New data shows that rich South Africans are leaving the country

Independent international financial consultancy, deVere Group, reports a 45% year-on-year jump in enquiries from high-net-worth individuals seeking citizenship and/or residency outside their country of origin.

The most commonly quoted figure for membership in the high net worth club is $1 million in liquid financial assets.

Nigel Green, the founder and CEO of deVere Group, said: “Wealthy individuals around the world are now increasingly considering investing in a second citizenship or overseas residency.

“It’s our experience that the majority of high-net-worth individuals and their families wishing to obtain dual citizenship or residency are coming from India, China, South Africa, the Middle East and Russia.”

Typically, they are considering opportunities for citizenship or residency in Europe or the Caribbean, Green said.

“There are many different reasons why clients are eyeing alternative citizenships and residencies for themselves and their families.  These include significantly greater scope for visa-free global travel, political stability, world-class education and healthcare, tax efficiency, and wider business growth opportunities,” he said.

Each host nation country will have different criteria that need to be met, such as how many days need to be spent in the host country.  Some requirements are common to all such programs including having a clean criminal record and being able to prove the legal source of funds.

There is a clear distinction between citizenship and residency, with both offering different benefits to the applicant. The main difference is that citizenship, which gives you a passport, is forever unless it was granted under fraudulent means.

“Most clients will opt for residency in the first instance as it is typically less costly and an easier process to complete – and is a recognised gateway to full citizenship. Plus, some countries like China and India do not recognise dual citizenship, so residency is the only option,” said James Minns, head of global development at deVere.

“The investment-for-residency schemes are typically based on real estate investments and start from around 250,000 euros in Greece.”

He said that Portugal’s programme is proving to be the best option for many clients as it requires only two weeks a year residency obligation. “It gives full residency benefits to live, work, open a business and study there with complete access to travel across Europe’s Schengen area. Plus, there is the option of obtaining full citizenship after six years if required.

“This option is a straight real estate purchase of 500,000 euros into a new build property. There are lower property options available, however, they are only for properties over 30 years old and most investors prefer the newer real estate as they typically provide better investment opportunities and are less hassle to maintain.”

And local data suggests, it is not only wealthy individuals leaving South Africa. For every professional immigrating to South Africa – eight professionals are emigrating.

Skilled South Africans continue to emigrate in droves as they seek opportunities abroad,  leaving behind a country mired in unemployment, endless political wrangling, and corruption that has hampered economic growth.

City Press reported that the trend is expected to continue as skilled workers target job security, citing figures from removals companies.

Removals firm, Elliott Mobility, said it facilitated 2,500 moves abroad in 2018, “and we are expecting an approximately 20% increase,” the company’s Moira Luyckx told the paper.

Luyckx pointed to New Zealand, Canada, Australia, the UK, the US, France, Germany, Mauritius and Panama, as the most popular destinations.

“People are emigrating for job and family prospects. There are also some who are relocated by local and global corporations for their specific skills,” she said.

According to Elliott, clients are aged between 30 and 55, and are 85% white, 5% African and 10% Indian.

Similarly, Stuttaford Van Lines pointed to a 15% increase in families emigrating in 2018, many of whom are skilled workers who transferred abroad within multinational companies.

Read: Skilled South Africans are moving to these 9 countries

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New data shows that rich South Africans are leaving the country