State Hopes to Attract Foreign Entrepreneurs

Lt. Gov. Leo T. McCarthy launched a campaign Wednesday designed to attract wealthy foreign entrepreneurs to California, potential investors who can settle in the United States under new federal immigration provisions.

Under the provisions, contained in an immigration reform package signed into law Nov. 30, the federal government will set aside 7,000 visas for those who invest at least $1 million in a new enterprise that creates a minimum of 10 jobs. Another 3,000 work visas would be reserved for foreign nationals willing to invest a minimum of $500,000 in rural regions or areas of high unemployment.

Some immigrants rights groups and members of Congress have criticized the change, contending that the provision allows wealthy foreigners to buy their way into the United States. However, supporters of the measure argue that the provision will bring needed economic development.

Speaking at a news conference in Universal City, McCarthy said he would use his position as chairman of the California Commission for Economic Development to help develop a strategy for attracting foreign investors.

“In California we have 6.7% unemployment and--like the nation--we are feeling the recession,” McCarthy said. “What we hope to do here . . . is to try to tap into the opportunities in the Immigration Act of 1990 to give the California economy a needed shot in the arm.”

The Immigration and Naturalization Service will make the visas available beginning Oct. 1, 1991. The INS now sets aside 20,000 visas per country annually. Priority is given to applicants with family already in the United States and to the highly skilled.

The INS sets aside only 5,000 visas per colony annually. Hong Kong residents have been fleeing to the West because they fear political uncertainty associated with Britain’s plans to hand over the colony to China in 1997. McCarthy said the new provision should appeal to entrepreneurs from Hong Kong and other parts of the Pacific Rim.

McCarthy said he would solicit the support of the state’s business community--particularly business leaders with an immigrant past. The business community could help identify potential immigrants who meet the investment criteria, he said. In addition, he said he would urge the state economic commission to bring those in need of venture capital and would-be investors together.

The Pacific Leader Council, a Los Angeles-based national organization active in issues concerning Asian-Americans, supports the provision and McCarthy’s plans.

Council Co-Chairman Fred Hong said the U.S. provision is tougher than a Canadian measure, which offers permanent residency to anyone who places a minimum of $250,000 into a government-sanctioned venture capital fund. The law has attracted 2,200 Hong Kong investors since 1986. Australia and New Zealand have similar provisions.

John Gamboa, executive director of the Latino Issues Forum, a San Francisco-based civil rights group, said, however, that the INS should provide more visas instead of giving investors a priority position. “This says, ‘We welcome you if you’re rich; but if you’re poor--stay out,’ ” Gamboa said.