A tsunami of private capital has left Russia and Ukraine, the UK has lost its wealth hub crown, and the US is fading fast as a magnet for the world’s wealthy, with the UAE expected to overtake it by attracting the largest net inflows of millionaires globally in 2022, according to the latest Henley Global Citizens Report.
Data from the residence and citizenship by investment advisory firm features the latest projected 2022 net inflows and outflows of US dollar millionaires forecast by New World Wealth.
The HNWI migration figures focus only on people with wealth exceeding $1 million and who have truly moved — namely, those who stay in their new country for more than half of the year.
As expected, Russia has suffered the biggest emigration of millionaires over the past six months, with forecast net outflows of 15,000 HNWIs by the end of 2022 — a massive 15% of its HNWI population and 9,500 more than in 2019, pre-pandemic.
Russia’s invasion is in turn driving a steep spike in outgoing HNWIs from Ukraine, which is predicted to suffer its highest net loss in the country’s history — 2,800 millionaires (42% of its HNWI population) and a net loss of 2,400 more than 2019, the report showed.
Top 10 countries gaining and losing millionaires in 2022
Forecast figures in the Henley Global Citizens Report show the top 10 countries in terms of net inflows of HNWIs in 2022 will be the UAE, Australia, Singapore, Israel, Switzerland, the US, Portugal, Greece, Canada, and New Zealand. Large numbers of millionaires are also expected to move to ‘the three Ms’: Malta, Mauritius, and Monaco.
On the flip side, the 10 countries where the highest net outflows of HNWIs are predicted are Russia, China, India, Hong Kong, Ukraine, Brazil, the UK, Mexico, Saudi Arabia, and Indonesia.
Dr Juerg Steffen, CEO of Henley & Partners, said: “HNWI migration was a rising trend over the past decade until, understandably, it dipped in 2020 and 2021 due to the Covid-19 pandemic. The 2022 forecast reflects an extremely volatile environment worldwide.
By the end of the year, 88,000 millionaires are expected to have relocated to new countries, 22,000 fewer than in 2019 when 110,000 moved.
Projected net outflows of HNWIs 2022
Next year, the largest millionaire migration flows on record are predicted — 125,000 — as affluent investors and their families earnestly prepare for the new post-Covid world, with an as yet-to-be-revealed rearrangement of the global order, and the ever-present threat of climate change as a constant backdrop.”
Andrew Amoils, head of research at New World Wealth says HNWI migration figures are an excellent barometer for the health of an economy.
“Affluent individuals are extremely mobile, and their movements can provide an early warning signal into future country trends. Countries that draw wealthy individuals and families to migrate to their shores tend to be robust, with low crime rates, competitive tax rates, and attractive business opportunities.”
UK and USA – the mighty are falling
According to the latest data, destinations that traditionally attracted wealthy investors are losing their lustre. The UK, once touted as the world’s financial centre, continues to see a steady loss of millionaires, with net outflows of 1,500 predicted for 2022.
This trend began five years ago when the Brexit vote and rising taxes saw more HNWIs leaving the country than entering for the first time. The UK has suffered a total net loss of approximately 12,000 millionaires since 2017.
The appeal of another financial giant, the US, is also dwindling fast. America is notably less popular among migrating millionaires today than pre-Covid, perhaps owing in part to the threat of higher taxes.
The country still attracts more HNWIs than it loses to emigration, with a net inflow of 1,500 projected for 2022, although this is a staggering 86% drop from 2019 levels, which saw a net inflow of 10,800 millionaires.
Net HNWI inflows are on the rise in Israel, with a figure of 2,500 forecast for 2022 — a significant increase of 79% since 2019.
Long-term high performer Australia consistently attracts large numbers of HNWIs. New World Wealth estimates that over 80,000 US dollar millionaires have moved to the country over the past 20 years. In 2022, the net inflow is expected to be 3,500 — the second-highest globally.
Neighbouring New Zealand is expected to receive a net inflow of 800 HNWIs in 2022, and Asia’s prime hub of affluence, Singapore, continues to attract millionaires, with net inflows of 2,800 expected — a prolific 87% increase compared to 2019’s figure of 1,500.
Projected net inflows of HNWIs 2022
Commenting on wealth growth projections in the Henley Global Citizens Report, Prof. Trevor Williams, former chief economist at Lloyds Bank Commercial, said emerging economies are forecast to boom in the next decade.
“As the world economy grows, economies in Africa, Latin America, and elsewhere in the Global South are catching up with high-income economies. And as this report shows, they will see a more significant number of millionaires and billionaires in the next decade.
“For example, the number of HNWIs in Sri Lanka is forecast to increase by 90% by 2031, while India and Mauritius’s millionaire growth is forecast at 80%, and China’s at 50%, compared to 20% in the USA and 10% in France, Germany, Italy, and the UK.”
The data shows approximately 4,500 HNWIs have left South Africa over the past decade.
Most of these individuals have gone to the UK, Australia, and the USA. New World Wealth said that significant numbers have also gone to Portugal, Switzerland, Israel, Mauritius, New Zealand, the UAE, Canada, Monaco and Malta.
According to the report’s authors, Portugal continues to see a steady inflow of high-net-worth individuals, fueled by its top-rated Golden Residence Permit Program, which has attracted large numbers of millionaires from Brazil, China, Russia, South Africa, and Turkey and over the past decade.
The Portugal Golden Residence Permit Program remains the most popular program in 2022, according to Henley & Partners followed by St. Kitts and Nevis Citizenship by Investment Program. Next is Canada, with the Canada Start-Up Visa Program the fastest way for entrepreneurs and wealthy individuals to access Canadian residence and the North American market.
Rising in popularity this year is the Greece Golden Visa Program, and last in the top five is the Antigua and Barbuda Citizenship by Investment Program, said Henley & Partners.
While not in the top 10 in 2022, Malta has been one of Europe’s great success stories of the past decade, not just in terms of millionaire migration but also in terms of overall wealth growth. It is also a destination for South Africans.
Its citizenship by naturalization process has brought substantial new wealth to the island nation and has been credited with propelling Malta’s strong growth in multiple sectors including financial services, IT, and real estate. Approximately 300 millionaires are expected to move to Malta in 2022.
The Indian Ocean island nation Mauritius has attracted a steady number of high-net-worth individuals over the past decade, perhaps due to the ease of conducting business there, said Amoils. Mauritius is also known for its safety, competitive tax rates, and fast-growing financial services sector, he said.
According to the Africa Wealth Report 2022, Mauritius is now home to 4,800 high-net-worth individuals compared to 2,700 a decade ago — 78% growth. Approximately 150 millionaires are expected to move to Mauritius in 2022, mainly from South Africa and Europe.