Can you tell us a bit about your background, and how you got into your current role?

My background is in private banking, with more than 25 years’ experience in this area. I hold a PhD degree in Law and have served as a director of leading private banks in Switzerland and Austria. After joining Henley & Partners, I built up the South East Asia region and worked as Group Chief Operating Officer for a number of years. Now I am delighted to step into my new role as the firm’s CEO.

 

What exactly are the services that Henley & Partners offers, for those that don’t know about the company?

We broadly offer two services.

  1. We are the industry leader in residence and citizenship planning, providing our clients with an A–Z service that includes real estate acquisition and property management. 
  2. Alongside our private client business, we are also the preeminent advisor to sovereign states as regards the design and operational development of investment migration programs. Our government advisory practice has raised more than USD 8 billion in foreign direct investment for countries around the world.

Because we have been involved in the design, set-up, and operation of the world’s most successful residence and citizenship programs, we understand the application processes for different programs on a very deep level — including the stringent due diligence procedures. For all these reasons, we are extremely well positioned to serve those interested in residence- and citizenship-by-investment, and to advise any sovereign state considering adding an investment migration option to its foreign direct investment strategy.

 

What do you think has led to the increase in high-net-worth individuals (HNWIs) in recent years?

There are an estimated 18.2 million high-net-worth individuals on the planet, and their collective wealth now sits at over USD 70 trillion. These remarkable numbers are expected to grow continually over the coming years. There are a number of potential reasons for this increase, including the fact that HNWIs are now found all over the world, whereas previously, wealth was concentrated in western markets and in countries of so-called ‘old money’. The rise of emerging markets in the Far East and Middle East, as well as in South America, has created a new class of HNWIs and led to a global increase in wealth.

 

How and why does this affect wealth migration?

The majority of millionaires relocate via dual citizenship, work transfers, spousal and family visas, as they have always done. However, the emergence of residence- and citizenship-by-investment programs over the past decade is having a growing impact on global wealth migration trends. Investment migration differs from other forms of migration in that individuals are required to make a significant economic contribution to the host country before they are admitted, as a sort of upfront demonstration of their commitment to the country’s prosperity and wellbeing. In exchange for this extraordinary contribution, individuals obtain either residence or citizenship rights in that country, as the case may be.

Because these programs represent such a clear ‘win–win’ both for the countries administering them and for the individuals participating in them, their popularity is growing dramatically, and we expect this to continue.

 

What are the effects of investment migration?

Offering citizenship in return for investment is mutually beneficial for both successful applicants and the destination countries they choose. The inflows of funds from citizenship programs are considerable, and the macroeconomic implications for most sectors can be extensive. For receiving countries, wealth migration is a sustainable form of foreign direct investment. Just like traditional foreign direct investment, wealth migration increases the value of the receiving state, bringing in capital to both the public sector — in the form of donations to the government, tax payments, or treasury bond investments — and the private sector — in the form of investments in businesses, start-ups, or real estate.

For HNWIs, a second or third passport grants holders the right to travel, trade, and settle in an expanded set of countries and regions, as well as access to all the benefits enjoyed by other citizens of the state in question (education, health care, voting rights, and so on). It also eliminates a great deal of the inconvenience and waiting time surrounding visa applications and passport renewal or replacement processes. Finally, and perhaps most importantly, an additional passport can quite literally save a person’s life in times of political unrest, civil war, and terrorism, or in other delicate political situations.

 

Where do you see most of the HNWIs moving from and migrating to? – And why?

For the third year running, Australia has been the most attractive migration destination for high-net-worth individuals: about 10,000 millionaires migrated there last year, mostly from China, India, and the UK. Experts have proposed a range of reasons for this, including lifestyle opportunities, political stability, proximity to Asian business markets, and relative safety for women.

After Australia, the US, Canada, and the UAE continue to attract significant numbers of HNWIs, while Malta, Cyprus, Portugal, and Spain are also seen as highly appealing destinations for wealthy individuals in search of increased freedom and mobility.

 

How great is the number of individuals who gain citizenship in a country through financial investment, but do not reside there? And how does this affect global wealth trends?

The specific details about where HNWIs choose to reside and for how long is not information that is publicly available. However, it is safe to assume that beneficiaries of citizenship-by-investment are global citizens who often have multiple places of residence and do not see themselves as being tied to a single jurisdiction. It is also important to remember that the number of residence-by-investment programs far outstrips the number of citizenship-by-investment programs.

 

What’s next or what do you predict for future wealth trends?

Global citizenship is now an indispensable asset for wealthy individuals seeking to grow their business and increase opportunities for their family in today’s entirely globalized economy. In 2018, more than a third of global ultra-high-net-worth individuals hold an alternative passport, and another 29% are planning to obtain one.

In general, we anticipate that overall demand for a second passport among wealthy individuals will continue to increase in 2019. More specifically, countries with residence- and citizenship-by-investment programs now account for about one in five wealthy individual migrations, and the ever-growing popularity of these programs indicates that they will continue to shape overall wealth migration trends.

We also believe this demand will be met by increased supply. Sovereign states around the world are seeing the strategic value of investment migration over and above a non-debt baring liquidity injection. Many sovereign states understand that investment migration programs act as a remarkably successful FDI marketing platform that can attract capital and skills to an economy, thereby creating opportunity for all citizens.

 

Want to know more? Head to Henley & Partners’ website to read up further about their services.