President Xi Jinping’s decision to dismantle COVID travel restrictions is accelerating an exodus by wealthy Chinese, who could fuel billions in capital outflows as they plow cash into property and assets abroad.
President Xi Jinping’s decision to dismantle COVID travel restrictions is accelerating an exodus by wealthy Chinese, who could fuel billions in capital outflows as they plough cash into property and assets abroad., many rich Chinese have begun travelling overseas to check out real estate or firm up plans to emigrate, immigration consultants said. That threatens a brain drain in the world’s No. 2 economy as well as outflows that could pressure its financial markets.
Before the pandemic, China suffered capital flight of some $US150 billion annually from people going overseas, but that is likely to rise 2023 since after three years of trave restrictions, said Alicia Garcia Herrero, chief economist for Asia Pacific at Natixis. Her calculation – worked out by looking at unexplained differentials in global tourism data – is an estimate of funds left abroad permanently by Chinese nationals who travel.
Denny Ko, a Hong Kong immigration lawyer who advises wealthy Chinese clients, said the truly rich had long held contingency plans, and those now seeking options are not as wealthy and include the upper middle class, entrepreneurs and senior-level executives. They have been hiring in Singapore to serve wealthy Chinese that are investing in the city state. The flood of money into the city state has pushed prices higher for mansions, golf memberships and luxury cars.
Many of her colleagues and friends have either emigrated or are exploring that option, she said. “It’s time to reactivate my emigration plan now that we can travel abroad, and it should be much easier to process these things than earlier when we still had the lockdowns,” she said.China has capital controls, allowing its citizens to convert only $US50,000 worth of yuan into foreign currencies each year.
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