SINGAPORE: While many of China’s uber-rich have been moving to Singapore for some time now—and some have bought choice properties—the expected outpouring of dollars through investments has not occurred, a new report says.
Over the past few years, an influx of wealthy Chinese moved to Singapore due to the country’s reputation as a tax haven. And even last year, they kept coming in amid President Xi Jin Ping’s crackdowns and Covid-19 shutdowns.
However, a new report from Bloomberg says that despite the expectation from wealth managers and financial institutions of an influx of investments, this has simply not happened, despite the wealthy spending on properties, luxury cars, and golf club memberships.
“The relative pittance of new business from super-wealthy Chinese emigres is becoming a hot-button topic and possible prelude to social discord as lawmakers seek answers from the government. When tax exemption programs were changed to attract family offices, part of the pitch was that the new money would boost investments and spark a wave of employment.
Instead, Singapore is mostly seeing higher prices for everything from condos to cars,” Bloomberg reported on Tuesday (Apr 11).
Two reasons the report cites for the lack of investments are that the ultra-rich already have investments in place and are still unfamiliar with Singapore’s capital markets. Thus, it may take time until they feel comfortable with new wealth advisers.
The Chief Operating Officer of Crossinvest (Asia) Pte, Ms Lucy W. Gao-Azak, is quoted in Bloomberg as saying that Singapore will “never be the home market for Chinese investors and they’ll always invest in what they’re familiar with. Investors will rarely sacrifice and compromise performance of returns for any regional bias.”
In February, the national British daily broadsheet The Telegraph said that Singapore has become a “playground for Chinese ultra-rich” who are avoiding a crackdown on the well-heeled.
However, it added that their lavish spending habits are wreaking havoc on Singapore’s real estate market, sending prices soaring.
A move to Singapore is not a new phenomenon for China’s richest.
In 2022, an estimated 10,000 high-net-worth individuals were looking to pull US$48 billion (S$66 billion out of China), industry experts told Bloomberg. /TISG
Reddit users comment on Telegraph article that called SG a ‘playground for ultra-rich Chinese’