The 2023 Wealth Migration Report from Henley & Partners and New World Wealth reveals that many superwealthy individuals are leaving South Africa.
The report tracks the countries and territories with net inflows or net outflows of 100 or more high-net-worth individuals (HNWIs).
It is calculated using the difference between the number of HNWIs who relocated to and who emigrated away from a particular country during a given year.
HNWIs are defined as people with a net worth of over US$1 million – approximately R18.7 million in South Africa.
The researchers said millionaire migration figures could be a telling real-time barometer for the health of an economy, as wealthy people are extremely mobile.
When there are problems in a country, these rich individuals can easily pack their bags and move to a better country.
The 2023 Wealth Migration Report shows that South Africa has 37,800 HNWIs, 98 centi-millionaires, and 5 billionaires.
According to the report, South Africa lost 400 HNWIs to other countries in 2022 and is expected to lose another 500 in 2023.
Although migration is a significant cause of losing rich people, the destruction of wealth is an even bigger problem.
The report revealed that South Africa lost 1,500 HNWIs over the last year.
This means that South Africa’s big drop in millionaires between 2021 and 2022 can be attributed to the huge destruction of wealth in the country rather than the superwealthy leaving.
The Henley & Partners and New World Wealth data aligns with the South African Revenue Service’s (SARS’) loss of taxes through emigration.
Tax statistics provided by SARS show that over 32,000 people ended their tax residency in South Africa between 2017 and 2021.
Of those individuals, approximately 2,700 earned more than R500,000 annually and 1,100 earned more than R1 million annually.