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Tourism, Study, and Trade Are Cautiously Welcomed Back

ANNIE PFORZHEIMER

ANNIE PFORZHEIMER

Annie Pforzheimer is a retired career diplomat with the personal rank of Minister Counselor from the Department of State, a Senior Non-Resident Associate at the Center for Strategic and International Studies, a member of the Council on Foreign Relations, a Global Fellow at the Woodrow Wilson Center, an Adjunct Professor at the City University of New York, and a public commentator and consultant on foreign policy issues.

Just when it seemed safe to buy a plane ticket — or press forward with student and investment planning — uncertainty in the travel sector and continued Covid-related constraints to visa processing blocked nascent US and Canadian recoveries. Political gridlock in Washington has kept the US EB-5 Immigrant Investor Regional Center Program visa on ice, and US embassies are not yet up to processing speed. However, not all news is bad — Canada’s re-elected Liberal government unabashedly embraces migration to solve its labor shortages.

Travel and tourism still below normal — and Omicron isn’t helping

Foreign travelers may yet fulfill their wish to visit the USA, and with the vaccinated population growing in 2021 Americans are planning to take long-delayed vacations overseas, but the uncertainty of new variants and travel bans — with the specter of the costs of canceled travel — may still depress demand. With the arrival of the Omicron variant late last year, the USA placed eight southern African nations under a travel ban and instituted a requirement for a negative Covid test within one day of travel for all air arrivals, including US citizens and residents. Canada followed suit but both countries have now lifted these restrictions and enhanced testing rules.  

GMR - Pforzheimer

Prior to this, the Centers for Disease Control and Prevention’s (CDC’s) updated rules from 8 November had signaled a more welcoming US government approach to international travelers, especially those inoculated with an ‘accepted’ Covid vaccine; for those without one, exemptions and specific testing rules exist. Land travel between the USA and Canada and Mexico opened fully at the same time, but on 11 January 2022 the CDC advised Americans against travel to its northern neighbor due to rising Covid infections. Since 30 November 2021, Canadian travelers into the USA for less than 72 hours have been permitted to return home without having to take another test. Businesses on both sides of the border have been badly hit and hope to recover with the new openings.

In general, overseas travel by Americans in 2021 showed a 30% improvement from 2020 but remained far below 2019 levels, as were international arrivals. An important contributor to depressing international travel is the Chinese government restrictions on its citizens’ travel, previously a lucrative market for the US tourism industry. Despite concerns and setbacks, there were improvements in tourist and student visa processing times. US visa administration remains slow, however, due to rules requiring in-person procedures with embassies only partially staffed or open to the public.

When travel does normalize, the USA and Canada will find themselves in friendly competition for foreign students. Canada is a clear favorite in a recent poll, mostly due to its more liberal policies allowing students to work. Meanwhile, the State Department’s Open Doors report published on 15 November 2021 shows that the precipitous 2020 decline in international student enrollments stabilized in 2021, but due in part to continued Covid uncertainty and economic pressures at home, many international students have yet to return to the USA.

US investor rules stagnate

With the passage of a Continuing Resolution on 3 December 2021 rather than a new spending bill, the US Congress failed to end a state of uncertainty for EB-5 investors on issues such as: whether or not regional centers will be revived, what the minimum required investment will be, and whether investors will be paroled into the USA as they await EB-5 approval. The U.S. Citizenship and Immigration Services announced on 30 December 2021 that it is “re-evaluating the decision to hold, or not act on, any pending petition or application of these form types that is dependent on the expired statutory authority and was filed before the end of the statutory authorization.” A similar program in Canada’s Quebec province restarted in November, however, and reportedly, planning for a range of investor visas — including one for start-ups — is set to move into high gear for the world after Covid.

Migration to North America – a Canadian welcome mat

The newly-re-elected Canadian government has made public its intention to welcome more immigrants, helping ease labor shortages there. Prime Minister Justin Trudeau’s immigration minister has signaled that he could raise the labor cap, already generous, if more workers are needed. Last year, as Covid choked some of the routes for new influxes of workers and led to a nearly two million-long list of immigration applications, Canada compensated by offering more temporary workers in-country a path to permanent residence.

North America continues to be a strong attractor of migrants, especially those who are driven by climate change factors such as droughts and hurricanes in Central America. In October 2021 the Biden Administration released a first-ever US Government report linking climate change to migration worldwide. Within the USA, in 2020 over 1.7 million people were registered as internally displaced due to disasters such as wildfires. Meanwhile, a surge of refugee arrivals from Afghanistan to the USA followed the withdrawal of American forces and collapse of the Afghan government in August 2021, along with an extended drought. It was estimated that 100,000 would have arrived by the end of 2021.

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