As published on theguardian.com, Monday 13 June, 2022.
More than 15,000 millionaires are expected to flee Russia this year, as wealthy citizens turn their back on Vladmir Putin’s regime after the invasion of Ukraine, according to an analysis of migration data.
About 15% of Russians with more than $1m (£820,000) in ready assets are expected to have emigrated to other countries by the end of 2022, according to projects based on migration data by Henley & Partners, a London-based firm that acts as matchmaker between the super-rich and countries selling their citizenships.
“Russia [is] haemorrhaging millionaires,” said Andrew Amoils, the head of research at New World Wealth, which compiled the data for Henley. “Affluent individuals have been emigrating from Russia in steadily rising numbers every year over the past decade, an early warning sign of the current problems the country is facing. Historically, major country collapses have usually been preceded by an acceleration in emigration of wealthy people, who are often the first to leave as they have the means to do so.”
Ukraine is projected to suffer the greatest loss of high net worth individuals (HNWIs) as a proportion of its population, with 2,800 millionaires (or 42% of all HNWIs in Ukraine) expected to have left the country by the end of the year.
The world’s wealthy have traditionally relocated to the US and the UK but Henley said the United Arab Emirates is expected to overtake them as the No 1 destination for millionaire emigrants. “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,” Henley said in its report, which is based on “systematically tracking international private wealth migration trends”.
About 4,000 HNWIs are expected to have moved to the UAE by the end of the year, ahead of Australia, which is expected to attract about 3,500, Singapore (2,800) and Israel (2,500).
Large numbers of millionaires are also expected to move to “the three Ms”: Malta, Mauritius and Monaco.
“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,” Amoils said. “It is currently one of the world’s fastest-growing markets, with US dollar wealth growth of 87% between 2011 and 2021. Its citizenship by naturalisation 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 Guardian reported last year that many wealthy people buying “golden passports” to Malta (and thereby the EU) often planned to spend little time in the country. At the time, Henley said it was “proud of the service that it has provided to Malta and its people”.
The Indian Ocean island nation Mauritius is described by Henley as a “wealth magnet” because of the creation of an international financial centre offering significant tax breaks. The country has no capital gains tax, no inheritance tax, and maximum tax rate of 3% of global companies.
According to the Africa Wealth Report 2022, Mauritius is now home to 4,800 HNWIs compared with 2,700 a decade ago. Approximately 150 millionaires are expected to move to Mauritius in 2022, mainly from South Africa and Europe.
Monaco has long attracted the world’s super-rich because it does not charge income tax, capital gains tax or property tax. Just under seven in 10 people living in Monaco are dollar millionaires.
The UK’s HNWI population is expected to decline by 1,500, taking the number of people with more than $1m in ready assets to 738,000. There are currently just over 15 million HNWIs in the world.