Wealth In Flight

"It can be a sign of bad things to come as high-net-worth individuals are often the first people to leave -- they have the means to leave unlike middle-class citizens."
"Once the standard of living in these countries improves, we expect several wealthy people to move back [to their countries of origin]."
Andrew Amoils, head of research, New World Wealth

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Although according to New World Wealth even as high-net-worth people from China and India flee with their wealth to more financially stable countries to shelter their assets, the process whereby new millionaires are created continues, and as those new millionaires reach their coveted status they make up for the vacuum left by their predecessor who have flown. And whom analysts believe will return once stability and the climate for wealth to continue accumulating without undue risks returns.

In China, the state's grip on capital outflows in recent years has resulted in many of its wealthier citizens -- nervous about increased taxes -- shifting assets and people. Wealthy Asians tend to consider living in more comfortable environments where they look for greater privacy -- and where their children's education potentials can be enhanced -- when they consider where to re-locate themselves and their wealth.

An estimated 108,000 millionaires migrated last year, leaving their countries of origin for more promising fields abroad where concern arises over their wealth dwindling for any number of reasons related to higher taxation and growing social instability, representing an increase in such moves of 14 percent from the previous year. The numbers are over double the level in 2013, according to Johannesburg-based New World Wealth.

The top receiving destinations have been identified as Australia, Canada and the United States, cites the research firm, with China and Russia leaking their wealthy more than other countries. Even the United Kingdom saw a reduction of roughly three thousand millionaires who left for greener fields anticipating the impact that Brexit and taxation may eventually have on their wealth.

Social conditions such as crime, a paucity of business opportunities and religious tensions all have a part to play, and can be viewed as well as a future indicator, propelling the wealthy away from their current circumstances and into a more business-conducive atmosphere prevailing elsewhere. Australia appears to be top of the "wish list" for immigrants citing its safety, lack of inheritance tax and robust ties for business with China, Japan and South Korea.

Australia's sustained economic growth is yet another factor in its popular favour given that the global financial crisis left the country fairly unscathed, a country that has managed to avoid recessions in the past 27 years. The second most popular destination in 2018 was the United States. New York City, Los Angeles, Miami and the San Francisco Bay area are identified as the preferred destinations.

The volatility of emerging markets -- and downturns in others also fuels movements. Turkey lost four thousand millionaires in 2018, representing the third year in a row that many people of wealth have chosen to leave the country, while Russia last year lost about 7,000 millionaires as the nation grappled under sanctions imposed over Crimea's annexation.

After interviewing 100 millionaires, some patterns started to emerge.

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