Singapore is seeing an influx of ultra-wealthy families from China looking to protect their wealth due to Beijing's recent crackdowns on tech billionaires and tax-shy celebrities, as well as three years of zero-COVID policy, which only ended last month, have led many rich Chinese to look for a safe haven.
The important Asian financial centre checks all the boxes for relocating tycoons.
For the past six decades, Singapore has been ruled by a single party, the People's Action Party, and labour strikes and street protests are prohibited. Taxes are relatively low, and the majority of the population is ethnic Chinese.
Recent Chinese arrivals have made their presence felt in Singapore, with some relocating to luxury homes with waterfront views on Sentosa Island, which also houses a theme park, a casino, and a prestigious golf club.
"You can only imagine how they spend their money. It's insane, "Pearce Cheng, CEO of AIMS, an immigration and relocation firm, agreed.
He recalled attending a Chinese client's party where he was served a rare Japanese "Yamazaki 55" whisky worth around US$800,000 per bottle.
Cheng's firm also assists wealthy Chinese clients in finding luxury condos, hiring chauffeurs, and enrolling their children in private schools. It has even spent US$61,000 on cigars.
The newcomers drive Rolls Royces and Bentleys and are frequently seen at top-tier golf clubs such as the exclusive Sentosa Golf Club, which charges foreign members US$670,000 per year.
"Many of them are younger Chinese, dressed in fashionable designer clothes, and they usually keep to themselves and dine amongst themselves, which is understandable," explained Benny Teo, managing director of Blazon, a golf consultancy.
"I KNOW MY MONEY IS MINE WHEN I'M HERE."
Moving to Singapore puts China's wealth beyond the reach of Beijing, whose recent high-profile crackdowns have alarmed billionaires.
When Chinese regulators cancelled a blockbuster initial public offering (IPO) in 2020, Alibaba Group co-founder Jack Ma, one of the most well-known Asian tycoons, lost an estimated US$25 billion.
Other Chinese tycoons are concerned that the Communist Party will apply similar pressure or even take over their businesses at low prices, according to an accountant familiar with the situation.
"Moving to Singapore is about ensuring that the family wealth is safe and can last for several generations," explained the accountant.
According to another industry source, Singapore is increasingly viewed as a home rather than just a backup plan, with clients telling him, "At least when I'm here, I know my money is mine."
According to the Monetary Authority of Singapore, the number of family offices - wealth management firms dedicated to individual and group assets - increased from 400 in 2020 to 700 in 2021.
Loh Kia Meng, co-head of Dentons Rodyk's private wealth and family office practises, estimated that 1,500 family offices would have been established by the end of last year.
"I wouldn't be surprised if by the end of 2022, one out of every two new family offices comes from China," he said.
"COMFORTABLE NEUTRAL ZONE"
Analysts expect the outflow to continue even though China's strict zero-COVID policy and curbs have now been lifted.
Political tensions between Beijing and Washington are fueling the desire of China's wealthiest to relocate abroad.
According to Song Seng Wun, a regional economist with CIMB Private Banking, Singapore is a "very handy neutral zone" where the mega-rich can conduct business.
The country has skillfully managed its relations with both Washington and Beijing, maintaining close security ties with the US while maintaining strong trade ties with China.
"Media attention on prominent wealthy individuals establishing family offices in Singapore has cast a spotlight on our small island and (has) piqued interest," said Loh.
"If the world's wealthy are gathering in Singapore, why not me?"
Source: AFP/sn
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