China’s number of high-net-worth individuals (HNWIs) is expected to grow in the next five years. This growth has spurred a rapidly evolving wealth management sector. Wealthy Chinese, concerned about the security of their wealth are looking to diversify their investments with second citizenship, the ultimate Plan B.
In this article we look at the growing number of HNWIs in China, the importance of wealth management, and why investing in second citizenship in the Caribbean is the perfect Plan B for investors.
Wealthy Chinese Growth Trends and Predictions
According to the 2021 Wealth Report by Knight Frank, Asia will host 24% of all UHNWIs [ultra-high-net-worth individuals] by 2025. The continent is already home to more billionaires than any other. The Chinese Mainland’s wealthy are forecast to grow by 246% by 2025.
“The number of UHNWI in China has grown by 137% in the past five years and is expected to grow by 46% in the next five years,” said Martin Wong, associate director of Greater China area research and consultancy, at Knight Frank.
“By 2025, the UHNWI population in China will reach over 103,000, which would put it firmly in second place worldwide.”
The Importance of Wealth Management
China’s wealth management landscape is rapidly evolving. This is due to faster than ever wealth creation, a shift in mindsets and expectations of clients and regulators demanding a higher level of stewardship of companies and assets in portfolio selection.
Current global uncertainty has investors concerned about the security of their wealth and assets in their home countries.
Citizenship by investment programmes have become a powerful tool for high-net-worth individuals to ensure wealth diversification and secure a better future for themselves and their families.
In our recent Plan B Podcast, Dmitry Zapol, a dual-qualified international tax advisor working at IFS Consultants in London, spoke to us about finance diversification and citizenship by investment.
“When you diversify your assets, you minimise your risks, and you make sure that you don’t have any nasty surprises going forward,” says Zapol.
Why Wealthy Chinese Need to Have a Plan B
The pandemic drastically transformed lives across the world. Those in the position to do so are considering their government’s pandemic responses, healthcare options, and possible safe havens to ensure they have a backup plan for the future.
Over the past decade, the primary motivations amongst those seeking second citizenship include having global mobility, access to quality education, domestic wellbeing, improved security, and economic opportunity.
“Mobility, both in the present and as a future hedge, is a strong driver of demand for citizenship-by-investment programmes, followed closely by business advantages,” says Professor Kristin Surak, who researches the motivations that drive investment migration at the London School of Economics.
CS Global Partners has noted that the majority of Chinese clients are business owners who are motivated to find a solution to protect their wealth. Education reforms are a big factor for wealthy Chinese parents, and second citizenship can assist with overseas education options for their children.
Micha Emmett, CEO of CS Global Partners, has noted the marked increase in second citizenship applications from Chinese nationals over the past year. “The pandemic has left many individuals feeling shaken and insecure by the global response. Many people are now looking to relocate their families to a safe and secure location that offers all the perks of medical care, educational opportunities, as well as social and financial security,” she said.
Why Opt for Caribbean Citizenship?
The Caribbean region, renowned for its natural beauty, offers appealing citizenship by investment programmes for Chinese investors. Caribbean nations offer some of the most affordable options for investors looking to gain second citizenship. The programmes enable wealthy, reputable individuals to obtain citizenship in the Caribbean in return for an investment. Citizens may then apply for a passport. This diverse region has massive economic potential and growth opportunities.
‘What makes the Caribbean model a superior offering is that, in most cases , there is no need to spend time in that country, unlike other countries, where substantial residence is a prerequisite and therefore very limiting to those unable to support frequent travel between their international homes,’ says Emmett.
Caribbean citizenship by investment programmes are some of t he oldest and most trusted programmes and continue to be rated the best in the world by the CBI Index. The CBI Index is a comparative ranking system of citizenship by investment programmes globally, published by the Financial Times’ PWM magazine.
Selecting the right citizenship by investment programme is vital and requires careful consideration by the individual and their family. Speak to an expert at CS Global Partners and start your journey to second citizenship today.