerial cognition in multinational corporations. J Int Bus Stud 38(2):231–258 Obukhova E (2012) Motivation vs. relevance: using strong ties to find a job in urban China. Soc Sci Res 41(3):570–580 Pearce JA II, Robinson RB Jr (2000) Cultivating Guanxi as a foreign investor strategy. Bus Horiz 43(1):31–39 People’s Daily (2007) What Returnees Bring to China? Available at: http://finance.people.com.cn/ GB/71364/6096820.html People’s Daily (Overseas Edition) (2017) China’s largest wave of returnees, 28 Feb. Available at: http://paper.people.com.cn/rmrbhwb/html/2017-02/28/content_1753580.htm Saxenian A (2002a) Local and global networks of immigrant professionals in Silicon Valley. Public Policy Institute of California, San Francisco, CA Saxenian A (2002b) Transnational communities and the evolution of production networks: the cases of Taiwan, China and India. Ind Innov (Special Issue on Global Production Networks) 7(3):183–202 Saxenian A (2006) The new argonauts: regional advantage in a global economy. Harvard University Press, Cambridge Schler RS, Jackson SE (1987) Linking competitive strategies with human resource management practices. Acad Manag Executive 1(3):207–219 Tsui AS, Farh JL (1997) Where Guanxi matters: relational demography and Guanxi in the Chinese context. Work Occup 24(1):56–79 Tung RL, Lazarova M (2006) Brain drain versus brain gain: an exploratory study of ex-host country nationals in central and east Europe. Int J Hum Resour Manag 17:1853–1872 Wang HY (2004) Returning times-an overall review and analysis on Chinese returnees. China Central Compilation & Translation Press, Beijing Wang HY (2007) Contemporary Chinese returnees. China Development Press, Beijing Zhang X (1999) Return and situation of returnees since reform and opening-up: analysis on questionnaire of returnees. Res Overseas Chin Hist 2:55

Chapter 4

Global Talent Migration: The Barrier and Breakthrough of Foreign Immigrants in China

4.1

Introduction: Global Talent Migration

Global talent migration is one of the frequently discussed topics internationally. It has significant influence for both home and host countries on issues such as economic development and more. As the world is currently in the era of an explosive quest for knowledge, skills and experiences like no other, the demand for talents, skilled workers and professionals internationally is increasing dramatically. Governments internationally have been competing for talents internationally with generous immigration systems and talent attraction mechanisms. Countries that are experienced with international migration, especially economic developed countries such as the U.S., Canada, the U.K., France and so on, are currently taking the lead in the international competition for talents. As the economy in China is developing across many different fields, the Chinese government is joining the global competition for talents. After efforts by the Chinese government in the last decade, large numbers of international talents, mainly Chinese professionals from overseas, have been attracted to the country. The significant contribution made by Chinese professionals returning to the country from overseas in the social and economic development in the country should be recognized. Meanwhile, there are increasing numbers of foreign talents coming to the country as well, the contribution they can make to the economic development has started to be revealed. However, as a newly developing economy, the competitiveness of China to international talents is comparatively weaker than experienced economically developed countries. Although the Chinese governments are focusing on establishing and refining the talent attraction mechanism, studies by the Center for China and Globalization (CCG) previously showed evidence of barriers and restrictions which still persist. Such restrictions can be found in requirements for applications for visa and permanent residency, and more. Meanwhile, the imbalance in numbers

© Springer Nature Singapore Pte Ltd. 2017 L. Miao and H. Wang, International Migration of China, DOI 10.1007/978-981-10-6074-8_4

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4 Global Talent Migration: The Barrier and Breakthrough of Foreign …

between Chinese international migrants leaving the country and international migrants entering and staying the country is showing a deficit in terms of talent inflows to the county.

4.2

The Migration Status of Foreign Talents in China

Other than Chinese returnees, including professionals which are attracted to return to China, the rapid economic development in China has also started to attract foreign immigrants coming to China for study and work. In 2013 the Department of Economic and Social Affairs of the UN estimated that there were 848,500 foreigners living in China. The UN report also highlighted that for the 10-year period up to 2013, there was an annual average growth rate of foreigners in China of 3.9% (UN Department of Economic and Social Affairs 2013). Foreign talent immigrants refers to the foreigners who cross the border into China, mainly including foreign investor immigrants, foreign skilled immigrants, and foreign students in China.

4.2.1

Foreign Investment Immigrants in China

From 2004 to 2010, Chinese government successively promulgated the Management Measures for Foreigners’ Permanent Residence Approval in China and the National Medium and Long-term Talent Development Plan Outline (2010– 2020) to improve foreigners’ permanent residence system, the foreign investment in China increased from USD $60.63 billion in 2004 to USD $116.011 billion in 2011 (Ministry of Commerce of the P.R. China 2012). According to the sixth national census, there were 593,832 foreigners of living in China currently. Including the residents of Hong Kong, Macao and Taiwan, the number reached to 1,020,145 in total, of which 406,917 people came to China for business and employment (National Bureau of Statistics of the P.R. China 2011). The proportion of enterprises founded by the overseas Chinese (including the compatriots of Hong Kong, Macao and Taiwan) was about 70% among the numerous foreign investors’ enterprises, and their investment amount accounted for 60% of the total China had used (Ren 2008). Thus it can be seen that investors in China are generally from neighboring countries or developed countries, and most of them are overseas Chinese with a good economic foundation and strong management ability. Therefore, China needs to strengthen and improve the management system of investment immigration to attract more foreign nationals (not only the overseas Chinese), so as to promote rapid socioeconomic development in China.

4.2 The Migration Status of Foreign Talents in China

4.2.2

87

Foreign Students in China

Since universities in China started recruiting foreign students after 1979, the number of foreign students studying in China has been increasing at average annual rate of around 12%. By the end of 2011, there were about 2.25 million international students from 194 countries and regions studying in China. Figure 4.1 showed that the number of international students in China rose steadily from 265,090 to 397,635 between 2010 and 2015. These international students were from 202 different countries, covering Asia, Europe, Africa, Northern America and Oceania. Asian countries are the main sources of international students in China, account for about 60.4% of total population of international students in China. European students are the second largest proportion of international students in China, including about 4% from Russia (Ministry of Education of the P.R. China 2016). Currently, international students in China mainly come from China’s neighboring countries and other countries with close economic exchanges such as the U. S., France, Germany and so on. In 2015, the top 3 source countries of 202 countries and regions were South Korea, the U.S. and Thailand, the same as the previous years, but Russia, Japan, Indonesia’s ranking declined. In terms of the number of international students in China, the growth of the student body was mainly from Asia and Africa, an increase of 6.5 and 19.74% respectively, of which the number of international students in China increased rapidly from the countries along the area of “the Belt and Road” such as India, Pakistan and Kazakhstan, with a growth rate of more than 10% (Ministry of Education of the P.R. China 2016). This might be one of the potential signs that the multilateral cooperation along the area of the Belt and Road is starting to reveal its positive outcomes from increasing exchanges of people. Distributions of international students in China are scattered across coastal provinces as well as cities with famous universities, concentrated in the east part of the country. As it is showed in Fig. 4.2, Beijing and Shanghai had the largest percentages of international students, east coastal provinces overall have the largest share of international students, while 17% were scattered across the country in 2015. InternaƟonal Students 450 400

11.3

(Thousand)

350 300

265

Annual Growth Rate 12.2 10.4

357

377

398

14 12

328 10

293

250

8.6

200

8 5.8

5.5

150

6 4

100 2

50 0

2010

2011

2012

2013

(Year)

2014

2015

0

(%)

Fig. 4.1 The number and annual growth rate of international students in China between 2010 and 2015. Source Ministry of Education of the P.R. China (2016)

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4 Global Talent Migration: The Barrier and Breakthrough of Foreign …

Fig. 4.2 Distributions of international students in China in 2015. Source Ministry of Education of the P.R. China (2016)

Beijing, 19%

Others, 17% Guangxi, 3% Fujian, 3% Yunnan, 3%

Shanghai, 14%

Heilongjiang, 3% Hubei, 4% Shandong, 5% Liaoning, 6%

Zhejiang, 6% Jiangsu, 6% Tianjin, 6%

Guangdong, 6%

In order to attract international students studying in the country, Chinese governments have been increasing the amount of scholarships for international students. Other than the national government, regional governments such as Zhejiang Province, Jiangsu City, Chengdu City and more introduced regional scholarship schemes and also launched regional scholarships in order to attract more international students to the region. As is shown in Fig. 4.3, increasing numbers of international students were benefiting from these scholarships between 2010 and 2015. According to statistics, the percentage of international students granted scholarships increased from roughly 5% in 2005 to 10.21% in 2015 (Ministry of Education of the P.R. China 2016). Other than funding from national and regional governments, top universities in China also implemented scholarship programs for the purpose of attracting more international students. For example, Tsinghua University, Fudan University, Sichuan University, East China Normal University and Zhejiang University founded the “League of Universities in BRICs,” especially for recruiting international students (Wang and Miao 2015). However, it should also be recognized that compared to traditional destination countries such as the U.S., Canada and the U.K., the number of international students attracted to China is small and the overall quantity of international students

(International Students)

45000 40000 35000

International students with Chinese Government Scholarship The Proportion of the Total Number for the Year 10.5 40600 36943 10.21 10 33322 28768

30000 25000

9.80

25687 22390

9.5

9.35

9

20000 8.78

15000 10000

8.76

8.5

8.45 8

5000 0

2010

2011

2012

2013

(Year)

2014

2015

7.5

(%)

Fig. 4.3 The number and proportion of international students in China with Chinese government scholarship between 2010 and 2015. Source Ministry of Education of the P.R. China (2016)

4.2 The Migration Status of Foreign Talents in China

89

in China still needs to be improved. In 2015, the number of foreign students who received academic education in China totaled 184,799, only accounting for 46.47% of the total number of international students. Among them, the total number of postgraduates and doctoral students was 53,572, an increase of 11.63% compared with the previous year; they mostly learn language, culture and other social subjects (Ministry of Education of the P.R. China 2016). To sum up, as well as large numbers of Chinese international students studying internationally, the number of international students in China is also on the increase. Economic and social developments in China in recent decades are important factors for the population of international students which continue to grow in the country. A series of efforts by Chinese governments are playing an important role in attracting international students. To enhance the exchange of students internationally, the Chinese governments have to further reform immigration policies in China, while universities have to work on programs attracting more international students.

4.2.3

Foreign Skilled Immigrants in China

Compared to foreign students, there is a longer history of foreign skilled migrants working in China. For example, large numbers of scientists from the USSR were involved in the development of scientific research in China during the 1950s and 1960s. As China develops both socially and economically, there is increasing need for a wide variety of highly skilled foreign workers in China. In recent years, we have seen a growing trend of foreign immigration into China, with increasing numbers of people from overseas residing in the country. According to statistics, there were 612,000 foreign experts working in mainland China in 2013, this was an increase of 83,000 people when compared with the 2011 statistics. One route into mainland China for foreign high-level personal is through the acquisition of the Chinese “Green Card,” of which more than 4600 were issued to foreign professionals and their families between 2004 and 2013 (State Administration of Foreign Experts Affairs P.R. China 2015). The growing trend of foreigners coming to China can further be seen in the years between 2008 and 2014, in that time 1306 foreign talents and their families acquired the Chinese Green Card (Xinhua Net 2014). However, despite the number of foreigners coming to China being on the rise in recent decades, the proportion of highly skilled foreign talents in the population is low, especially when comparing it with other countries internationally. Although the number of international talents in China has been increasing at an average rate of double digits, its percentage in the Chinese population has always been lower than 0.1%, whereas the average of such foreign experts in economically developed countries is 10.8%, with a world average at about 3.2%. The proportion of international talents in China is even lower than the average level of developing countries by 1.6% and the average level of the least developed countries by 1.2% (UN Department of Economic and Social Affairs 2013).

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Previous experiences in economically developed countries shows that foreign migrants, especially foreign students and skilled immigrants, are important in pushing forward development internationally. Foreign skilled immigrants play an active role in promoting China’s international exchanges and international cooperation. Moreover, these foreign skilled immigrants serve to encourage the Chinese government to strengthen attraction policies for foreigners in various fields, such as scientific research, education, and industry innovation.

4.2.4

China Become an Attractive Destination

With China’s growing prominence on the world stage, the status of foreign immigrants in China is subject to change as a result of this increased exposure. According to statistics from the International Monetary Fund, based on the evaluation of the purchasing power parity (PPP), China surpassed the U.S. to become the world’s largest economy in 2014. As China enters this new era, people from around the world are immigrating to the country in order to chase the “China dream”. The Expat Explorer Report 2016 produced by HSBC presents a list of the “most attractive countries or regions for expatriates to live in,” China ranked in top 50 out of 190 countries in 2016 (HSBC 2016). China has been on the list since 2011 and possibly earlier, China also ranked third in Expat Explorer Report 2014, only behind Switzerland and Singapore, and this was ahead of many popular migrant destination countries, such as the U.S., Japan, France and the U.K. (HSBC 2014). China’s ranking can be attributed in part to its rapid economic growth, which foreigners and expatriates see as a huge window of opportunity. Furthermore, the lower cost of living in China compared to the developed West, for example, is another attractive factor to foreign immigrants. In the survey of foreigners, China ranked the top in the economic status indicators (including income, wealth and disposable income); in the survey of local economic satisfaction, China was ranked the fifth (HSBC 2014). We found that Asia was one of the most popular countries among foreigners in terms of the point of salary, among them, the proportion whose annual salary was over USD $250,000, which was almost three times as much as in Europe (14% in Asia, 5% in Europe). China was also the most popular Asian country with expatriates and the proportion of the foreigners in China whose annual salary was more than USD $250,000, which was more than four times of the global average (29% for China, the global average was 7%). Improvements to living conditions and economic status, and the visa and settlement mechanisms for international immigrants to China have been though series of reforms. For example, the Management Measures for Foreigners’ Permanent

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91

Residence Approval in China 2004 and the Implementation Rules 2005, along with the 2010 introduction of the National Medium and Long-term Talent Development Plan Outline (2010–2020). In 2013, the new Exit and Entry Administration Law of the People’s Republic of China expanded the original 8 types of visas (including settlement, work, study, visit, tourism, transfer, journalists and so on) to 12 categories, the new added visa categories included R visa (talent visa), Q visa (visiting visa), M visa (business visa) and S visa (relatives visa). This visa type refinement made the visa procedure more targeted and helped to improve the efficiency of visa approval (Ministry of Justice of the P.R. China 2014). Policies in China are also in the process of further reform so that the procedures and documents required for visa and settlement is largely simplified. It might to some extent be positive effects for increasing the number of foreigners coming to the country.

4.3

Global Talent Migration: Barriers and Breakthroughs

Large-scale population mobility has occurred throughout Chinese history. The most famous of which was the migration of people from the Yellow River to the Yangtze River in the Northern Song Dynasty decreasing the developing gap between the two areas. This is only migration within a single nation however. Population and talent are now moving on a global scale influencing political, economic, social, and cultural patterns. Development of the knowledge-based economy with trans-national talent has become a major part of global population mobility. World Migration Report 2013 released by International Organization for Migration (IOM), found population mobility to be 232 million people, with 22% high-skilled immigrants and 33% secondary-skilled immigrants (IOM 2013). Talent immigration has gradually become a growth influence of global mobility.

4.3.1

Normalization of Global Talent Movement

The U.S. has consistently had the largest influx of global talent from all over the world over the last few decades. Even the developed countries and regions, such as the EU, Japan, Australia and Canada, have lost talents to the U.S. As shown in Table 4.1, the population of temporary workers in the U.S. comes from countries across the globe. In 2014, there were about 1.6 million high-level talent people working in the U.S., among these 75% high-level researchers said they would like to stay and keep working in the U.S. Certainly, developed countries such as the U. K., France and Canada receive highly talented workers from developing countries and still have net inflows of talented workers.

4 Global Talent Migration: The Barrier and Breakthrough of Foreign …

92

Table 4.1 Temporary workers and families residing in the U.S. between 2010 and 2015 Countries

Years 2010

2011

Canada 894,237 1,224,619 India 305,530 318,955 Japan 178,817 181,934 The U.K. 129,042 135,490 France 64,438 68,474 Germany 76,163 74,427 … China 40,508 48,912 … Unit People Source U.S. Homeland Security Office of

2012

2013

2014

2015

993,808 327,898 166,891 136,684 68,720 71,321

863,826 369,377 163,922 145,066 72,407 74,328

1,030,104 426,015 177,893 159,122 83,125 83,032

1,122,523 493,426 184,581 164,597 92,198 88,717

49,936

53,736

63,636

76,173

Immigration Statistics (2015)

The reason being may be in the American talent attraction mechanism. Like its global counterparts, the American talent attraction mechanism designed and implemented diverse visa categories for the purpose of covering as much as it can among the population of international talents. Currently five types of visas were designated to international talents to the U.S., including H-1B Temporary workers in Specialty occupations, O1 Workers with extraordinary ability or achievements, L1 Intercompany transferees, E1 Treaty traders and their spouses and children, and finally E2 Treaty investors and their spouses and children (U.S. Homeland Security Office of Immigration Statistics 2016). Meanwhile, the comparison on emphasis between American and European policies in Chap. 2 showed emphasis on the economic contribution such as employment opportunities created might be the better method for attracting talents. Other than attracting established talents, foreign students are a key component of the global talent, are potential permanent residents. According to the statistics of OECD, there were approximately 4.27 million international students in 2011, among which there were 2.03 million in Europe, the largest ever number of enrolled students. North America follows with approximately 0.91 million students. Asia and Oceania are with no more than 0.5 million. Africa has 0.18 million and 0.08 million are in Latin America (OECD 2013). Developing countries in Asia, Africa and Latin America have lost a large number of talents to developed countries. In 2000, six in every ten of well-educated immigrants received by OECD countries were from developing countries. In many African and Latin American countries, more than 30% of people with higher education left to go to OECD countries. Most international students from developing countries chose to stay in western developed countries. Statistics in 2010 found the top ten countries that lost the largest number of talents to be Mexico, India, Russia and China in that respective order. Talents have also returned to emerging countries from developed countries. The flow of talent is gradually changing to no longer be one way. Economic development means the emerging

4.3 Global Talent Migration: Barriers and Breakthroughs

93

countries BRIC (Brazil, Russia, India and China) have improved living standards. This along with increased internationalization has distinctly increased the return of talents. Global talent immigration overall has become more frequent and intense.

4.3.2

Imbalance of Global Talent Flow in China

The scale of China exit-entry personnel flow has consistently increased. From 2007 to 2013, the total number of China’s mainland exit and entry residents increased steadily, 345 million people exiting and entering rose to 454 million people (Bureau of Exit and Entry Administration of the Ministry of Public Security 2013). In 2013, foreigners’ exit and entry into China was 52.51 million, this was 20% higher than 2009 (43.73 million), 3% less than 2011 (54.12 million), and 4% less than in 2012 (54.35 million). Even though the percentage is still lower than that of Hong Kong, Macao and Taiwan residents it continues on a rising trend. Hong Kong, Macao and Taiwan residents’ exit-entry has been decreasing since 2007. In short, global talent mobility in China has had a net outflow (Wang et al. 2015). 4.3.2.1

Imbalance in Flow of High-Tech Talents

According to statistics China as a country has lost the largest number of top talents (Li and Wang 2007). Since 1985, 80% of the high-tech graduates in Tsinghua University have gone to America and 70% from Peking University (China Association for Science and Technology 2008). The majority have Ph.D.s in science and engineering. Almost 90% of Chinese Ph.D.s choose to stay in the U.S. (People’s Daily 2008). China’s current management policies mean foreign students cannot stay in China after graduation. This means the number of foreign students staying in China is close to zero. Report on the Development of World Chinese Entrepreneurs 2008 proved that there were approximately 6 million new Chinese immigrants after 1978 (Chinaqw.com 2009). By the end of 2009, eight scientists of Chinese ethnicity had won the Nobel Prize for natural science, five of these eight were born in China and have Chinese nationality. All of them have or used to have American nationality, with only one from China giving up their American nationality. High-tech talents mainly assemble in developed countries such as the U.S., Japan, Canada and the U. K. The U.S. holds the largest number of high-tech talents. 4.3.2.2

Flows of High-Quality Labor Workers

The quality of Chinese common labor workers is constantly improving. The outflow of Chinese labor is no longer only the lower labor outflow. There is a gap between the outflow talents and immigrant workers in China, irrespective of quantity or quality. Table 4.2 shows that the number of output labor workers

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Table 4.2 Comparison of China’s outflow and inflow of labors stock

Years

Outflow of labors

Inflow of labors

2009 778,000 223,000 2010 847,000 231,700 2011 812,000 241,900 2012 850,000 – Unit People Source Ministry of Human Resources and Social Security of the P.R. China

increased rapidly from 2007 to 2012. The growth rate of output laborers was 13.27% from 2008 to 2012. Inflow workers have increased though they are still less than the outflow of workers. Chinas outflow of laborers in 2011 was 812,000. This contrasts to the 241,900 foreign workers that China had.

4.3.3

Barriers to Global Talent in China

Systematic barriers set by laws can occur when talents try to move across international borders and take residence in foreign countries. Complexity of visa application and residence, policies of international studying and working can all cause barriers to the flow of talents. In comparison to developed countries such as the U.S., Australia, and Canada, China has greater barriers to the flow of talents. Conservative talent-flowing policies in China may largely explain a lack in talent flows.

4.3.3.1

Ease of Talents Migration

According to the Henley & Partners Visa Restrictions Index 2016, countries such as Germany, Sweden, Finland, France, the U.K., the U.S., had the largest number of visa waiver countries at over 174. Eighty-six countries and regions have visa exemption deals with over one hundred countries and regions in the world. China has visa relaxation deals with 50 countries and regions. This number is not only less than Hong Kong (154) and Taiwan (137), but also other BRIC countries-Brazil (153) and Russia (105) shown in Table 1.2 (Henley & Partners 2016). By the end of December 2014, according to Ministry of Foreign Affairs of the P. R. China, China has had visa waiver deals with 93 nations and regions. 81 countries with these visa waiver deals only applied for diplomatic, official business and normal business passports. Only 10 countries allowed people with private passports to enjoy the visa-free policy. Six of these ten gave group-tour visa-free entry. The Seychelles, Mauritius, San Marino and Bahamas allowed people with private passports to come without visas. So the general population does not have access to official visa-free deals. The majority of countries with unilateral visa-free policies for Chinese residents are third world and tourist-island countries. Visa-free or arrival-visa polices reduces the procedure time of visa applications. This leads to more frequent population-flow. China has visa waiver deals with 93

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countries, most of which did not come into being. This highly increases the difficulties of exit and entry, population flow, and high-tech talents inflow in China. Developed countries with a large number of economic, trade and cultural connections haven’t established relevant convenient systems for visa waiver deals with China. This hinders talent-flow, and economic and cultural exchanges between the two sides.

4.3.3.2

Residence Procedures and Difficulties

According to the existing Law of the People’s Republic of China on Control of the Exit and Entry of Aliens and the regulations for the foreigners employed in China, companies employing foreigners need a working visa permit for the foreigner. The company can only employ the foreigner after they have acquired the Foreign Employment License of the P.R. China. Only after foreigners acquire Foreign Employment Permits and Foreigner’s Residence Permits are they able to get jobs in China. If the applicant has the Foreign Expert Permit and is employed by the national organs and institutes, then the Foreign Employment License and Permit is not needed. Foreign Employment Licenses are examined and approved by State Administration of Foreign Experts Affairs P.R. China. Foreigners coming to China to find jobs must go through this process. Figure 4.4 shows the full process. Foreign talents who don’t have networks in China will find it difficult for them to be employed by Chinese companies outside of China. This is partly due to China having no established full-time migration agency. Therefore, the Ministry of Human Resources and Social Security, Ministry of Public Security, State Administration of Foreign Experts Affairs and Embassies are all involved in the process. Foreigners unfamiliar with the Chinese national system may find the visa process and dealing with the large amount of government sectors a difficult obstacle to coming to work in China. This affects global talents inflow into China. Companies help to apply for the Foreigner Employment Permit

Foreigners apply Visas by themselves (Z Visa)

Ministry of Human Resources and Social Security

Apply for Foreign Employment Certificate after Entry

Companies help to apply for Foreign Expert Employment Certificate

Apply for Foreign Residence Certificate

Fig. 4.4 Process of foreign employment in China

Ministry of Human Resources and Social Security Embassy

State Administration of Foreign Experts

Ministry of Public Security

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China began to implement the policy of a Green Card in 2004, the U.S. by this time was releasing 150,000 permanent residence permits for foreign personnel (E class visa of employment) each year, and then in 2012, the total number of Chinese Green Card holders reached 5954, a small fraction of what America issues every year. However, the annual number of H-1B visas (short-term work visa for technology talents) is more than 400,000 in the U.S., the number of foreign talents with a Foreign Employment Permit is just over 200,000 in China.

4.3.3.3

Employment Policy for International Students in China

The current system of government scholarship management has a closed-off management model. It forbids students with scholarships from living out of school or having other study-working activities. This has become one of the key factors that hinder students from coming-to China for educational development. Administrative Rules on the Acceptance of Foreign Students by Colleges and Universities states that to accept foreigners they must exit in a set time after graduation or completion, non-completion, and drop-out. There are no policies on foreign students working in China. If international students want to work in China, they have to work in their homeland after their study period and come back to China as employees. These polices impede some students from working in China. As seen in Fig. 4.5, there were 67,723 Chinese overseas students in the U.S. in 2007. This number rose to 194,029 in 2012 and 274,439 in 2014. Growth rate of American students in China is relatively even from 11,064 in 2007 to 24,203 in 2014. Overall the Sino-American talent flow is imbalanced. For 2014 total Chinese overseas students were 1,088,900, the largest source country of overseas students in the U.S., the U.K., Australia, Canada, Japan, New Zealand. International students studying in China was 377,054 creating a study deficit of 711,846 students.

Chinese overseas students in America

American overseas students in China

300000

274439 235597

250000

(Ten Thousand)

Fig. 4.5 Comparison of the number of Sino-the U.S. overseas students. Source (1) Annual Report on the Development of Chinese Students Studying Abroad (2013), 2013; (2) Institute of International Education (IIE) (2015)

194029

200000 157558

150000 100000

127628 98235 67723

81127

50000 11064

0

2007

13188 2008

13674

13910

14596

2009

2010

2011

(Years)

24583 2012

24203 2013

2014

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4.3.4

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Breakthroughs of Chinese Global Talent Migration

The recent U.S. policies that impose more restrictions on immigration is closing the door to much international talent. However, America’s loss could be China’s gain. China can seize the opportunity to attract more outstanding talent to tackle the problems of its aging population and to find more resources for its development initiatives, such as mass innovation and “The Belt and Road.” The Center for China and Globalization (CCG) proposes 10 measures based on its long-term research. The goal is to build a more open, inclusive and flexible system to improve China’s global competitiveness to attract international talent.

4.3.4.1

Loosen Permanent Residence Permit Conditions

The 20 new exit and entry policy measures formulated by the Ministry of Public Security have been piloted in Zhongguancun, Beijing, since March 2016. The goal is to attract foreign talent and overseas Chinese returnees to work and launch business in Beijing. By the end of 2016, around 155 people have been issued the Chinese Green Cards. China is gaining an upper hand in selecting and recruiting the best international talent in the world. But, there remain shortcomings in China’s permanent residence permit policies that need to be addressed. First of all, the fields where the applicants for the permanent residence permit are allowed to work are still narrow, although the “Regulations for Foreigners with Permanent Residence in the P.R. China” already expanded these fields, allowing foreigners who work in China-based private companies and public institutions or work in Chinese companies and institutions abroad to apply the permanent residence permit. Secondly, it suggests to reduce the time length for which foreigners are required to stay in China before they can apply for China’s green card. Nowadays, the requirement is that applicants need to spend at least three months in China altogether within one year, or at least spend one-year total time altogether in China in the past five years. This requirement should be loosened to make more foreign talent eligible to apply. The third issue is about the large number of documents required for the application for a permanent residence permit. Nowadays, the applicants are required to provide a medical certificate, criminal record in their own countries, and many others. We suggest to allow more hospitals to issue medical certificates to foreigners in China and to help facilitate their obtainment of criminal records without leaving China.

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4 Global Talent Migration: The Barrier and Breakthrough of Foreign …

Reduce Time Required for China’s Green Card Issuance

The Chinese government has been urged to simplify and shorten the procedure for permanent residence permit application, as the lengthy process is already a major barrier that prevents many international talents from applying for China’s Green Card. While it is allowed in the U.S. to issue Green Cards to foreigners even before they land in the country, China Green Cards can be only granted to those who have already been in China for a certain period. This rule can benefit foreign talent already settled in China, but won’t help attract those who reside abroad to come to China and start businesses. CCG proposes to allow foreigners who are interested in business startups in China to apply for permanent residence permits directly from their country. It is also recommended to simplify the entry and exit process for the foreigners working in China and to improve their benefits, such as life insurance, medical services, and education for their children. This would help make China their top choice for working and living abroad.

4.3.4.3

Establish a System to Turn Permanent Residence Permit into Chinese Citizenship

Currently, foreigners can only be naturalized as Chinese nationals through family relationships. There is no policy or regulation that makes other approaches an option. To help qualified foreign talent stay in China for as long as possible, CCG suggests to make it an option to become Chinese citizens for the foreigners who already have obtained permanent residence for a certain period of time, even if they still maintain their original citizenship. For example, a policy can be adopted to allow those foreigners who have China’s Green Card and have spent three-years altogether in China in the past five years without any unlawful activities to apply for citizenship.

4.3.4.4

Lower the Bar for Foreign Students to Enter China’s Job Market

According to current regulations, foreign students who possess Master’s Degrees or within one year after graduating from a Chinese university or a foreign elite university can apply to work in China. This regulation has barred many young foreign students outside China. In 2015, there were 184,799 foreign students who obtained a degree in China, among whom only 53,572 had a Master’s Degree or a Ph.D., 29% of the total. As a result of the policy, over 70% of the foreign students studying and graduating in China are not eligible to apply for a work permit, even though they have been in China for more than four years and already acquired sufficient knowledge about China. So CCG proposes to set up a more flexible system to allow foreign students to get a working visa.

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The first suggestion is to loosen the requirement on the education level of the foreigners who apply for a work visa in China, and to allow outstanding foreign students who have obtained at least a Bachelor’s Degree to enjoy a two-year working visa. It is also important to build an effective link between working visa and student visa. The second suggestion is to scale up the pilot programs in Zhongguancun to welcome foreign students graduating from top Chinese and international universities to come to China for their internships. The third suggestion is to set up an “Internship Program for Global Outstanding Students,” providing international students internship opportunities in China. In 2015, President Xi Jinping at the Asia-Africa Summit Meeting said that China would send 100,000 Chinese to other Asian countries and Africa in the next five years to strengthen bilateral relations. China would also like to invite 2000 students from other Asian countries and Africa to visit China. We propose to allow all the outstanding foreign students graduated from Asian and African countries to apply for internship visa in China, which can be valid for a half-year or one-year.

4.3.4.5

Improve Effectiveness of Working Visa for Foreign Students

In the U.S., the demand for work visa always exceeds the supply. Therefore, the Immigration Bureau adopted a Visa Lottery system. The H-1B work visa processing time is usually between six and nine months, with a high success rate. As opposed to the U.S. system, China does not allow foreign students whose education level is lower than Ph.D. to apply for work visa, because they may not have relevant work experience. This rule leads to the loss of many excellent foreign students who are educated in China after graduation, and also discourages more foreign students to choose China as their top destination to receive international education abroad. CCG proposes to simplify working visa issuance procedure to allow outstanding foreign students with professional skills to stay in China after graduation. It is also important to allow those who may have no relevant degree but advanced skills to stay in China to gain work experience. A system should be established to allow work visas to turn into Green Cards before they expire. The inflow of more foreign talent can help China to upgrade industry and improve innovation, from “made in China” to the “created in China.”

4.3.4.6

Build Systems of Chinese Ethnic Card and Overseas Chinese Identification Certificates

CCG suggests to build a system of issuing identity cards for foreign citizens with Chinese origins. According to the State Council’s “Opinion on Strengthening the Administration of Permanent Residence Services for Foreigners,” there needs to be a channel for the people who have lived in China for long periods and may have

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once had Chinese citizenship to apply for a permanent residence permit. By doing so, overseas Chinese can be brought closer to the motherland. Those who come to China to start their own business in innovation or have a Bachelor’s degree or above should be allowed to apply for “Chinese Ethnic Card” and gain Permanent Residence. The second suggestion is to build a system to issue Overseas Chinese Identity Certificates. Overseas Chinese have Chinese passports, but cannot apply for ID cards with a citizenship number. Therefore, they have to go through a lot of trouble going back to their hometowns in China. The issuance of Overseas Chinese Identity Certificate can be one solution to this.

4.3.4.7

Build Social Security System in Align with International Standard for Foreign Talent

Social security remains an issue for foreigners in China. CCG recommends to set clearer rules for foreigners’ insurance benefits, and to accelerate the procedures to gain recognition of the insurance from other country. China has already signed mutual agreements with some countries such as South Korea and Germany that they can recognize each other’s social security insurance. But the number of such countries needs to be increased. CCG also suggested that foreigners who have paid social insurance for several years in China should be granted a proportionate social insurance before they go back to their homeland for retirement.

4.3.4.8

Formulates Immigration Law and Complete Building of Institutional System

Currently, there are only three major laws in China with regulations on immigrants: the “Foreigners Exit and Entry Administration Law,” the “Rules for the Administration of Employment of Foreigners in China,” and the “Regulations on Examination and Approval of Permanent Residence of Aliens in China.” In order to attract foreign talent, China needs to further strengthen immigration law and to also cover the affairs about foreigners’ employment and life in China.

4.3.4.9

Set Up Immigration Bureau to Optimize Administration and Services

As international migration accelerates, China has already started setting up its own immigration office and preparing specific rules for the management and services in such an institution. However, the pace is too slow to catch up with the rising demand for immigration management.

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Therefore, CCG believes that it is important to accelerate the establishment of an immigration bureau and integrate various functions to create a more efficient and unified system to handle all immigration-relevant affairs. As for the second suggestion, the Immigration Bureau, once established, should carry the function or even play a leading role in attracting foreign talent, as the executive arm of Organization Department of the CPC Central Committee to handle all the relevant issues and establish an international talent information system for research and data management. The third suggestion is to strengthen the Immigration Bureau’s function in immigrant protection and integration. It can protect their safety and properties and establish integration centers to provide language training, cultural exchange and career services. The fourth suggestion is to innovate the management of foreign workers services. One of the key measures is to improve the foreign talent information system that contains the lists of foreign talent, their employment and residence. Using Big Data and the Internet technology, it is possible to set up a tracking system for foreign workers and enable information sharing among the Ministry of Public Security, the Ministry of Human Resources and Social Security and other relevant departments.

4.3.4.10

Promote Policies and Measures to Attract Foreign Talent

China is the biggest developing country with the largest population. It has become a highly debatable issue whether or not China needs more foreign talent. Undeniably, the inflow of more foreign talents in China to start business and work on innovation can bring great benefit for local economy and employment. Therefore, CCG believes it is crucial for the governments at all levels to collaborate with other stakeholders to promote talent development policies and to avoid any misperception and resistance. This is helpful to make China more integrated in globalization and to make foreigners more integrated in China’s society. The second suggestion is to study the U.S. and European countries’ promotion campaign on the global stage, and employ the best practices to elevate China’s reputation in attracting international talent.

4.4

Concluding Remarks

In the context of intense effects of globalization and knowledge economy on talent competition, talent flow is no longer just the redistribution in geographical mobility, and what’s more, human capital as an important production factor reintegrate in the world. Taking into account the economic value of high-tech talents, various countries gradually turn their attention to the flow of talents. How to develop, attract and retain talents become highly regarded as a key to enhance the national

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competitiveness. Usually, developed countries adopt measures, such as reducing the immigration threshold, shortening the visa approval period, visa-free and so on, to promote the fluidity of talents to their own. Objectively, these measures also provide convenience for the nationals to exit the country and are conducive to cross-border exchanges of national talents.

References Bureau of Exit and Entry Administration of the Ministry of Public Security (2013) Comprehensive statistics on exit and entry border inspection 2013. Available at: http://www.mps.gov.cn/ n2254996/index.html China Association for Science and Technology (2008) The report on the development of HRST in China. China Sci Technol Inf 13:6–8 Chinaqw.com (2009) Report on the development of world Chinese entrepreneurs 2008, 2 Feb. Available at: http://www.chinaqw.com/news/200902/02/148817.shtml Henley & Partners (2016) The Henley & Partners visa restrictions index 2016—global travel freedom at a glance. Available at: https://www.henleyglobal.com/files/download/HP/hvri/HP% 20Visa%20Restrictions%20Index%20160223.pdf HSBC (2014) Expat explorer report 2014. Available at: https://www.expatexplorer.hsbc.com/ HSBC (2016) Expat explorer report 2016. Available at: https://www.expatexplorer.hsbc.com/ Institute of International Education (IIE) (2015) Open doors 2015: report on international educational exchange. Available at: http://www.iie.org/Research-and-Publications/Publicationsand-Reports/IIE-Bookstore/Open-Doors-2015/#.WNyzjbF8Ocs International Organization for Migration (IOM) (2013) World migration report 2013. Available at: https://www.iom.int/wmr2013 Li SM, Wang YZ (2007) Global politics and security in 2007. Social Sciences Academic Press (China). Available at: http://www.china.com.cn/aboutchina/data/07zzaq/node_7016038.htm Ministry of Commerce of the P.R. China (2012) Summary statistics on china’s non-financial foreign direct investment. Available at: http://data.mofcom.gov.cn/channel/dwjjhz/dwjjhz. shtml Ministry of Education of the P.R. China (2016) The data of China’s international students in 2015, 14 Apr. Available at: http://www.moe.edu.cn/jyb_xwfb/gzdt_gzdt/s5987/201604/t20160414_ 238263.html Ministry of Justice of the P.R. China (2014) Exit and entry administration law of the People’s Republic of China, 10 Sept. Available at: http://english.gov.cn/archive/laws_regulations/2014/ 09/22/content_281474988553532.htm National Bureau of Statistics of the P.R. China (2011) China’s sixth national census, 29 Apr. Available at: http://www.stats.gov.cn/tjsj/tjgb/rkpcgb/qgrkpcgb/201104/t20110429_30329. html OECD (2013) Education indicators in focus, 5 July. Available at: https://www.oecd.org/education/ skills-beyond-school/EDIF%202013–N%C2%B014%20(eng)-Final.pdf People’s Daily (2008) China became the most fertile american doctoral training base, 8 Sept. Available at: http://edu.people.com.cn/GB/7859256.html Ren GX (2008) China’s policy for overseas Chinese investment and studies on investment from the overseas Chinese since the initiation of reform and opening-up. CPC Hist Stud 1:40–50 State Administration of Foreign Experts Affairs P.R. China (2015) Annual report on chinese international migration (2015), 20 Mar. Available at: http://www.safea.gov.cn/content.shtml? id=12747124

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UN Department of Economic and Social Affairs (2013) International migration 2013: migrants by origin and destination, Sept. Available at: http://www.un.org/en/ga/68/meetings/migration/pdf/ International%20Migration%202013_Migrants%20by%20origin%20and%20destination.pdf U.S. Homeland Security Office of Immigration Statistics (2015) Yearbook of immigration statistics (2010, 2011, 2012, 2013, 2014, 2015). Available at: https://www.dhs.gov/immigrationstatistics/yearbook U.S. Homeland Security Office of Immigration Statistics (2016) Visas. Available at: https://www. dhs.gov/visa-types Wang HY, Miao L (2013) Annual report on the development of Chinese students studying abroad (2013). Social Sciences Academic Press (China), pp 26–28 Wang HY, Miao L (2015) Annual report on the development of Chinese students studying abroad (2015). Social Sciences Academic Press (China), p 216 Wang HY, Liu GF, Miao L (2015) Annual report on Chinese international migration (2015). Social Sciences Academic Press (China), pp 66–84 Xinhua Net (2014) China’s “green card” to continue lowering the threshold, 2 June. Available at: http://news.xinhuanet.com/world/2014-06/02/c_1110955275_2.htm?prolongation=1

Chapter 5

Evolution of China’s Immigration Policies: Visa Polices and Talent Attraction Programs

5.1

Introduction: China’s Immigration Policies Past and Present

Recently, development in China is providing evidence for the importance of international immigration for the country. Recognizing such importance, Chinese governments made numerous efforts for enhancing its international competitiveness in attracting high-skilled talent from abroad in previous decades. It is making a start from national strategies announced and implemented as the policy framework for attracting international migrants. Since the opening-up reform in 1978, the Chinese government has recognised an increased need to attract and retain highly skilled and talented individuals in China. In the initial years since 2000, many initiatives, policies and programs have been designed and implemented with the sole purpose of attracting skilled workers and talent, targeting overseas Chinese and foreign talent alike. In 2002, the CPC Central Committee and the State Council introduced 2002–2005 National Program for Qualified Personnel Development designed to strengthen the national talent production in China (Legislative Affairs Office of the State Council P.R. China 2002), encouraging Chinese students who had gone abroad to return to China, to work and contribute in the strive for economic and innovative development. This program was only one amongst a myriad of plans and strategies implemented throughout the 21st century, some of these reforms set up certain milestones in history of P.R. China, such as in 2004 Measures for the Administration of Examination and Approval of Foreigners’ Permanent Residence in China (Bureau of Exit and Entry Administration of the Ministry of Public Security 2004). These measures were the first legal document in China regarding rights to legal resident for international migrants. As the latest development in the field, the State Council and the CPC Central Committee released three legal documents regarding attracting talents from 2015 to 2016, including Several Opinions of the CPC Central Committee and the State © Springer Nature Singapore Pte Ltd. 2017 L. Miao and H. Wang, International Migration of China, DOI 10.1007/978-981-10-6074-8_5

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Council on Deepening the Reform of Systems and Mechanisms to Accelerate the Implementation of Innovation-driven Development Strategies in 2015, Opinion on Strengthening the Administration of Permanent Residency Services for Foreigners in 2016, and Opinions on Deepening the Reform of Institutions and Mechanisms for Talent Development in 2016 (Gov.cn 2016). Overall, these three documents are similar to other national policy documents, to provide the national policy framework and a clear objective for provincial governments in designing regional policies. The contents of these three documents suggests possible changes in the policy agenda in the Chinese government. First, the immigration policies in China were reformed so that requirements for non-Chinese citizens entering the country were lowered, and procedures required for their visa application to the country was simplified. Further, the government started shifting towards retaining talents in the country. Key reforms in the immigration policies mentioned in these documents are summarized as follows: • Offer foreign high level entrepreneurs and permanent residents the equivalent rights as Chinese citizens; • Create a fast track visa application path for special foreign talents; • Expedite time required for processing applications for permanent residence and work permits; • Relax the admission requirement for applications; • Provide additional assistance for work permit holders; • Further optimising features of permanent resident status. Meanwhile, other than traditional skilled migrants, especially professionals, these documents showed that the immigration system in China is possibly reforming towards those in economically developed countries, such as the U.S. and Canada. The following key points from the three documents are summarized for explanation: • • • • •

Exploring the feasibility for establishing a high-skilled immigration system; Improving immigration policies for investors; Encouraging international students to work in China upon their graduation; Lifting age limits for foreign expertise in high-tech industries; Establishing a market-oriented mechanism for talent selection, and providing discretion in recruiting high-skilled foreigners for Chinese companies.

One of the key reforms summarized in these key points regards rights for international students work during their study in China. The right to work during their studies in the country can be beneficial to both international students as well as the economy in the host country. Traditional migration countries such as the U.S. and the U.K. have policies regarding rights of international students to work during their study in the country. These work experiences are often regarded as influential factors in the decision process by both international students as well as employers. For international students, especially, this means more than temporarily economic

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gain during studies, as their intern experience will be a major factor in securing solid employment in China after graduation. In the bigger picture, this reform is ultimately helpful in retaining future professionals and talents in China. Additionally, other than national strategies such as the three national official documents discussed above, a series of programmes were also designed and implemented by the national and regional governments for talent attraction.

5.2

Promoting the Reformation of Visa Policy in China

In November 2014, the leaders of China and the U.S. announced in the APEC 2014 Summit Meeting that the two countries would issue a 10 year multiple entry visa that can be used for business or tourism activities in both countries. In addition, they will issue a multiple entry visa valid for 5 years for citizens to study in the other country. On March 8th 2015, China’s Foreign Minister, Wang Yi said that China and Canada had made an agreement to mutually issue the 10-year-valid visa, which will be put into effect from March 9th 2015. As China’s becomes more international 10-years-multiple-entry visas could be applied around the world to promote talent flow. Following APEC, China hosted the G20 2016 Summit Meeting. It would help to further China’s global influence and give it the opportunity to attract international talents. In recent years the Chinese visa facilitation process has become increasingly faster. China is also beginning to initiate bilateral institutional arrangements for personnel exchanges. The U.K., the U.S., France, Italy, and other countries are progressively issuing more long-term multi-entry visas for eligible Chinese citizens. The Chinese government’s active role in facilitating visa reforms has won it national support.

5.2.1

Influencing Factors of Promoting the Reformation

China’s world economic status has significantly improved. According to the International Monetary Fund (IMF)’s report, in terms of Purchasing Power Parity (PPP) for 2014, China’s economic scale will surpass the U.S. China’s attractiveness for overseas talent is rapidly increasing, which demonstrated the importance of international immigration for the country, both domestically and internationally. The government of the P.R. China reacted with numerous efforts to appeal to overseas students, foreign experts, professionals and so on. Visa facilitation measures are the first step in promoting talent flow across borders and are also one of China’s current talent barriers.

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5.2.1.1

Exit and Entry Personnel

The number of people exiting and entering is continually increasing. After the financial crisis in 2008, China’s exit-entry personnel growth fluctuated though the overall trend is increasing. China’s exit-entry personnel number saw rapid growth of 9.8% in 2010. Although the total number of exit and entry personnel has been growing, since 2010 the growth rate has slowed down. Growth was 7.6% in 2011, and fell to 4.76% in 2012. In 2013, under the influence of China’s rapid economic recovery, China’s exit-entry personnel number again increased rapidly. Data from Bureau of Exit and Entry Administration of the Ministry of Public Security shows the exit-entry personnel number has grown to 454 million (Fig. 5.1). In 2013, the total number of the exit and entry of mainland Chinese residents reached 195 million. The international economic downturn and the domestic environment of the last two years have influenced the number of foreigners coming to China over the past two years. Despite the decline foreigners travel demand remains large. According to the statistics of the Ministry of Public Security of the P.R. China, in 2013 there were 52.51 million foreigners who exited and entered China. This is a 3–4% decrease compared to 2012 (54.35 million) and in 2011 (54.12 million). The proportion of people exiting and entering accounted for 12% of the total exit and entry personnel for 2013. This was 13% in 2011–2012 (Fig. 5.2). China’s inbound tourism has the ability to grow. According to the statistical data from China National Tourism Administration, China’s inbound tourism has experienced volatility over past years. From 2010 to 2011, the number of tourists increased, though then declined for two consecutive years after 2011. For 2013 China’s inbound tourist number was 129 million, 2.3% lower than 2012

Fig. 5.1 The total number and growth rate of exit and entry people in China between 2008 and 2013. Source Bureau of Exit and Entry Administration of the Ministry of Public Security

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Fig. 5.2 The number and proportion of residents and aliens in China mainland between 2008 and 2013. Source The Ministry of Public Security of the P.R. China

Fig. 5.3 The number of people traveling to China between 2009 and 2013. Source China National Tourism Administration

(132 million) (Fig. 5.3). China’s inbound tourism has the potential to grow further and could take measures to attract foreign tourists to the country.

5.2.1.2

Aging Society

Currently, China has an aging society where there is a shortage of human capital needed for social and economic development. This restricts the development of talent bonuses. In order to further promote development of the whole social

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economy, development of China’s future will shift from reliance on demographic dividends to talent bonuses. Development of domestic talent bonuses to the global talent bonuses will also have an influence. China’s high-level personnel currently have structural problems due to aging. According to one survey, 65% of executives in the State-Owned Enterprises (SOE) are 51–60 years old. SOE executives have an average age of 54 years, while the average age of South Korean company executives is 53 years. Large private Chinese corporations face a better situation. For example, the average age of executives from companies such as Haier or Huawei is only 48 and 46 respectively (China SOE 2013). To adjust the age structure of the population decisions on Major Issues Concerning Comprehensively Deepening Reforms conference on the Third Plenary Session of the 18th CPC Central Committee was held. It was decided that China will launch the “only children couples may have two children policy.” The policy is where parents may have two children if at least one of them is the only child in his or her own family. However, for nearly a year, the “separate two-child” policy did not bring the expected birth rate increase. Its application has had a steady decrease from close to 4000 babies born daily at the beginning falling to around 2400 every day (China Business News 2014). China’s fertility rate is presently far lower than the replacement level. It is predicted in the next 15–20 years there will be a sharp decline in population numbers. The labour decrease is just beginning and the aging process of the population is accelerating. This combination of facts poses a threat to China’s development. The possible problems caused by an aging population means state leaders have begun to pay greater attention to overseas talents. On December 12th 2014, the first national conference themed “studying abroad” was held in Beijing. President Xi Jinping gave strong instructions covering “overall plan studying in China and studying abroad.” After this policy reform for studying in China, large numbers of foreign students in China will face residence or citizenship problems. Under current rules foreign students in China are not allowed to work after graduation, even if they hold a work visa. Thresholds for acquiring a Green Card are also high. Foreigners have stated that due to system obstacles, there is no opportunity for them to have long-term development China. The visa system design is one of the most influential aspects of studying in China.

5.2.1.3

Lack of the Progress in Visa Policy

In 1985, China enacted the Law of the P.R. China on Control of the Exit and Entry of Aliens. A year later, China published Rules Governing the Implementation of the Law of the P.R. China on the Exit and Entry of Aliens. In 2013, the newly enacted Exit and Entry Administration Law of the P.R. China unified the administration of Chinese citizens and foreigners. In the same year, China introduced Regulations of the P.R. China on Administration of the Exit and Entry of Foreigners. According to the data of Bureau of Exit and Entry Administration of the Ministry of Public Security, the new exit and entry administration changed the

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original 8 visa classes to 12 categories, refined categories and targeted formalities help to improve visa approval efficiency. The newly added visa categories are R visa (talent visa), Q visa (visitor visa), M visa (business visa), and S visa (relatives’ visa). Among Q visa, Q1 visa is issued to those who are family members of Chinese citizens or foreigners with Chinese permanent residence (China Green Card holder) and intend to go to China for family reunions and foster care; Q2 visa is issued to those who intend to short term visit their relatives who are Chinese citizens residing in China, or, foreigners with permanent residence (China Green Card holder) in China. Although the exit-entry visa policy for foreigners in China has been loosened, there is still room for improvement. To apply for Q1 or Q2 visa, the new act stipulates that the applicants of Q1 visa should submit a certificate of relationship between family members as well as foster entrustment notarization should be issued by Chinese Embassies/Consulates General in foreign countries; Q2 also requires an invitation letter issued by a Chinese citizen or a foreign citizen with a Chinese permanent residence permit who lives in China. To a certain extent, these clauses have added a new stumbling block in the way of the overseas Chinese to visit home. Meanwhile, the new law and regulations should clearly define the “talents” of the R visa. In accordance with the new exit and entry administration law, the R visa should dole out the high-quality overseas professionals and professionals in short supply whom the country need. However, the new law only stipulates that the applications for R visa should appeal to the introduction conditions and requirements of the high-quality overseas professionals and professionals in short supply approved by the relevant authorities of the Chinese government, and submit the corresponding certifications and supporting documents according to the regulations. Obviously, China has not yet clarified the standards of “talents” which apply to the “talent visa.” This fuzzy definition has become an obstacle to implement the domestic talent visa policy and apply the talent visa for foreigners.

5.2.2

Facilitation of Visa Policies Between China and Other Countries

After the 18th CPC National Congress, with the active promotion of China and other countries, outbound visa facilitation of Chinese citizens was accelerated. China adopted 16 new measures to simplify exit formalities, including online booking for exit and entry certificates. The Ministry of Foreign Affairs of the P.R. China also set up overseas consular service centers in 15 countries. The China consular service website was launched in 2014 strengthened the function of online appointments for “overseas passports,” this provides an online form, appointment, and query progress for overseas Chinese citizens applying for a passport (Ministry of Foreign Affairs of the P.R. China 2014). By February 22nd 2017, there have been 37 countries and regions that signed unilateral visas upon arrival agreements

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for Chinese citizens (China Consular Affairs 2017a, b). As of March 28th 2017, 130 countries have a mutual visa exemption agreement with China (China Consular Affairs 2017a, b). As growing demand of Chinese citizens for studying and doing business and tourism abroad, countries around the world have introduced a variety of positive measures to accommodate for this growing demand and make it easier for Chinese citizens to enter and leave their nation. Schengen countries are planning to set up visa centers in 12 Chinese cities including Jinan, Hangzhou and Fuzhou. Additionally, the EU will create a Schengen visa website to information and guide applicants through the process. Frequent travellers to Europe may apply for a 3 or 5 year multiple-entry visa. On January 27th 2014, the French visa review period for Chinese tourists was shortened to 48 h (People.cn 2014). The U.K. has also implemented a 24-h quick visa service for Chinese tourists that commenced in August 2014 (Xinhua Net 2014a, b). During the APEC meeting in November 2014, China and the U.S. both agreed to issue a new visa which will be valid for 10 years for the citizens of the other country. Japan, Indonesia and New Zealand are all also starting to relax visa conditions for Chinese citizen’s multi-entry visas (Xinhua Net 2014a, b). In contrast, China does not extend the same visa benefits to the U.K., New Zealand, or Japan. There are two main reasons countries around the world chose to reduce visa restrictions on Chinese citizens. Chinese tourists with purchasing power promote economic growth when they travel to other countries. Currently China has the world’s fastest growing outbound travel market, and Chinese tourists spend the greatest amount on travel. According to data from the White House in 2013, 1.8 million Chinese tourists travelled to the U.S., contributing USD $21.1 billion to the American economy. This indirectly created 109,000 jobs. With the issuance of the 10 year visa, it is predicted in 2021 that the number of Chinese tourists for traveling to the U.S. will reach 7.3 million. This is expected to contribute USD $85 billion to the U.S. economy, and add 440,000 jobs (International Finance News 2014). Another purpose is to attract young Chinese students and visiting scholars. 28% of America’s foreign students and exchange visitors come from China (U.S. Embassy-China 2014). Extending student visas to five years is anticipated to attract more students to study in the U.S.

5.2.3

Attracting Overseas Chinese to Return to China

It is estimated that China as a country has the largest amount of overseas communities in the world, with over 60 million overseas Chinese (Overseas Chinese Affairs Office of the State Council 2014). After the 1980s, North America became preferred destination for new Chinese immigrants. In 2015, there are more than 4.52 million people of Chinese ethnicity in the U.S. (China News 2015), and from 2006 to 2015, 2.9 million new permanent residents from China landed in Canada (Government of Canada 2016). Among the overseas Chinese, there are many highly

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educated and skilled people. Canada is the second largest holder of overseas Chinese professionals. A recent survey found on average above 80% of these Chinese professionals in Canada return to China over twice a year (Wang et al. 2015). Many are engaged directly in the China-Canada economic and trade business. Increasing development opportunities in China means more overseas Chinese are choosing to return to China. On February 8th 2014, National Council of Chinese Americans (NCCA), The Union of Chinese American Professional Organizations (UCAPO), Chinese Association for Science and Technology, USA (Cast-USA), Chinese American United Chamber of Commerce (CAUCC), and others all called for the Chinese government to issue an “Overseas Chinese Identity Card,” this would restore the overseas Chinese’s permanent resident status in China.

5.3

Talents Attraction Programs

Other than national official documents regarding the immigration system, programs for attracting talents to the country are also implemented across the country, these programs are also an important part of the talent attraction mechanism in China. 21st century, numerous policies and projects attracting foreign and overseas talent have been introduced both on a National-Level (Table 5.1) and Regional-Levels (Table 5.2). Talent policies on the National-Level include the implementation of policies in ministries and commissions, and on the Regional-Levels, they include introduction and implementation of policies at provincial and municipal levels, in institutions and mass organisations. It is important to note that the Chinese Talent Attraction System not only aims to attract Chinese students who have migrated abroad for educational purposes, or for employment purposes. The Talent Attraction System is also designed to attract foreign talent. Foreign talent is regarded as either highly skilled professionals from business and management; specialists within their respective fields; Professors and Ph.D.s from academic areas considered to be in short supply in China such as for instance science and technology; and foreign experts with a range of other considerable skills.

5.3.1

Thousand Talents Program

Currently, the national program been frequently referred to is Thousand Talents Program, which is the first national program implemented regarding attracting talents from abroad since 2008 and is designed and implemented for overseas professionals and talents whether they have Chinese nationality or not. The program is known for the generous welfare and employment services included in the program. For instance, scholars in the program might be entitled to a RMB 1 million up-front grant from the Chinese government, on top of salary from the

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Table 5.1 National-level talent policies in China Types of talents attractions

Policy

Implementation institute

Year of implementation

Talents Policies of Party Committee

Thousand Talents Plan

2008

Talents Policies of Ministries and Commissions

Thousand Talents Plan of Foreign Experts

Organization Department of the CPC Central Committee State Bureau of Foreign Experts Affairs Ministry of Human Resources and Social Security Ministry of Education Ministry of Education Ministry of Human Resources and Social Security Ministry of Human Resources and Social Security Ministry of Human Resources and Social Security State Oceanic Administration Chinese Academy of Sciences Chinese Academy of Sciences

1994

Chinese Academy of Sciences

2014

National Natural Science Foundation China Association for Science and Technology

2002

Subsidy of Overseas Students Technological Project “Chunhui” Project Cheung Kong Scholar Program Subsidy of High-Level Returnees Plan Overseas Students’ Entrepreneurship in China “Chizi” Plan

Talents Policies of Central Public Institutions

Talents Policies of Mass Organization

Overseas Talents Hunting Plan in Oceanology System during 12th Year Plan Hundred Talents Plan Innovative Team International Partnership Plan CAS President’s International Fellowship Initiative Outstanding Youth Plan HOME Program

2011

1985

1997 1998 2002

2006

2009

2011

2001

2003

Source According to the opening material

institute they are working in. Meanwhile, they are also entitled to a five-year tax exemption, premium medical care and other competitive social welfare services. As for their career development, the Thousand Talents Plan is offering competitive job opportunities, such as taking senior director positions in academic institutions and

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Table 5.2 Regional-level talent policies in China Province

Policy

Year of implementation

Anhui Shanghai Fujian Jiangsu

“Wanjiang” Scholar Program Gathering Overseas High-Level Talents Program “Minjiang” Scholar Program Innovation and Entrepreneurship Talents Hunting Program Special Innovative Research Team Bring-in Plan Gathering Hundred Overseas High-Level Talents Program Gathering Overseas Talents Program Hundreds of Overseas Talents Hunting Program for the Rise of Central China “Liangjiang” Scholar Program Gathering High-Level Overseas Talents Program Hundred Overseas High-Level Talents Program “Sanqin” Scholar Program Ten Thousand Overseas High-Level Talents Program “Zhujiang” Talents Plan Gathering Overseas High-Level Talents Program 555 “Ganpan” Talents Program Prairie Talents Program

2002 2003 2005 2007

Guangdong Chongqing Beijing He’nan

Chongqing Guizhou Yunnan Shaanxi Shandong Guangdong Zhejiang Jiangxi Inner Mongolia Guangxi “Bagui” Scholar Source Government website of various region

2008 2008 2009 2009 2009 2009 2009 2009 2009 2009 2010 2010 2010 2011

state-owned enterprises, as well as assisting the central government to develop the national strategic research plan (1000Plan.org 2017). Compared to other similar programs implemented, the Thousand Talent Program should be regarded as currently the most successful program in attracting international talents. In the nine years since it was first implemented, the program has attracted more than 6000 international professionals to the country. According to official data available, currently scholars attracted by the program are concentrating on the eight fields from business and natural science schools, including bioscience, energy and environment, economics and business administration, IT, engineering and material, innovative technologies, chemistry, mathematics and physics (Chinesetalents.cn 2015). Additionally, other benefits offered by the national government, regional governments and institutions are also offering generous amounts of research grants as well as welfare to successful applicants to the program. This in fact is evidence that regional governments are also competing for global talents and are seeking to attract them to the region. To some extent such competition between regions is further evidence that China as a country requires large numbers of skilled migrants, especially professionals, and across many disciplines.

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5.3.2

Talents Attraction Program in Provincial/Municipal Level

Other than the national government, regional governments are also actively designing and implementing policies and programs for attracting international talents. This is especially the case with economically developed regions such as Beijing, Shanghai, Fujian Province and more. Under guidance of the three national documents discussed earlier in the chapter, regional programs are designed and implemented according to requirements of regional developments. For example, while Beijing is one of the cities facing increasing demand for international migration without Chinese nationality, demanding longer stay for themselves and their family; Fujian Province is an example of meeting demands of long-term stays for international migration with Chinese nationality, which means more diasporas and returnees. This section of the chapter will briefly discuss such programs in four regions, as examples of regional programs in the country, including Beijing, Shanghai, Fujian Province and Zhejiang Province.

5.3.2.1

Beijing

As the capital of the P.R. China, Beijing has large numbers of international immigrants, including students, skilled workers and professionals. By 2012, there were around 20 million foreigners living in Beijing, of which 721 foreigners had been granted China’s permanent residence (Phoenix News 2012). With the increase in the number of international students and skilled migrants, Beijing Municipal People’s Government is reforming the regional immigration regulations to attract more high-quality overseas professionals and highly-skilled workers to Beijing. On March 1st 2016, the Twenty Exit and Entry Measures to Support Innovation and Development of Beijing were implemented by The Ministry of Public Security of the P.R. China, involving Visas, Exit and Entry, Residence Permits and so on (The Ministry of Public Security of the P.R. China 2016). The major reform targets could be categorized into four foreign talents, including high-quality overseas professionals, self-employed overseas Chinese Returnees, international students and foreign members of entrepreneurial team; whose which were in active demand by the innovation and development of Beijing in its present stage. These measures focus on resolving the policy bottlenecks that restrict attracting all kinds of foreign talents, to test policies in the Zhongguancun Science Park. For example, recognized high-quality overseas professionals working in Zhongguancun are eligible to apply the permanent residence permit if their income exceeds a certain threshold or Min. 4 years’ experience in Zhongguancun. Also the examining and approving period of the permanent residence permit has been shortened from 180 working days to 50 working days. Meanwhile, it is the first time that China has offered the short-term work permit in Zhongguancun to international students who graduated from China’s higher educational institutions. This reform is the first of such legal

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documents which state the rights for international students to work in China. However, it is still limited to international students hired by state-owned enterprises. Other than these reforms above, the integral evaluation system in the Zhongguancun Science Park is one of the piloting programs for talent development in China as well as one of the immigration system widely used in Canada, Australia, the U.K. and so on. Following the invocation of the integral evaluation system at the beginning of 2016, the experience of it in the Zhongguancun Science Park can be regard as a development of China’s talent attraction policies towards a more practical and market-oriented structure.

5.3.2.2

Shanghai

New Talent Policies seek to introduce talent according to the local cities’ own requirements. As one of the largest cities in China, Shanghai Municipal People’s Government implemented and reformed a series of new talent policies in recent years. In July 2015, Suggestions on Deepening System Mechanism Reform of Talent Management and Improving Innovation and Business Startups of Talent were implemented by Shanghai Municipal People’s Government, including four parts and 20 items (Shanghai Municipal People’s Government 2015). The new legal documents established a market-oriented talent accreditation system, created a fast track application process for permanent residence, and expanded the talent pool by granting a special two-year residence permit to foreign graduates who are willing to do internship or entrepreneurial activities in China. One year after new measures were implemented, Shanghai saw a six-fold year-on-year increase in the number of permanent residence applications from foreigners and their families. The number of such applications in Beijing last year increased 426% from that of 2015 (Cankaoxiaoxi.com 2017).

5.3.2.3

Fujian Province

Compared to increasing numbers of international migrants with non-Chinese origins in Beijing and Shanghai, international migrants in Fujian Province are mainly formed of Chinese returnees because of Fujian Province is one of the regions which has large numbers of diasporas abroad. Due to the rapid economic development in China, large numbers of diasporas joined the wave of international migration to China. Therefore, the target population of New Talent Policies in Fujian Province is different from Beijing and Shanghai. For instance, the Talent Residence Permit was implemented to specifically target high-quality overseas Chinese professionals in Fujian Province. According to the Interim Provisions on the Management of Residence Permit in Fujian Province, numerous benefits are attached to the permit, including housing, access to public social security, education for their children and registering for their businesses in the region (Fujian Provincial People’s

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Government 2011). By enabling their welfare of living and working in the city, Fujian Province is looking at retaining as well as attracting talents in the region.

5.3.2.4

Zhejiang Province

The Chinese professional returnee is one of the main groups of international talents for most regional governments in China, especially economic developed areas along the coast. Other than Fujian Province, Zhejiang Province is another example of provincial talent programs, especially designed for attracting Chinese professional returnees coming back to China for work. Seagull Program was initiated by Zhejiang Provincial People’s Government in 2011. At the beginning, the purpose of this program was to target leading academics and top-tier research talents in IT and pharmaceutical industries. From 2016 to 2017, the program started to open to researchers in the natural sciences and engineering disciplines who are willing to work in Zhejiang Province for more than three years. Successful candidates of the Seagull Program will be eligible for residence permits, a governmental reward fund RMB 500,000 and more welfare such as insurance, medical, exit and entry and so on (The People’s Government of Zhejiang Province 2017). The above are four examples of the regional talent programs in China. Other than Beijing, Shanghai and coastal regions, regional governments across the country are designing, implementing or reforming the regional talent programs in order to attract more high-quality overseas professionals to work in the region. It should be recognized that the different regional talent programs are designed and implemented in regions at different stages of development, for different target populations, during various periods. Compared to the unified immigration systems in Canada, Australia, the U.K. and so on, the division of talent programs between National-Level and Regional-Levels face new challenges in building a talent system and mechanism in China. However, the reform of major projects for talent development could result in a skilled, diversified and multilevel overseas workforce supporting the economic development of China, especially speeding up efforts to upgrade its industrial structure.

5.4

Polices for Retaining Talents

Other than reforming talent programs and policies for high-quality overseas migrants coming to China, the government implemented numerous reforms on welfare, employment and daily life of foreign migrants to retain the talents in the country and extend the scope for talent hunting.

5.4 Polices for Retaining Talents

5.4.1

119

Welfare Services for Permanent Residents

Currently, there are approximately 600,000 foreigners believed to be living in China. Apart from perfecting the policies for the development of overseas human resources and create good environments for attracting gifted people, the Chinese government is aware of the importance of retaining talents in order to fully realize the human resource value they represent. Therefore, Measures for Entitlements of Foreigners with Permanent Residency in China and Provisions on Providing Entry and Residence Conveniences to Foreign High-Level Talented People were both announced in 2012 (The Central People’s Government of the P.R. China 2012a, b). According to these two documents, foreign talents in China access to rights and responsibilities are the same as Chinese citizens, including social welfare and security, taxation, housing, education for their children and so on, except certain responsibilities and rights strictly limited (e.g. suffrage and military service). Meanwhile, the eligibility requirements for permanent residence in China has been relaxed. To qualify for a Green Card, a candidate has to either be a “high-level foreign professionals helping with China’s economic, scientific and technological development or social progress,” making an outstanding contribution to the country, investing over USD $500,000 in China or who have direct relatives who are Chinese nationals. China began to allow permanent residence in 2004, but from 2008 to 2014, only 7356 foreigners were granted permanent residence cards, based on recommendations from ministries or provincial governments (Wang and Liu 2014). Since September 2015, the Chinese government has made some progress in easing its residence and entry policies for foreigners, which has helped retain more overseas talents, as well as boost international exchanges and the economy. In 2016, a total of 1576 foreigners were granted Chinese permanent residence, which is widely regarded as the world’s hardest-to-get Green Card, an increase of 163% from the previous year. The surge is closely related to the pilot programs launched in Chinese metropolises in recent years and reflects China’s push to tap into more international talents to increase the country’s global competitiveness (Global Times 2017). Despite reforms by the Chinese government so far, the immigration system in China for attracting talents is still lagging behind most of the developed countries, especially those that are experienced with attracting international talents. Nevertheless, reforms in the Chinese immigration system, especially permanent residence policies should be recognized as successful. The rapid increase in the number of Green Cards shows China is pushing to retain more international talents and make it easier for them to become permanent residents. It will also help in attracting more overseas students.

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Expanding the Talent Hunting Scope

Personnel selection in the over 7 billion population of the world, is being utilized to create a cosmopolitan “China dream.” Aside from sports, China’s universities and research institutions have stepped up their appointments of foreign professionals, utilizing programs such as the Recruitment Program for Foreign Experts initiated in late 2008 to attract high-level talents from overseas. As China provides more opportunities for foreigners, a growing number of foreigners are choosing China for investment and business. The Chinese government also reformed immigration policies to expand the scope for talent hunting. Regulations of the P.R. China on Administration of the Exit and Entry of Foreigners was announced in 2013 by the State Council, this policy added four new visa categories (M, Q, R, and S) to the immigration system, which is regarded as another milestone reform in Chinese immigration policy (Bureau of Exit and Entry Administration of the Ministry of Public Security 2013). Among them, the R visa (talent visa) is especially designed for high-quality overseas talents and scarce professionals, but it does not apply to the most foreigners. An applicant for the R visa must be a foreign talent recruited through the Thousand Talents Program, or have other sufficient materials for proofing their eligibility as well as being approved by the State Administration of Foreign Experts Affairs P.R. China. Once an application is successful, the eligible applicant with an R visa can be entitled to a fast track application to local employment and a residence permit. It should be recognized that the Chinese government makes great efforts to support the high-level talents, and has set aside the special R visa category for this purpose.

5.5

Future Possibilities to Promote China’s Immigration Policies

From discussions about recent reforms in the Chinese immigration system to reforms targeting talent management, the Chinese governments have always attached high importance to international talents. In recent years, the implementation of these reforms concerning the facilitation of application process, social welfare policy and social security policy have lead to the number of international talents with permanent residence permits significantly increasing, retaining very many high-quality overseas professionals in the country (Xinhua Net 2015). Such an increase in the approved applications for foreigners to gain permanent residence in China is a result of the country’s fast development, increasing attractiveness and more open environment. By owning such Green Cards, foreigners working and living in China have the same rights (except for political rights) as Chinese citizens. For many years, however, gaining a Chinese Green Card has been difficult, due to the high threshold, lengthy application procedure and limited quotas. Issuing

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only 1576 Green Cards a year is far from enough to meet the country’s current needs, which means it should upgrade its old system for the management of foreign talents. In fact, since September 2015 when the authorities issued guidelines for improving the management system for foreigners, China has increased the number of Green Cards issued to foreigners. Compared with countries such as the U.S., China’s Green Card system is still in its early stages and continuous improvements should be made to it (China Daily USA 2017). The Chinese government should increase the annual quota and, more importantly, increase the “gold content” of these cards to offer the holders greater conveniences in finance, healthcare and legal services. Facing these challenges, this section makes five suggestions for the future development of Chinese talent policies. Firstly, to establish a national immigration bureau. Multiple ministries and bureaus in China are currently jointly involved in administration of immigration affairs. Such fragmentation in administration is one of the important reasons for the inefficiency in processing applications, which received complaints from foreign talent applicants for the inconveniences caused. Establishment of a single immigration bureau in China will have two major benefits. The bureau can concentrate different resources for the administration of all affairs relating to immigration. Therefore, process of administration regarding immigration affairs can be largely simplified, as well as preventing duplication of resources. Meanwhile, with the administration of immigration affairs concentrated to one bureau, implementation and evaluation of immigration policies can become more efficient for the Chinese government. Secondly, to adopt the points-based immigration system nationally. As Yale-Loehr and Hoashi-Erhardt (2001) argued, when properly designed and implemented, the points-based system can be a comprehensive and transparent mechanism for gauging skilled immigrants, as well as enabling countries’ abilities to attract suitable human capital according to economic needs. In June 2016, the piloting programme in Beijing launched a points-based system with a special focus on entrepreneurial talents and high-profile professionals in Zhongguancun Science Park. As the first points-based system in China especially targeting international migration, it can be easily recognised that the system is at a preliminary stage. For example, clarifications of certain terms are still required, while implementation of the policy is still unclear. However, like other policies in China, and points-based systems internationally, it is through continuous reform that the system can be improved overtime. Thirdly, the high levels of requirements for permanent residence applications should be lifted. For example, as discussed earlier, as levels of requirements for qualifications are lifted, the numbers of foreign talented applicants increased. This might be evidence that as the requirements in terms of qualification for the application, which is starting from Ph.D. and up, is too high. Therefore, to suggest lowering requirements in levels of education from Ph.D. to master degrees, reduce the requirement for working experience to less than four years, and expanding the attraction pool to the other fields of studies, such as humanities, social sciences and

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arts. Previous experience suggests it might then attract more international talents coming to the country. Fourthly, to promote an effective information sharing mechanism between regional governments across the country. Such a mechanism can distribute across the country successful experiences as well as lessons in attracting international talents. As discussed earlier, other governments in Beijing, Shanghai, Fujian province are implementing policies and programmes for attracting talents, and other regions across the country are also implementing similar policies and programmes. In cases that such experiences can be shared across the country, new policies and programmes, or reforms can be developed based on these experiences and lessons. Meanwhile, learning from experiences in the process of implementing policies is one of the main reasons for policy piloting schemes in China (People.cn 2016). Therefore an effective information sharing mechanism is important here as it might also become a precious reference for the local governments in designing and formulating their own regional talent policies. Finally, the recommendation to the Chinese government is to increase participation in international immigration affairs. International immigration to China after 1979 is one of the new topics for the Chinese government. Compared to experienced immigration countries such as the U.S., the U.K. and other European countries, the immigration system in China is at a preliminary stage. By increasing participation in international migration administration, the Chinese government can learn from successful experiences and lessons from countries experienced with international migration.

5.6

Concluding Remarks

Becoming a member of the International Organization for Migration (IOM) in 2016 was the initial step taken by the Chinese government to increasing participation in global administration of international immigration. The dual effect of continuous positive economic development in China and reform in the immigration system in China is going to attract increasing numbers of international migrants to the country. Meanwhile, as discussed in previous chapters, China is one of the largest sources of international migrants. In order to manage the largest population of international migrants leaving the country, as well as the increasing numbers of international migrants entering the country, becoming a member of the IOM can offer the Chinese government opportunities in managing international migration. The IOM is the largest international organisation especially for international migration, which was also recognised by the UN as one of its official organisations. This means the involvement of the IOM on issues of international migration will increase in the future. By actively involving in the IOM, the Chinese government can have a better picture of the contemporary international migration globally. Meanwhile, through increasing involvement in administration of international immigration from the IOM, the Chinese government can learn advanced

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experiences on the field, as well as increase international influence of the Chinese government on international migration in the future.

References Bureau of Exit and Entry Administration of the Ministry of Public Security (2004) Measures for the administration of examination and approval of foreigners’ permanent residence in China (外国人在中国永久居留审批管理办法), 15 Aug. Available at: http://www.mps.gov.cn/ n2254996/n2255000/n2255012/n4974587/c5012426/content.html Bureau of Exit and Entry Administration of the Ministry of Public Security (2013) Regulations of the P.R. China on administration of the exit and entry of foreigners (中华人民共和国外国人 入境出境管理条例), 28 Aug. Available at: http://www.mps.gov.cn/n2254996/n2254998/ c4221567/content.html Cankaoxiaoxi.com (2017) China issued “green card” to more foreigners, foreign media: to attract overseas talents, 7 Feb. Available at: http://www.cankaoxiaoxi.com/china/20170207/1664984. shtml China Business News (2014) Experts recommend the full release of two births, 29 Dec. Available at: http://money.163.com/14/1229/02/AEJLREPH00253B0H.html China Consular Affairs (2017a) List of entry benefits for chinese citizens with ordinary passports to the relevant countries and regions, 22 Feb. Available at: http://cs.mfa.gov.cn/gyls/lsgz/fwxx/ t1185357.shtml China Consular Affairs (2017b) List of mutual visa exemption agreement between China and foreign countries, 28 Mar. Available at: http://cs.mfa.gov.cn/gyls/lsgz/fwxx/P0201703293946 82090353.doc China Daily USA (2017) “Green Card” system still young, 8 Feb. Available at: http://usa. chinadaily.com.cn/epaper/2017-02/08/content_28137584.htm China News (2015) The latest data indicated that the total number of Chinese ethnicity reached 4.52 million in the U.S. with highly-educated, 4 May. Available at: http://www.chinanews. com/hr/2015/05-04/7249459.shtml China SOE (2013) Survey on the executive age of SOE: many over-age executives, 28 Mar. Available at: http://news.xinhuanet.com/fortune/2013-03/28/c_124514207.htm Chinesetalents.cn (2015) The performance of thousand talents program, 16 Nov. Available at: http://www.chinesetalents.cn/homepage/showinfo/512aa976-c0af-42d8-b39b-a2f84999d34b Fujian Provincial People’s Government (2011) Interim provisions on the management of residence permit in Fujian Province, 19 Dec. Available at: http://www.fujian.gov.cn/fw/zfxxgkl/xxgkml/ jgzz/gtzycxjs/201112/t20111231_439817.htm Global Times (2017) China issues 1,576 “green cards” to foreigners, 6 Feb. Available at: http:// www.globaltimes.cn/content/1031666.shtml Gov.cn (2016) Several opinions of the CPC central committee and the state council on deepening the reform of systems and mechanisms to accelerate the implementation of innovation-driven development strategies (中共中央国务院关于深化体制机制改革加快实施创新驱动发展战 略的若干意见), opinion on strengthening the administration of permanent residency services for foreigners (关于加强外国人永久居留服务管理的意见), opinions on deepening the reform of institutions and mechanisms for talent development (关于深化人才发展体制机制 改革的意见). Available at: http://www.gov.cn/index.htm Government of Canada (2016) Chinese immigrants to Canada, 31 Mar. Available at: http:// canadaimmigrants.com/chinese-immigrants-to-canada/ International Finance News (2014) Go, the visa is relaxed, 1 Dec. Available at: http://paper.people. com.cn/gjjrb/html/2014-12/01/content_1504721.htm

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Legislative Affairs Office of the State Council P.R. China (2002) 2002–2005 national program for qualified personnel development (2002–2005 年全国人才队伍建设规划纲要), 7 May. Available at: http://fgk.chinalaw.gov.cn/article/fgxwj/200205/20020500277390.shtml Ministry of Foreign Affairs of the P.R. China (2014) Ministry of foreign affairs 2014 annual report on government information disclosure. Available at: http://www.fmprc.gov.cn/web/wjb_ 673085/zfxxgk_674865/xxgknb_674875/t1249998.shtml Overseas Chinese Affairs Office of the State Council (2014) Over 60 million overseas Chinese distributed in the 198 countries and regions, 5 Mar. Available at: http://news.xinhuanet.com/ politics/2014-03/05/c_126225434.htm People.cn (2014) French foreign minister: France will launch 48 hours visa services to Chinese tourists, 15 Jan. Available at: http://world.people.com.cn/n/2014/0115/c1002-24127670.html People.cn (2016) A series of general secretary Xi Jinping’s important speech, 2016 edn, 26 Apr. Available at: http://politics.people.com.cn/n1/2016/0426/c1001-28303571.html Phoenix News (2012) Foreign nationals to Beijing will obtain 72 hours visa-free treatment, 28 May. Available at: http://news.ifeng.com/gundong/detail_2012_05/28/14853928_0.shtml 1000Plan.org (2017) The recruitment program of global experts. Available at: http://www. 1000plan.org/qrjh/section/2?m=rcrd Shanghai Municipal People’s Government (2015) Suggestions on deepening system mechanism reform of talent management and improving innovation and business startups of talent (关于深 化人才工作体制机制改革促进人才创新创业的实施意见), 6 July. Available at: http://www. shanghai.gov.cn/nw2/nw2314/nw2315/nw4411/u21aw1029041.html The Central People’s Government of the P.R. China (2012a) Measures for entitlements of foreigners with permanent residency in China (外国人在中国永久居留享有相关待遇的办 法), 12 Dec. Available at: http://www.gov.cn/zwgk/2012-12/12/content_2288640.htm The Central People’s Government of the P.R. China (2012b) Provisions on providing entry and residence conveniences to foreign high-level talented people (关于为外籍高层次人才来华提 供签证及居留便利有关问题的通知), 13 Dec. Available at: http://www.gov.cn/zwgk/201212/13/content_2289584.htm The Ministry of Public Security of the P.R. China (2016) Twenty exit and entry measures to support innovation and development of Beijing (支持北京创新发展20项出入境政策措施), 12 Jan. Available at: http://www.mps.gov.cn/n2253534/n2253535/n2253537/c5129880/ content.html The People’s Government of Zhejiang Province (2017) Announcement on the introduction of high-quality overseas professionals to Zhejiang Province in 2017, 1 Mar. Available at: http:// www.zj.gov.cn/art/2017/3/1/art_12371_2219974.html U.S. Embassy-China (2014) Situation description: supporting the employment growth and strengthen the relationship by extending tourists, business travelers and students visa valid period, 10 Nov. Available at: https://china.usembassy-china.org.cn/zh/category/consul-general-zh/ Wang HY, Liu GF (2014) Annual report on Chinese international migration (2014) Social Sciences Academic Press (China), pp 21–22 Wang HY, Liu GF, Miao L (2015) Annual report on Chinese international migration (2015) Social Sciences Academic Press (China), p 61 Xinhua Net (2014a) The visa application of Chinese visitors to the U.K. will be approved within 24 hours, 18 June. Available at: http://news.xinhuanet.com/2014-06/18/c_126637331.htm Xinhua Net (2014b) Issuance of a 10-year visa between China and the U.S., unchanged standard of the eligibility application, 15 Nov. Available at: http://news.xinhuanet.com/overseas/2014-11/ 15/c_127212810.htm Xinhua Net (2015) “One Belt and Road” surge the inflow of overseas talents, China Usher economic growth impetus, 18 Apr. Available at: http://news.xinhuanet.com/politics/2015-04/ 18/c_1115012850.htm Yale-Loehr SW, Hoashi-Erhardt C (2001) A comparative look at immigration and human capital assessment. Cornell Law Faculty Publications, Paper 1097, Available at: http://scholarship.law. cornell.edu/facpub/1097

Chapter 6

Suggestions on Establishing the Internationally Competitive Talent Immigration System

6.1

Introduction: The Status Quo of Talents Immigration in China

At present, China international talent is under unprecedented attention. Since 18th CPC National Congress report mentioned “to open the door for recommending virtuous people, to introduce talent from the world,” “to form a internationally competitive system to stimulate the creativity of talents, and create a vivid situation that everyone can achieve success, everyone can develop their talent.” General Secretary Xi Jinping, has made over 30 times important discourses on talent, and continuously mentioned “international talent” many times in his speeches. In October 2013, at the 100th anniversary of the Western Returned Scholars Association conference, the General Secretary pointed out that “to the world of governance lies in the talent,” “talent is the important index to measure a country’s comprehensive national strength. The comprehensive national strength competition is the talent competition. In the end, who can cultivate and attract more excellent talents will win the advantage in the competition.” He emphasized on “to full develop and utilize the domestic and international talent resources and actively introduce and make good use of overseas talent.” In the Central talent work coordination group 2013 work report, General Secretary Xi Jinping pointed out that “to choose and use the talent from the world…To break the ideas that hinder talent development, and promote the system and mechanism reform and policy innovation, fully stimulate the creativity of all kinds of talent…” In May 2014, Xi Jinping in discussion with foreign experts pointed out “China will always be a learning country, regardless of what level of development, we will have open mind to learn from people all over the world,” and “to be the ocean, don’t refuse the streams.” “Opening to the outside world, a country must first promote the openness of the people, especially the talent.” “To implement a more open talent policy, not only based on the regions, to try to develop the talent, and not stick to one pattern to make good use of the talent…more actively introducing more foreign talent, © Springer Nature Singapore Pte Ltd. 2017 L. Miao and H. Wang, International Migration of China, DOI 10.1007/978-981-10-6074-8_6

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especially high-level talent.” During December 12th–13th 2014, at a national overseas study conference, Chairman Xi emphasized that “under the new situation, overseas study needs to adapt to the developing trend of country and the nation’s overall condition to make overall plan of studying abroad and studying in China, to make integrated use of the international and domestic resources to train more talents and create a new situation of overseas study.” General secretary Xi Jinping’s proposition of “choosing the world’s talent and make good use of it,” and the “integrated use of international and domestic resources” showed great foresight of selecting talent from the world and welcoming international talent with an open mind.

6.2

Overseas Chinese Roles in Enhancing “The Belt and Road” Initiative

“The Belt and Road” is under the new normal state, China’s important development philosophy of opening its door to the world and boosting cooperation and peaceful development in the world. From Beijing to Moscow to Northern Europe, from Beijing to Europe via the middle Asia continent, and from the southeast coast of the continent of Africa via Southeast Asia and South Asia, The Belt and Road extends throughout the Asia, Europe and Africa. From the perspective of the direction of Chinese immigrants in history, The Belt and Road is the “road map” of Chinese people towards the world. More than two thousand years ago, the Chinese people started from Chang’an, crossed the middle Asia and finally arrived at Europe, which opened up the “Silk Road” on land. From the southeast coast, they broke the heavy waves the Southern Ocean and the Atlantic Ocean and established a “Maritime Silk Road” as well. According to statistics, at present there are more than 40 million Chinese living in Southeast Asia, with the majority in Thailand, Indonesia, Singapore and Malaysia, and they are the main force behind China’s “Maritime Silk Road” in the 21st century. At the same time, after the Reform and Opening up, out of the 9.34 million international immigrants, most of them are in North America and Europe, with some distributed in central Asia and Africa. They have become the bridge and links to strengthen the communication between China and Europe, China and Africa, and will play an important role in the Belt and Road initiative in the future. China’s overseas immigrants obtain employment from more diverse industries, and their economic strength has seen a great improvement. They are gradually integrated into the local mainstream society and their political and social status has improved. They are the carrier of Chinese “hard power” overseas, such as carrying out business investment, innovation, entrepreneurship and other economic activities; and also are the carrier of national “soft power,” such as the inheritance and dissemination of Chinese culture. They are playing an important role in promoting

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the development of emerging industries, guiding foreign investment, helping Chinese enterprises to “go global” and promoting science and technology, cultural exchanges, telling the Chinese story, spreading the Chinese voice and carrying out public diplomacy. When implementing the Belt and Road initiative, we cannot ignore the support of international talent. And the Chinese international immigrants have natural advantages in promoting the Belt and Road initiative in the countries and regions related with the initiative. First of all, they have Chinese ancestry and have certain “home” feelings toward China. Second, they have relatives in China, relatively understand more about the Chinese culture, are easier to blend in with Chinese society, and agree with home values. Third, many of them have businesses in China, and are familiar with foreign culture, environment, and law. Some have even founded their own enterprises abroad, which can be the important node in promoting the Belt and Road initiative. Therefore, China should actively develop the advantages of overseas immigrant groups to encourage and actively create conditions for them to participate in the construction of the Belt and Road. At the same time, we should have a more open vision and broad mind to set up the corresponding systems to defend the legitimate interests of overseas immigrants, by letting them feel the care and help from the home country, thus contributing to the motherland more consciously.

6.3

Suggestions on Establishing a Systematic Immigration System

At present, China mainly adopts the administrative management mode combined with the foreigners employed in China, foreign experts working in China, returned students and foreign students in China, as well as foreigners in China who have permanent residence. There is no connection between each model, as there is no coherent system. The so-called Talent Immigration System is a progressive policy system composed of visa, Green Card and naturalization. This system standardizes the international talent entry, work, residence, and naturalization, and is a set of introduction, selection and evaluation of talent recruitment mechanisms, which provides the basic guarantee and supporting policies for the top talent from all over the world to come to China to seek development, make contributions and settle down (Wang 2013). Among them, the visa method deals with short-term flow, and the behavior of brain circulation, to avoid the burden of non-long-term needed talents to stay. The Green Card and naturalization are used to welcome long-term needed talents and outstanding talents permanent inflows to eventually become naturalized into the native talent. There is a focus to the construction of the talent immigration system. First, to speed up the cohesion of student visa and work visa, let loose the limitation for

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foreign students to work in China after graduation, to design the temporary work visa for the graduates to look for work in China and the conversion to work visa, to open the path of “to find a job in China, get a work visa, apply for a Green Card, naturalization” to keep the outstanding foreign students in our country. Second, to speed up the study and establishing the Investment Immigration Law and Skilled Immigration Law. Third, to set up the dedicated immigration management agencies. Fourth, to improve the system of economic immigrants, liberalize investment immigrant and skilled immigrants. Lastly, the fifth, to complete related immigration systems by including irregular immigration and family immigration.

6.3.1

To Accelerate the Study of the “Investment Immigration Act” and “Skilled Immigration Act”

Regarding entry, residence and immigration management, China’s relevant laws include The Exit and Entry Administration Law of the P.R. China, which was amended at the end of June 2012 and implemented in July 2013; the Regulations on the Management of Employment of Foreigners in China implemented in 1996; and the Measures for the Administration of Examination and Approval of Foreigners’ Permanent Residence in China implemented in 2004 (Wang 2013). The three laws specified the regulations for foreigners regarding entry and exit, employment and permanent residence in China. In recent years, China has issued a series of regulations on introducing overseas high-level talents such as raising green card benefits, as an important basis for the introduction of high-level talents. Over the past ten years, China has made great efforts in introducing overseas high-level talents, but for the most part they have been overseas Chinese. For the overseas high-level talents, China has no “Investment Immigration Law” or “Skilled Immigration Law,” only the corresponding policy documents. There are more than 20 related departments involved in overseas high-level talent management, and there is no clear provisions, so it is very hard for the foreign talent to be aware of their existence or the content. Because this foreign high-level talent issue involves foreign affairs, it is highly sensitive. In this sense, the top design on the level of laws and regulations cannot be “absent.” The Decision of the CPC Central Committee on Major Issues Pertaining to Comprehensively Promoting the Rule of Law approved at the fourth plenary session of the 18th CPC Central Committee clearly put forward to complete foreign affairs law and regulation systems. As early as ten years ago, relevant ministries and commissions in China were drafting the Investment Immigration Act and Skilled Immigration Act. We can truly achieve the talent management according to the law only by promulgating relevant immigration acts and improving the predictability of foreign talent management to reduce disputes. From the international situation, all

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countries through promulgating immigration law, regulating the foreign talent introduction system, and formulating unified standards, can provide a complete and consolidated basis for talent introduction. China can speed up the study and issuance the Investment Immigration Act and Skilled Immigration Act by comprehensively integrating the laws and regulations such as Procedures for alien entry into and exit from the P.R. China, Rules for the implementation of the regulations for the entry and exit administration of aliens from the P.R. China, Regulations on the Management of Employment of Foreigners in China, and Measures for the Administration of Examination and Approval of Foreigners’ Permanent Residence in China, to make the legal framework of talent introduction and management in China more scientific and systematic, and which could then be realized on a concrete operation level.

6.3.2

To Establish a Unified Regulatory Agency for the Foreign High-Level Talent

Immigration is complicated and foreign talent doesn’t know much about China’s administrative system. In order to provide convenience for them and to improve the work efficiency of relevant domestic departments, we suggest the Chinese government to draw lessons from the developed countries and regions to set up specialized immigration regulatory agencies to unify the management of visa, residence, work and naturalization, the examination and approval the application of visa, Green Card and citizenship as well as processing applications for Green Card, social security, archives and possibly the collective registered permanent residence and other relevant affairs after naturalization.

6.3.3

To Complete and Open the Investment Immigration and Skilled Immigration Category and Lower the Application Threshold

In December 2012, the Administrative Measures for Treatment of Foreigners Permanently Residing in China issued by 25 departments, including the Organization Department of the CPC Central Committee, Ministry of Human Resource and Social Security, Ministry of Public Security, stipulated that foreigners with Chinese Green Card shall enjoy the “national treatment” in principle, which improved the value of the Chinese Green Card. However, China’s Green Card categories and application process still needs to be further completed.

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There are 29 articles in Measures for the Administration of Examination and Approval of Foreigners’ Permanent Residence in China published in 2004, which made specific provisions respectively on issues such as the examination and approval of qualifications, the application materials, examination and approval procedure and authority, and disqualification. In the application conditions, applying for a green card must meet the “one of the seven conditions.” Among the seven conditions, four of them are related to the local citizen’s direct relative immigration; three of them are related to the talent Green Card application. The Talent Green Card can be classified as: Investment Green Card Category, Skilled Green Card Category, and the Interests of the State Green Card Category, which can be specified as follows.

6.3.3.1

The Interests of the State Green Card Category

Having made a great and outstanding contribution to and being specially needed by China.

6.3.3.2

Investment Green Card Category

Having made direct investment in China with stable operation and a good taxpaying record for three successive years. The registered capital paid by him as investment in China shall meet any of the following requirements: (1) In the case of investment in any industry encouraged under the catalogue for Guidance of Foreign Investment Industries, at least USD $500,000 in total; (2) In the case of investment in the western area of China or any key county under poverty reduction and development program, at least USD $500,000 in total; (3) In the case of investment in the central area of China, at least USD $1 million in total; or (4) In the case of investment in China, at least USD $2 million in total.

6.3.3.3

Skilled Green Card Category

Having been holding the post of deputy general manager, deputy factory director, or associate professor (or higher), associate research fellow, and other associate senior titles of professional post, or enjoying an equal treatment, for at least four successive years, with a minimum period of residence in China for three cumulative years within four years and with a good taxpaying record. The applicant shall submit the following materials in addition: (1) A certificate certifying his position or professional title as issued by his employer; (2) The Foreign Expert Card or Foreigner Employment Card; (3) A certificate of registration and certificate of annual inspection of his employer,

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certificate of personal tax payment issued to him. And there are provisions for the employers too.1 To sum up, we suggest the government to reform the current Green Card system and establish four categories talent immigration system including the skilled immigration, investment immigration, self-employed immigration, and national interests and contribution talent immigration. With reference to the internationally accepted standards, to set up the quantitative evaluation quota system and annual demand quota to comprehensively assess the quality of applicants and related conditions. The skilled talent Green Card can be divided into application with job offers and independent application. The application with job offer will use profession rather than position as the application threshold, will implement the internationally accepted integral evaluation system, and will no longer set any limit to the employers. The investment talent Green Card will make a comprehensive evaluation based on the operation ability, background, age, household assets and so on, not only the investment amount. For the global renowned talent such as the Nobel Prize winner, high-level talents in the arts and humanities subjects, business elites, and entrepreneurs, we can implement the independent application or self-employed immigration system, no requirement for working experience in China, residence and finding employers. In addition, we need to consider special situations and allow the Green Card holders to change to other categories. In addition, to further lower the threshold for the overseas Chinese to obtain the Chinese Green Card. First, allow those who are originate from China with a master’s degree or higher to apply for the Green Card. Second, allow all the original Chinese citizens who went abroad from mainland China since the Reform and Opening up apply for the Green Card and enjoy all of the benefits of the Green Card.

6.3.4

To Make the Foreigners Naturalization Policy

There are no related provisions on foreign talent naturalization in China’s relevant legal documents. We suggest that the government increase foreign talent citizenship in relevant Chinese laws such as the Citizenship Act or the Measures for the Administration of Examination and Approval of Foreigners’ Permanent Residence in China and other relevant legal documents. Applicants can apply for citizenship 1

The entity in which he holds a post must be any of the following: (1) An institution subordinate to any department of the State Council or to the people’s government at the provincial level; (2) A key college or university; (3) An enterprise or government-sponsored institution implementing a key engineering project or major scientific research project of the state; or (4) A high-tech enterprise, foreign invested enterprise in encouraged fields, technologically advanced enterprise with foreign investment or export-oriented enterprise with foreign investment. The applicant shall submit a certificate of approval for the foreign-invested enterprise, certificate of registration and a joint annual inspection certificate, report on the verification capital and personal tax payment receipt in addition. In the case of a foreign-invested enterprise in encouraged fields, a letter of confirmation in respect of the foreign-invested project as encouraged by the state shall be submitted in addition.

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after living for 5 accumulative years after getting the Green Card, has no illegal record, and passed the naturalization test. In addition, the naturalized citizens cannot run for public office for a number of years nor can they assume positions with important national symbol significance such as the State President and Prime Minister.

6.3.5

To Establish the Migration Bureau in China

In the process of data collection, especially for Chinese talent and migration policies, it was found that multiple governmental departments are responsible in the process of attracting talents to the country, and settlement. This could mean complication and confusion for talents to apply for Chinese visa or settling in the country. However, investigation to similar situations in EU member countries and other economic developed countries, such as the U.S., this research found that the reason why visa and settlement applications to these countries can be quick, is due to single department is responsible in dealing with such applications and other issues relating to it. For example, the border agency in the U.K. is the only governmental department responsible for enquiries about immigration to the country. This research found that due to all resources required in dealing with issues regarding migration, including human resources, are concentrated to one department, not only shorter time is required in processing these applications and enquires, but also the cost for process such applications can go down significantly. As the world is starting to experience the benefits of an economically growing China, the numbers of international migrants, including students and skilled migrants to China may be on slowly increasing. However, as cooperation between China and the rest of the world increase, increasing numbers of international migrants will be attracted to the country, as multilateral cooperation between China and the rest of the world grows. In order to process such enquiries effectively, this research suggests the establishment of one single governmental department for such issues, similar to that is in traditional migration countries such as the U.S., the U.K., France and more, might be the most effective way ahead for the Chinese government facing the increasing demand of immigration from and to the country.

6.4

To Strengthen the Immigrants Integration Services and Unconventional Immigration Management

Africa as a new untapped market has huge business opportunities. With China’s support for the African governments, a large number of Chinese have migrated to Africa. Since the 21st century, investment immigrants, skilled immigrants, labor immigrants, students, and the number of irregular immigrants have increased

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dramatically. With the increase of the Chinese people in Africa, the African people’s impression of China has changed. A large number of African people are attracted to come to China to develop. Because the climate of Guangzhou and other places is close to Africa, a large number of Africans are gathered in Guangzhou. Some media benignly describe Africans as China’s 57th nationality. At present, there is not an accurate number about how many Africans are in Guangzhou. A deputy mayor of Guangzhou said that by October 25th 2014, there were about 16,000 Africans in Guangzhou, including more than 4000 residents who reside more than six months in Guangzhou, and about 12,000 people who temporarily stay in Guangzhou. Guangzhou Municipal Public Security Bureau exit and Entry Administration detachment director said that in 2013, there were 300,000 African individuals who received accommodation registration in Guangzhou. The executive director of Social Science Research Center in Sun Yat-sen University, Liang Yucheng believes that that 16,000 are those who have legal status, excluding those illegal residence (Mao 2014). From the Comprehensive investigations, there should be hundreds of thousands of Africans living in Guangzhou, in addition to Guangzhou, the Africans in Yiwu are also on the increase. Africans in China are mainly engaged in business, and just like the early Chinese immigrants, they are pursuing a better life. A large number of foreigners, including large number of African irregular immigrants come to China. While playing an active role in promoting the prosperity of the economy, the internationalization of Chinese cities, they also bring challenges to the urban management, social stability and security environment. China should face up to challenges brought by the international immigrants. As Barack Obama said, “to trace, contain and expel millions of irregular immigrants is not realistic,” and “in the era of globalization, the developed countries need to face the fact that they will attract more immigrants from poorer countries to enter in.” Although China is not a developed country, due to its peaceful rise, more and more immigrants in poor countries will enter into China. This requires the deployment of the international migration management and services in advance. First, face the challenges and risks of social management brought by the immigrants and make proper preparations from the ideological concept and system arrangement in time accordingly. Second, for the legitimate, law-abiding expatriates, try to create a good environment, enhance the mutual understanding between the domestic citizens and immigrants to make them to integrate into our society, eliminate the cultural barriers and xenophobia as soon as possible. Third, to draw lessons from the international experience and manage the illegal immigrants in accordance to the law. The governance of illegal foreigners does not conflict with welcoming the international talent. Draw lessons from other countries to deal with the illegal immigrants and treat them accordingly, repatriate the illegal workers with limited work experience in accordance with the law. In addition, improve foreign talent management, reduce the use of “movement” means to hit the illegal immigrants, and strengthen the management of normality.

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The Chinese government has been continuously reforming and refining relevant policies on controlling irregular migration from and to China. It should be recognized that significant results have been achieved on controlling irregular migration from and to China in recent years. However, compared to experienced countries on combating irregular migration, such as the U.K., France Germany and more, there are still lots of experiences the Chinese government can learn from combating irregular immigration. Further, international immigration, regular or irregular migration alike, are issues that have to be dealt with both in destination countries as well as home regions. In order to efficiently controlling irregular migration, as well as promoting regular migration, we suggest it is necessary for China to further cooperate in acting against irregular migration.

6.5

Further Improve the Visa Approval System

In view of the current situation that less foreigners have been entering into China in recent years, there is a need to further improve China’s visa approval system. First, the government should apply the same policies to those countries who have given Chinese citizens facilitation measures such as visa-exemption, visa upon arrival, and extending the visa validity period, to further promote the talent flow and interactions between the two countries. Second, there should be increases China’s 72 h visa-free pilots and prolong the visa-exemption period. Third, the value of Chinese passport needs to be increased and the visa-free application should be expanded from diplomatic, official passports or the passports on business to private passports. Fourth, the visa application procedure for the overseas Chinese needs to be further simplified by cancelling the invitation letters, or adopt facilitation measures like the overseas Chinese certificates. Fifth, the overseas visa intermediary service system should be standardized and its costs decreased.

6.6

Concluding Remarks

With China becoming the most attractive destination of immigrants, the establishment of personnel immigration policy system is composed of visa, Green Card, naturalization and other policies, to open up a new era of immigrants to China. The dividends of international talents to China will become one of the important engines of China’s development in the next 30 years. Attracting talents through the immigration system needs more than an identity and a passport; they should also receive the soft power of the country, an opportunity and dream of the country as well as a country which provides respect, security and welfare to its citizens. It is an important basis to establish an internationally competitive talent immigration system.

References

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References Mao L (2014) Africans in Guangzhou living survey. Chinese Social Sciences Today, 19 Dec Wang HY (2013) A tide of immigration—how can China retain talent? China CITIC Press