Editor’s note: This article was first published in April 2013, as a news piece based on a WealthInsight forecast that Swiss assets would fall below $2 trillion by 2016 and Singapore would overtake Switzerland by 2020. Those dates have passed.
Thanks to its generous tax regime, Singapore has until now been an excellent refuge for millionaires. Now a report by WealthInsight, a London-based research firm, says that Singapore is the fastest-growing country in the world when it comes to wealth management, with more than $550 billion under management.
Switzerland has $2.8 trillion under management, which according to the report represents 34% of the world’s wealth, estimated at $8.15 trillion. However, Singapore could overtake Switzerland by 2020 for several reasons.
According to WealthInsight, the money managed by Swiss banks could fall below $2 trillion in 2016, while the money in Singapore could quadruple.
The reason: recent scandals over money from corruption found in Swiss bank accounts, along with legal action in the United States and Europe, have broken through the banking secrecy Switzerland used to boast about, much to the dismay of the rich. The warning that governments are looking at adjusting “tax codes” to go after money in tax havens more aggressively could make Switzerland a very unattractive tax haven.
According to some offshore asset protection firms, “Switzerland’s wealth management model is under intense pressure”.
And while the West is cracking down on wealth in Switzerland, Singapore is welcoming the new rich of the Asian continent with open arms. Asian billionaires, who are expected to grow both in number and in fortune, especially in China, already need to hide hundreds of billions abroad. Now that doubts have been cast on Switzerland, their preferred destinations would include Singapore, the Cayman Islands and Hong Kong, and, according to WealthInsight, more than half of the offshore money in Singapore is Chinese.
Further reading
- Security systems for the super-rich
- What does it really mean to be rich? A former Goldman banker explains
Featured image: Basile Morin, CC BY-SA 4.0, via Wikimedia Commons.
