The United Kingdom is projected to experience a net outflow of 3,200 high-net-worth individuals (HNWIs) in 2023, surpassing Russia’s expected net loss of 3,000, according to the Henley Private Wealth Migration Report 2023. This makes the UK the third-largest loser of millionaires globally, following China with a net loss of 13,500 and India with a net loss of 6,500. Notably, the UK’s anticipated HNWI flight is double that of last year, when it saw a net exodus of 1,600 millionaires.
The report, released by Henley & Partners, a leading international residence and citizenship advisory firm, exclusively features the latest net inflows and outflows of dollar millionaires. These figures focus only on HNWIs who have truly moved, meaning those who stay in their new country more than six months a year.
Australia and UAE Attract the Wealthy
Australia is expected to attract the highest net inflow of HNWIs in 2023 at 5,200. The United Arab Emirates, despite dropping to second place after its record-breaking influx in 2022, is still expected to enjoy an impressive net arrival of 4,500 new millionaires this year. Singapore ranks third with a net inflow of 3,200 HNWIs, its highest on record, followed by the US with an expected net influx of 2,100 millionaires.
Brexit and Policy Changes Impact UK’s Appeal
The UK’s peak net outflow year was 2017, following the Brexit referendum in 2016. Prior to this, the country enjoyed net positive inflows of HNWIs. While net losses dropped slightly between 2017 and 2019, the 2023 forecast indicates a far more significant millionaire exit is currently underway. The data suggests that Brexit, coupled with the policy change to remove permanent non-domiciled taxpayer status, has made the UK less hospitable and welcoming to HNWIs.
US Losing Its Lustre Among Migrating Millionaires
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 2,100 projected for 2023, although this is a staggering drop from 2019 levels, which saw a net inflow of 10,800 millionaires.
China and India Continue to Lose Millionaires
As it has for the past decade, China continues to lose the largest numbers of dollar millionaires each year to migration. India, although the second-biggest loser globally, produces far more new millionaires than it loses to migration, making its net exit numbers less concerning.
Political Stability and Low Taxation Regimes Attract HNWIs
Political stability, low taxation regimes, and personal freedom are key metrics for those selecting where they want to live. Until the Russo–Ukrainian war comes to an end, both countries will continue to export HNWIs, and this will remain the single largest driver of relocation.
Investment Migration Program Enquiries on the Rise
Henley & Partners received the highest number of investment migration program enquiries on record in the first quarter of 2023 — an increase of 36% compared tothe previous quarter, and a remarkable 47% higher than the same period in 2022. The top two nationalities currently driving demand are Indians and Americans, with Brits and South Africans remaining in the Top 10 as they have done for the last five years.
The Impact of HNWI Migration on Destination Countries
Dr. Areef Suleman, Director of Economic Research and Statistics at the Islamic Development Bank (IsDB) Institute, notes in the report that the impact of HNWI migration on destination countries is likely to be beyond the investment itself because of a multiplier effect. If the USD 1 million coming from HNWIs are invested in a business, it could generate employment and additional demand from existing domestic producers, which multiplies its impact to an amount greater than the initial investment.
Popular Investment Migration Pathways
Portugal’s Golden Residence Permit Program remains the most popular overall in 2023, followed by Austria’s citizenship by investment offering and St. Kitts and Nevis’s Citizenship by Investment Program. Next is Canada’s 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 and last in the top five is Italy’s Residence by Investment Program, with Greece’s Golden Visa Program and Spain’s Residence by Investment Program hot on the heels of their Mediterranean counterpart.
The Shift in Wealth Migration Trends
Dominic Volek, Group Head of Private Clients at Henley & Partners, says historically, many wealthy individuals acquired residence rights or citizenship without moving to those countries. However, recent and persistent turmoil has caused a shift — more investors are considering relocating their families for a range of reasons, from safety and security, to education and healthcare, to climate change resilience and even crypto-friendliness.
The Future of Wealth Migration
Jeff D. Opdyke, a leading personal finance columnist, author, and investment expert, points out in the report that wealth migration has always been about chasing greater opportunity while also taking wealth out of harm’s way. That will never change. But what will change — what’s already changing — is the landscape that defines where wealth will likely migrate to tomorrow. Wealth insists on mobility as an option — an escape hatch allowing HNWIs to decamp from a decaying situation and root once more in economies more welcoming to their wealth or their business objectives.
The Henley Private Wealth Migration Report 2023 provides a comprehensive overview of the global wealth migration trends. It highlights the changing landscape of wealth migration and the factors influencing the decisions of HNWIs. As the world continues to grapple with economic and political uncertainties, it is clear that the ability to move and secure wealth across borders remains a top priority for the world’s wealthy.