China is expected to become the country with the highest outflow of millionaires for the third consecutive year. On Tuesday, a latest report revealed that in the past two years, China topped the world in terms of outflow of high net worth individuals. It is projected that in 2024, the number of wealthy Chinese leaving the country will reach a record-breaking 15,200, once again leading the pack and bringing further impact to the Chinese economy.
On Tuesday, international investment immigration consulting firm Henley & Partners released the “2024 Henley Private Wealth Immigration Report”, specifically detailing the latest net inflow and outflow of millionaires (the difference between the number of affluent individuals with liquid investable wealth of $1 million or more who move into a country and the number of wealthy individuals leaving the country). This report was co-authored by wealth intelligence company New World Wealth in collaboration with Henley & Partners.
It is forecasted that 15,200 wealthy individuals will leave China this year (compared to 13,800 in 2023); the main reasons for Chinese wealthy individuals choosing to leave are economic uncertainty in China, geopolitical tensions, and the allure of opportunities overseas, prompting many to seek new avenues for development.
The report states that this number represents a new record for wealth outflow from China. Henley & Partners mentioned that it is difficult to determine how much wealth migrants take with them, but according to Andrew Amoils, research director at New World Wealth, “based on our experience, those who move the most are usually those with wealth ranging from $30 million to $1 billion.”
In recent years, overall wealth growth in China has been slowing down, indicating that wealth outflow from the country may have a more disruptive impact. China’s economy has been growing slowly since 2017, leading to sluggish growth in wealth and millionaires.
The ongoing real estate crisis in China, significant shrinkage of middle-class wealth, and mounting local government debts have added to the uncertainty. The International Monetary Fund earlier this year stated that due to the real estate crisis, China is facing “high uncertainty.” In April, Fitch Ratings downgraded China’s sovereign credit outlook to negative, following a similar action by Moody’s in December last year.
The trend of Chinese wealthy individuals immigrating overseas has been ongoing for many years, but dissatisfaction with Beijing’s authoritarian political system has intensified during the zero-COVID period. Following the relaxation of COVID control measures, more and more Chinese millionaires are accelerating their immigration overseas.
Traditionally popular destinations for wealthy individuals leaving China include Singapore, the United States, and Canada, with Japan emerging as a notable new destination.
The report does not provide exact numbers of Chinese millionaires immigrating to the U.S., nor does it specify the reasons for Chinese immigration to the U.S.
In recent years, the Chinese community in Canada has significantly expanded, especially in British Columbia. Vancouver has become one of the most desirable destinations in North America, with a population growth of over 250,000 in the past decade, visible emergence of new businesses, and soaring housing costs.
Real estate agents in Japan and other observers concerned about population outflow also noted that the slowdown in the Chinese economy and the lackluster stock market have contributed to wealthy individuals leaving China. As of the end of last year, Japan had approximately 822,000 Chinese residents, an increase of 60,000 from the previous year, marking the largest increase in recent years.
“Japan’s way of life is very attractive, with beautiful public gardens and golf courses, and according to the Global Peace Index, Japan is listed as one of the safest countries in the world,” Amoils said.
On a global scale, Dominic Volek, head of the Henley & Partners Private Client Group, stated in a press release that 2024 will be a watershed year for global wealth migration. “This year, it is expected globally that 128,000 millionaires will emigrate, a figure unprecedented in history, surpassing the record of 120,000 set in 2023.”
“With the world grappling with the perfect storm of geopolitical tensions, economic uncertainty, and social unrest, millionaires are voting with their feet in record numbers. In many ways, this wave of millionaire emigration serves as a leading indicator, signaling profound shifts in the global landscape of wealth and power, with far-reaching implications for the future development trajectories of the countries they leave or the countries where they settle anew,” he said.
The UK lost 9,500 millionaires, second only to China; India lost 4,300 millionaires, ranking third. The countries and regions ranked fourth to tenth are South Korea (1,200), the Russian Federation (1,000), Brazil (800), South Africa (600), Taiwan (400), Nigeria (300), and Vietnam (300).
In the ranking of countries where millionaires are moving to, the UAE tops the list, with the U.S. coming in second.
Amoils stated that the benefits of wealth and talent migrating to these destination countries are significant and wide-ranging. “Immigrating millionaires are a significant source of foreign exchange, as they often bring money with them when moving to a country. Additionally, approximately 20% of them are entrepreneurs and company founders who may start new businesses in the new country, thereby creating job opportunities locally, and for multi-millionaires and billionaires, this ratio jumps to over 60%.”