More Taiwanese Tycoons Relocating Wealth to Singapore with 20-30% Annual Increase

Singapore stands out as a "calm oasis" of stability in an increasingly uncertain geopolitical environment. Several wealth management professionals have revealed a growing trend of high-net-worth individuals (HNWIs) from Taiwan moving their wealth to Singapore in recent years. Consequently, the businesses serving them, including law firms and private banks, are also expanding.

Waine Lim, a director at Bayfront Law who provides consulting services for family office applicants, told Lianhe Zaobao that he has observed a significant increase in the number of Taiwanese HNWIs transferring their wealth to Singapore over the past two to three years, with an annual increase of 20% to 30%.

He pointed out that Singapore's economic and political stability has led Taiwanese tycoons to view it as a safe and neutral jurisdiction for wealth placement. Moreover, as the world's third-largest financial center, Singapore is seen as a private banking hub for deploying assets across multiple product categories.

Diverse Backgrounds, But Few from the Semiconductor Industry

Regarding the backgrounds of these Taiwanese HNWIs, Edmund Leow, Senior Partner and Chief Operating Officer at Dentons Rodyk & Davidson LLP, said they come from various fields. In earlier years, these industries included manufacturing, technology, pharmaceuticals, real estate, and finance, with most wealth originating from entrepreneurship.

Waine Lim observed that these Taiwanese HNWIs primarily own their businesses, some with 40-50 years of operating history. Recently, second-generation entrepreneurs have also emerged. While clients mainly come from traditional industries, there has been a recent influx from the tech sector. However, the proportion of Taiwanese HNWIs from the semiconductor industry remains insignificant.

Singapore Expected to Gain 3,500 Millionaires as Taiwan Loses 400

According to the Henley Private Wealth Migration Report 2024, released last month by London-based investment migration consultancy Henley & Partners, Taiwan is expected to see a net outflow of 400 millionaires this year, while Singapore is projected to gain a net inflow of 3,500 millionaires.

Edmund Leow noted that some Taiwanese tycoons not only want to place their wealth in Singapore but also wish to live here. With a large Chinese population, integration is easier in terms of language and culture, making Singapore very suitable for residence.

Challenges and Opportunities

However, Taiwanese tycoons transferring their wealth to Singapore also face challenges. Waine Lim revealed that current regulations require family offices to appoint an unrelated third-party investment professional locally. Given the limited local talent pool, meeting this requirement can be difficult.

Additionally, private banks conduct strict Know Your Customer (KYC) processes during account opening, which can take six to eight months before formally applying to the Monetary Authority of Singapore for family office-related tax incentives.

Nevertheless, Lim pointed out that, unlike some regions, Taiwan does not have very strict foreign exchange controls. Transferring funds from Taiwan to Singapore for family office management usually does not encounter problems.

As this trend continues, Singapore's position as a wealth management hub for Asian HNWIs, particularly those from Taiwan, will likely strengthen further in the coming years.