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HNIs to skilled professions: Australia regains millionaire magnet crown

Australia has regained the top spot in New World Wealth's 2023 list of destinations forecast to enjoy the highest net inflows of high-net-worth individuals globally, replacing the UAE.

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Sunainaa Chadha NEW DELHI
Australia is expected to attract the highest net inflow of high net worth individuals in 2023 at 5,200, while the UAE has dropped to second place , following its record-breaking influx in 2022, according to the  Henley Private Wealth Migration Report 2023, which tracks wealth and investment migration trends worldwide.

While UAE is still expected to enjoy an impressive net arrival of 4,500 new millionaires this year, Singapore ranks third with a net inflow of 3,200 HNWIs, its highest on record, followed the US with an expected net influx of 2,100 millionaires. 

 Prior to the Covid blip in 2020 and 2021 when the pandemic hampered both the movement and the tracking of millionaires, Australia had secured the top spot from 2015 to 2019. The USA saw the biggest net inflows globally in both 2013 and 2014.

The report features the latest net inflows and outflows of dollar millionaires (namely, the difference between the number of HNWIs with investable wealth of $ 1 million or more who relocate to and the number who emigrate from a country) as projected by global wealth intelligence firm New World Wealth.

According to Henley and Partners,  Australia has been consistently mentioned as the millionaires’ migration destination of choice because of its climate and lifestyle, the world-class education and healthcare, the distance from global crisis hotspots. Moreover, unlike the UK and the USA, Australia has no inheritance taxes or death duties. Add to that ttractive visa programmes aimed at attracting highly skilled professionals.

Approximately 82,000 high-net-worth individuals have moved to Australia over the past 20 years (2002 to 2022), and another 5,200 are expected to arrive in 2023.

These consistently large inflows are possibly linked to Australia’s points-based immigration system which favors wealthy individuals and those with professional qualifications (accountants, doctors, engineers, hi-tech professionals, and lawyers), said Andrew Amoils, Head of Research at New World Wealth.

Other possible reasons for Australia’s popularity among migrating millionaires:

  1. Weather, beaches, and scenery — the country is rich in natural beauty.
  2. Wide open spaces — Australia has one of lowest population densities in the world, with only three people per km2. This compares very favorably to the worldwide average of 60 people per km2 (see latest World Bank data).
  3. Safety and security — New World Wealth’s in-house safety index currently rates Australia as one of the safest countries on earth, along with the likes of Iceland, Switzerland, Malta, and New Zealand.
  4. First-class healthcare system — Australia’s public healthcare system is rated among the best in the world. It is also relatively simple for incoming high-net-worths to pay their way onto the system, unlike the USA, where obtaining healthcare insurance can be complicated and expensive, especially for aging individuals.
  5. Advanced economy — Australia is especially strong in energy and mining, financial services, healthcare, and real estate.
  6. High quality of life for families — the country holds great appeal as an ideal place for bringing up children
  7. Excellent education opportunities — Australia’s education system frequently ranks among the top in the world.
  8. English speaking country — Most high-net-worths globally know English, whether as their first or as an additional language.
  9. Taxes — although company and income tax rates are quite high, unlike most other high-income markets, Australia has no estate duty, which encourages wealthy people to stay in the country and build their businesses for future generations.

Indians too in the last few years have preferred Australia over USA and UK because of the simplified visa process. 

"In the four years prior to the pandemic, Australia was regularly attracting more than 10,000 millionaires each year. The country’s border was effectively closed for two years in 2020 and 2021, and in that time Australia experienced a net outflow of people for the first time in its history. Arrivals, including permanent arrivals, started rebounding in 2022 and the trend has continued into 2023," said Tony Le Nevez, Managing Partner at Henley & Partners Australia.

In May 2022, Australia had a change of government and almost immediately the incoming government announced an increase to the permanent migration program and a review of the immigration system.

Like many developed countries, Australia faces a severe skills shortage and an aging population.

The review  restated the long-held view that the migration of highly skilled people can help increase Australians’ standard of living by contributing to higher productivity levels in the economy.

The country also has one of the lowest pollution levels and has so far been resistant to global recession. "At present, the Indian community is the third-largest group of migrants in Australia. More than 600,000 Indians call Australia home," according to Gaurang Patel of Phoenix Business Advisory.

" Post the pandemic, HNIs are considering alternate residencies in order to have an insurance for health care, lifestyle, education, etc. Australia emerges as a strong location given the large Indian diaspora, the high human development index, economic and civil liberties, and the possibility of receiving a citizenship. Also the highligly skilled visa programme has been a boon to highly qualified professionals, which has helped Australia secure highly skilled talent," said Bijal Ajinkya, Partner, Khaitan & Co.

India, Australia ink new pact for work visas

Earlier this month, India and Australia inked a migration and mobility partnership pact to open up opportunities for students, academic researchers and business people.

Under the new scheme, Indian graduates of Australian tertiary institutions on a student visa can apply to work and pursue professional development without visa sponsorship for up to eight years. This programme will begin from 1 July 2023.

The list of eligible educational qualifications covers engineering, renewable energy, ICT, mining, artificial intelligence, AgriTech, and FinTech. More areas will be added later.

Mobility Arrangement for Talented Early-professionals Scheme (MATES), a new pilot program, will be included with an annual cap of 3,000 places for 4 years.

Mobility Arrangement for Talented Early-professionals Scheme will provide a new mobility pathway for new career professionals with some knowledge in skills, and Indian graduates will be considered more to work and live for up to 2 years in Australia.

The Australian government also said that the current visa process for high-skilled professionals will be made quicker and easier.


The Global Talent Independent Programme
Launched as a pilot program in 2019, the Global Talent Independent Programme was designed to help grow Australia’s innovation and tech economies by providing a streamlined pathway to permanent residence for highly skilled executives, businesspeople, entrepreneurs, and professionals. The future-focused industry sectors targeted under the program include agri-food and agtech, digitech and fintech, education, health services, and renewable energy.

Over 25,000 Global Talent Independent visas have been issued since 2019, and a further 5,000 places have been set aside for the Global Talent Independent program for the 2023/24 financial year.

 The Australian government is seeking the best and brightest global talent in the following 10 future-focused sectors:

Resources, energy, and mining technology
Agricultural technology (agtech)
Defense, space, and advanced manufacturing
Financial services and technology (fintech)
Health industries and medical technology (medtech)
Circular economy
Infrastructure and tourism
Education
Cyber security
Quantum information, advanced digital technology, data science, and information and communications technology (ICT)

Golden visa getting scrapped?

Authorities in Australia are planning to scrap the Significant Investor Visa (SIV) program, also known as the Golden Ticket, which offers visas to all persons who invest at least $5 million in this country.

A government review published in March found that Business Innovation and Investment Programme migrants contributed less to the economy than the average Australian, as the cohort, despite their wealth, tended to be older and earned lower incomes through capital returns on passive investments, reported Reuters. A new  migration strategy iex expected be released later this year, which would include "radically reshaping" the BIIP programme.

India's migration and mobility partnership with Australia
In Decemeber 2022, India and Australia also inked the conomic Cooperation and Trade Agreement (ECTA), under which  a new category of 4-year visas for investors will be introduced. Australia is also expected to issue 1,800 new visas to Indian chefs and yoga instructors and also grant students work opportunities after their education.

 

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First Published: Jun 20 2023 | 11:15 AM IST

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