The two countries catching the eye of millionaires from South Africa
The incredibly wealthy are turning their attention to Nambia and Mauritius as investment destinations.
Africa is experiencing a wealth boom, and with roughly $2.5 trillion in investible wealth, the continent is expected to be on the brink of economic transformation.
The 2024 Africa Wealth Report by Henley & Partners and New World Wealth shows 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 also offer investment migration pathways for the incredibly wealthy, particularly those who want to use property as an investment opportunity.
Lance Lawson, Business Development Consultant at Sovereign Group, said that Namibia and Mauritius are emerging as wealth hubs due, in part, to their strategic policies that favour foreign investment.
The luxury real estate sector is a popular investment choice in these destinations, as they offer potential income, capital appreciation, and flexibility for families with members in different locations.
Neither country imposes a capital gains tax. Although Namibia has no estate duty, Mauritius recognises trust law and allows estates to be structured accordingly.
“Their political and economic stability, coupled with their relative affordability and proximity, makes these countries highly attractive to South African HNWIs looking to invest in sub-Saharan Africa,” said Lawson.
The Africa Wealth Report showed that South Africa lost over 11,000 dollar millionaires in the past decade, which is 20% of its millionaire population.
The group’s Wealth Migration Report 2024 also showed that South Africa remains one of the significant millionaire outflow countries, with an estimated 600 high-net-worth individuals (HWNIs) expected to depart the country in 2024.
HWNIs have a liquid investable wealth of $1 million (~R18 million) or more.
Lawson said that spreading wealth across jurisdictions helps manage risk, access a wider array of investments, and minimise the risk of localised political or economic instability.
Mauritius
Mauritius has long been considered one of Africa’s most business-friendly countries due to its economic growth and favourable policies.
Moreover, it is only one of two African countries, with the Seychelles, that allows its citizens to access over 50% of global GDP without a visa.
Mauritius also has numerous residency by-investment opportunities.
For instance, one can purchase a residency with a minimum capital investment of $375,000, which provides the right to live, work, and retire on the island.
Buying property in Mauritius, mainly through a government-approved scheme, such as a Property Development, Integrated Resort of Real Estate Scheme, also allows one to enjoy tax gains, which can be facilitated through companies, trusts, and foundations.
Namibia
Namibia’s trust law also offers opportunities for holding assets while providing tax advantages.
The only caveat is that an investment property cannot be used as agricultural land.
The Namibian Income Tax Act also favours trusts. The absence of donations, capital gains and estate taxes makes it an excellent location for international structures.
Foreign investors are protected under the Namibian Foreign Investment Act, ensuring equal treatment for foreign and local investors.
Foreign investors with a ‘Certificate of Status Investment’ can repatriate their capital and benefit from a simplified process of obtaining an employment permit.
Moreover, Namibia also has formalised export processing zones. These zones can offer competitive pricing advantages to export-led manufacturers, as they are exempt from corporate income tax, duties, and VAT on machinery, equipment, and raw materials imported into Namibia for manufacturing purposes.
Residence by investment in Namibia also requires a minimum capital investment of $365,000 and allows investors the opportunity to live, work, and study there without restriction.
Read: South Africa’s millionaire life insurance bosses – earning up to R32 million
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