Yachts in front of a private residence around a marina in Singapore on February 1, 2023 (AFP/Roslan RAHMAN)
Singapore is seeing a growing number of very wealthy families leaving China for the city-state of Southeast Asia in order to put their fortunes beyond the reach of the Communist Party, which regards them with increasing suspicion.
Recent retaliation by authorities against tech billionaires, stars who had neglected to pay their taxes, and three years of “zero-Covid” policies, have prompted wealthy Chinese to seek refuge elsewhere.
A growing number of them have taken up residence in Singapore, several sources close to this community told AFP.
The Asian financial hub ticks all the boxes for exiled entrepreneurs.
In this island ruled by the same party for six decades, strikes and demonstrations are prohibited. Taxes are relatively low and the majority of the population is of Chinese origin.
The recent arrival of very wealthy Chinese has not gone unnoticed. Some have settled in luxurious mansions overlooking the sea in Sentosa Island.
“You can’t imagine how much they spend. It’s crazy,” said Pearce Cheng, CEO of AIMS, which offers relocation and immigration services.
He saw at a party at one of his customers, serving a rare whiskey, “Yamazaki 55”, which can be worth up to 800,000 dollars a bottle.
His company helps newcomers find luxury apartments, hire drivers or enroll children in private schools.
The newcomers like to travel in Rolls Royces or Bentleys and frequent very select golf clubs, such as the Sentosa Golf Club, whose annual membership for foreigners reaches 670,000 dollars.
“A lot of them are young Chinese, with trendy designer clothes, they usually keep to themselves, which is not surprising,” notes Benny Teo, director of a marketing consultancy in the golf course, Blazon.
– “Here my money is mine” –
A luxury residence on Sentosa Island in Singapore on February 1, 2023 (AFP/Roslan RAHMAN)
Settling in Singapore allows the richest Chinese to put their fortunes out of reach of the Chinese authorities, after several high-profile cases that scared them off.
Jack Ma, ex-boss of Chinese e-commerce giant Alibaba, suffered an estimated $25 billion in lost revenue when authorities abruptly canceled his group’s 2020 IPO.
Other big bosses fear being the next target of the Communist Party or having to sell their business at a low price, says an accounting manager in this sector.
“Moving to Singapore helps protect the family fortune for several generations,” the specialist told AFP.
Singapore is increasingly seen as a place to live, rather than a fallback, another industry source said.
“At least when I’m here I know my money is mine,” one customer told him.
One of the founders of a chain of “hotpot” restaurants, Haidilao, recently created his “family office”, a structure that manages the assets of wealthy clients, in Singapore.
The Monetary Authority of Singapore notes that the number of family offices has more than doubled from 2020 to 2021, to 700.
Loh Kia Meng, co-head of a wealth management service at law firm Dentons Rodyk, estimates there will be around 1,500 at the end of 2022 on the island.
“I wouldn’t be surprised if the total figure (…) showed that one in two family offices comes from China,” he says.
– “Neutral zone” –
On the seafront in Singapore, February 1, 2023 (AFP / Roslan RAHMAN)
The trend should continue, even without the restrictions linked to the Covid. Growing tensions between Beijing and Washington are also pushing some entrepreneurs to leave.
Singapore is “a very convenient neutral zone” where the mega-rich can do business, said Song Seng Wun, an Asia region economist for private bank CIMB.
The city-state has managed to maintain both close security ties with the United States and solid trade relations with China.
“The media attention on wealthy people who have established a family office in Singapore has shone a spotlight on our small island,” Loh said.
“If the rich of this world are converging on Singapore, why not me?” think his clients, he summarizes.
© 2023 AFP
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