The European emigration hotspot for rich South Africans

Portugal is seeing an influx of South Africa’s wealthy, joining a growing list of hotspots for the rich.

Portugal Pathways, an organisation that helps support high-net-worth individuals in the country, said that the number of foreign residents registered with the Portuguese government’s Agency for Integration, Migration and Asylum (AIMA) increased by 33.6%, taking the total to 1.04 million.

The company said the growth underlines the nation’s attractiveness to affluent expats and international investors, who see it as the perfect place for funding and businesses.

Data from the Banco de Portugal said that €4.1 billion of direct investment from abroad occurred in the first half of 2024.

“We’ve observed a growing trend of international entrepreneurs, skilled professionals and affluent families moving to Portugal in 2024 and those who plan to in 2025. Many of whom bring substantial wealth,” said Paul Stannard, chairman of Portugal Pathways.

This wave of talent and capital is helping fuel a significant increase in inward investment, especially in sectors like real estate, tourism, renewables, education, healthcare and tech.

The population growth comes mainly from Portuguese-speaking Brazilians, who comprise 35.3% of the foreign population. The changes to the Brazilian government has led to an exodus of the wealthy seeking to move to Europe.

Similar concerns motivate entrepreneurs and affluent families in the US, UK, Singapore, Canada, and, most importantly, South Africa.

The NHR—or Non-Habitual Residency—tax regime also played a crucial role in attracting new wealth investment and creating jobs through various tax breaks.

NHR 2.0, or, more formally, the Tax Incentive for Scientific Research and Innovation Program, will launch in 2025, encouraging experts in the listed fields to move in.

“We’re witnessing a significant amount of inward investment into Portugal. It’s coming from private wealth as well as institutional investment from the likes of the EU’s European Investment Fund,” said Chris Marson from Beacon Global Wealth Management.

“We’re also seeing family offices moving into asset classes such as Portugal-focused alternative investment funds in sectors such as biotechnology, solar energy, tourism and technology.

“Serious investment is also being directed into major infrastructure and development projects, which have become key areas for sophisticated foreign investors.

Closer to home

Portugal is not the only wealthy nation that wealthy South Africans are turning to, with Mauritius and Namibia set to see an influx of wealth over the next decade.

The 2024 Africa Wealth Report by Henley & Partners and New World Wealth said that Africa’s millionaire population will surge 65% over the next ten years.

Mauritius and Namibia’s millionaire populations are set to increase by 95% and 85% over the next decade, respectively.

Both countries offer investment migration pathways for the super-rich, especially those who use property as an investment opportunity.

Lance Lawson, Business Development Consultant at Sovereign Group, said that the two African countries are emerging as wealth hubs due to their strategic policies favouring foreign investment.

The luxury real estate sector is a popular investment choice in these destinations, as assets offer potential income, capital appreciation, and flexibility for families with members in different locations.

Although neither country imposes a capital gains tax, Namibia does not have an estate duty, while Mauritius recognises trust law and allows estates to be structured accordingly.

Read: Standard Bank bets big on Africa’s new millionaire hotspot