Weak rand hits as South Africa’s rich leave the country

New World Wealth has published its South African wealth report for 2019, showing the patterns of the country’s wealthiest people.

The report found that the country is currently home to 39,200 High Net Worth Individuals (HNWIs) – defined as individuals who have net assets of $1 million or more.

This is a drop of more than 3,000 compared to last year (43,600), as total wealth declined across the country.

“2018 was a poor year for South Africa – total private wealth held by people living in the country declined by 10% from US$722 billion in 2017 to US$649 billion in 2018.,” New World Wealth said.

“This drop was facilitated by a weakening local currency – the US$ exchange rate went to R12.30/US$ at the end of 2017 to R14.40/US$ at the end of 2018.

“The JSE all share index was also down significantly during the year (by 29% in US$ terms).”

Migration

The report also shows that a large number of wealthy South Africans are leaving the country.

“Based on our estimates, around 3,000 HNWIs have left South Africa over the past 10 years. Most of these individuals have gone to the UK, Australia and USA. Switzerland and Portugal are also destinations,” it said.

This aligns with a report released by PPS in April which found that top professionals have joined the rush to leave South Africa.

“According to our survey’s results, South Africa’s skilled professionals – doctors, accountants, lawyers, engineers, corporate employees, and successful entrepreneurs – are giving more consideration towards emigrating due to their being qualified to do so and having the financial means,” said Motshabi Nomvete, head of technical marketing at PPS.

“This holds many implications of a professional migration trend on a developing nation.”

Read: South Africa has lost a shocking number of millionaires – here’s how many are left