In a perhaps unsurprising shift in global wealth migration patterns, Australia is poised to surpass the United Arab Emirates and Singapore as the top destination for high-net-worth individuals (HNWIs). This revelation emerges from a recently published 2023 report by Henley & Partners, a leading authority on investment migration.
While Australia’s ascent to the pinnacle of global wealth migration trends is a significant development, the report also highlights another momentous trend: China is witnessing a substantial outflow of millionaires. This year alone, China is expected to lose a staggering 13,500 HNWIs with investable wealth exceeding $1 million, a phenomenon attributed to both economic factors and changing priorities.
President Xi Jinping’s push for “common prosperity” in China has prompted entrepreneurs to seek more favourable environments for wealth preservation, such as Singapore. Additionally, prolonged COVID-19 restrictions have contributed to the increasing appeal of living abroad for affluent individuals.
Andrew Amoils, the head of research at wealth intelligence firm New World Wealth, notes that China’s general wealth growth has been decelerating in recent years, potentially amplifying the impact of these outflows. Although China experienced robust economic growth from 2000 to 2017, the subsequent stagnation in wealth and millionaire growth underscores the shifting dynamics in the country.
At the same time, the United Kingdom is also expected to experience a doubling of HNWI outflows, ranking as the third-largest loser of millionaires globally. Factors contributing to this exodus include debates over non-domiciled taxpayers and the consequences of Brexit.
It’s important to note that the report exclusively considers HNWIs who have relocated to a new country, spending more than six months a year in their place of residence.
While China’s millionaires continue to seek opportunities abroad, concerns are mounting that these outflows may carry more significant economic ramifications than in previous years. Many Chinese investors have expressed disappointment with the country’s recent financial performance, prompting an increased interest in immigration options.
Visa application processes for wealthy individuals often come with substantial costs, ranging from tens of thousands of US dollars and upwards, depending on various factors. Although Europe has historically been a favoured destination for China’s affluent, some countries, such as Portugal and Ireland, are discontinuing their investment-linked visa programs. Greece has also raised its investment threshold for obtaining a visa through real estate investment.
Additionally, the United States remains an attractive destination for Chinese professionals, particularly in the tech, medical, academic, and research sectors. The US offers various start-up and employment visa programs, including “national interest waivers” (NIWs) within the green card application process, which have gained popularity among Chinese professionals affected by the downturn in China’s tech sector.
While the US continues to attract high-net-worth individuals, the report notes that it has become less popular among migrating millionaires since the onset of the pandemic, possibly due to concerns about higher taxes.
In summary, Australia’s newfound status as the preferred destination for millionaires, coupled with China’s ongoing millionaire outflow, underscores the dynamic nature of global wealth migration patterns, driven by economic, political, and societal factors. These shifts are reshaping the landscape of high-net-worth individuals and their investment choices worldwide.