Australia is the world’s top destination for millionaire migrants
26 Feb 2017
With all the debate over immigration in the United States and Europe, one group of immigrants is getting a red-carpet welcome around the world: millionaires.
Last year, a record 82,000 millionaires moved to another country, according to a new study.
While their numbers are a small fraction of the world’s migratory population, and of the world’s millionaires, wealthy people are being courted and cosseted by host countries like never before.
The growing contrast between migrants who are poor and those who are wealthy reveals a less-noticed form of global inequality, as well as an acceleration of a new culture of the rootless, borderless rich.
“The wealthy today don’t have a country,” said Reaz H Jafri, a New York-based partner at Withers Worldwide, a law firm that helps wealthy clients move and relocate around the world.
“They don’t view their success as being related or dependent on a single country, but on their own business strategies. It’s amazing to me how many of the very wealthy are going totally mobile.”
The rich have always been a restless class, of course, moving with the seasons or the social circuit.
But the current wave of millionaire migrations seems to have reached a new level, with wealthy families changing citizenship, sending their children overseas or moving permanently to the nation of their choice.
Rather than fleeing economic ruin or conflict, millionaire migrants are shopping the world for the best schools, financial safety and lifestyle.
Technology, coupled with the rise of global markets and global investors, has given rise to multinational millionaires who increasingly have no nation.
According to New World Wealth, a market research firm based in Johannesburg, South Africa, the number of millionaires moving to another country jumped 28 per cent in 2016 from the previous year, reaching the highest level the firm has found in its four years of measuring.
Millionaire migration has grown 60 per cent since 2013, the firm’s findings show, and there are no signs that it is slowing.
Andrew Amoils, head of research at New World Wealth, said he expected the ranks of millionaires on the move to top 100,000 within the next two to three years.
That’s still a small slice of the estimated 13.6 million millionaires around the world, defined as those having at least $1 million in assets (minus liabilities), not including their primary residence.
New World Wealth’s data includes only millionaires who have physically moved to a country for a period of at least six months. It uses surveys, real-estate data and research with relocation firms and other specialists for its estimates.
Add to those numbers the wealthy who have changed or added citizenships, those who spend part of their time in various countries or own homes in multiple nations, and the numbers grow much larger.
“We looked at the people who truly moved,” Amoils said. “But the universe of multinational wealth is obviously much larger.”
Australia is No.1
The map of migration is also changing rapidly. Australia is the world’s top destination for millionaires, beating the United States for the second straight year, according to New World Wealth.
An estimated 11,000 millionaires moved to Australia in 2016, compared with the 10,000 who moved to the United States.
Canada ranked third, with 8,000, followed by the United Arab Emirates and New Zealand.
As for countries that millionaires are fleeing, France tops the list, with 12,000 moving out during 2016.
Australia, like many countries, has also created money-for-visa programs to make it easier for rich immigrants to move in and become citizens.
In 2012, the country introduced a “golden-ticket” investor visa program that fast tracks and eases the residency requirement for a permanent visa.
Millionaires need to invest $5 million Australian dollars to qualify for the program, officially called the Special Investor Visa.
Since its creation, more than 1,300 foreigners, nearly 90 percent of them from China, have used the program, according to government statistics.
The government also has an investor visa program that allows people to invest $1million Australian dollars. That option comes with more restrictions, and it takes longer to get a permanent visa.
The other two top destinations, Canada and the United States, also have generous visa programs for the wealthy. America’s EB-5 program requires a $500,000 investment, although there are proposals in Congress to raise that figure, which hasn’t changed in 27 years, to over $1 million.
Canada scrapped one of its main investor-visa programs in 2014, but other programs are available for wealthy foreigners. The number of 10-year visas issued to Chinese citizens more than quadrupled between 2012 and 2015, to 337,000.
Amoils said the main reason millionaires are leaving China is to educate their children in Western or Australian schools that will give them a better education and connections for their careers.
Of course, living in a country where billionaires literally disappear amid the government’s crackdown on corruption also drives the rich and their fortunes overseas.
A 2014 report from Hurun, a research firm in Shanghai that tracks the wealthy, found that 64 percent of Chinese millionaires were considering or were in the process of moving, with education topping the list of reasons.
Jafri of Withers Worldwide said that personal safety goes hand in hand with education for many of the world’s millionaires when considering a move.
Many of his clients are Latin Americans seeking a haven from kidnapping and crime.
“My clients say, ‘In New York, I can walk my daughter to Brearley, while in Buenos Aires we have to get into an armoured car,'” Jafri said.
The flight of French wealth is driven by different worries. Amoils said millionaires leaving France cite religious tension and personal safety as their main reasons. While France’s high taxes on wealth are a factor, he and others said that social and political forces are more important.
“For them, it’s often about the changing culture of France,” Amoils said.
For decades, the rich sought tax havens like Monaco, Switzerland or the Caymans to maximize their wealth. Now they seek stable countries with financial systems that can protect their fortunes, even if income taxes are high.
And while President Donald Trump’s immigration policies have had little impact on wealthy immigrants thus far, Jafri worries that they could shut out future entrepreneurs and talent.
“We are letting in today’s millionaires,” Jafri said. “But what about tomorrow’s?”