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Grand exodus: this Asean country offers wealth management to those fleeing China and beyond - YouTube
Channel: Lei's Real Talk
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During the Shanghai lockdowns, the English
word "run" became a buzzword in China.
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The Chinese have turned it into a subject
of knowledge and created the word "Runology"
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or "Run Xue."
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The word is so popular that it has its own
Chinese wiki page.
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It means the study of how to escape from China
and immigrate to developed countries.
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Ordinary Chinese citizens as well as the super-rich
are all looking for ways to leave.
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They super-rich have already started the grand
exodus.
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Where are the rich people moving to?
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Hi everyone, welcome to my show.
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I'm Lei.
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On the day that the Chinese regime announced
"adherence to societal ‘zero Covid’ without
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wavering" in April, the search index for "immigration"
immediately soared 440% on WeChat, and 1455%
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on video-related sources.
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Baidu's user behavior data showed the word
"immigration" exploded 400 times in searches
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in April.
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The wealthy regions of Shanghai, Jiangsu,
Guangdong, and Beijing top the list in the
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"immigration" search fever.
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Although ordinary Chinese still favor the
United States, Canada, and Australia as their
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destinations, wealthy Chinese have shifted
their preference from Europe and North America
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to Asia for immigration.
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The tiny Southeast Asian city-state of Singapore
has become a top destination for the Chinese
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rich.
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The number one reason is the fear of Western
sanctions amid the current geopolitical tensions.
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And the other reason is that Singapore offers
a shorter immigration application process.
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Being the world's fourth-largest financial
center in 2021, Singapore is politically stable
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with a mature legal system and a pro-business
environment.
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There is no language barrier for Chinese immigrants
since most people speak Chinese in Singapore.
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Most importantly, Singapore doesn't have a
wealth tax and has lower corporate and personal
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income taxes.
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Companies in Singapore are helping wealthy
Chinese as well as the super-rich from other
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countries transfer their assets to the country
through family office structures.
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Family offices are wealth management advisory
firms that serve ultra-high-net-worth investors
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and their families.
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In 2018, there were 27 family offices in Singapore.
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By 2021, the number reached 453, a 16-fold
increase in just four years.
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Among the 453 wealthy individuals are Sergey
Brin, who is the co-founder of Google, and
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James Dyson, the founder of UK electronic
giant Dyson.
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As of April this year, 143 new family offices
have been added in less than 6 months; 63
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are from China.
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In response to the overwhelming demand, the
Monetary Authority of Singapore announced
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stricter criteria effective this April.
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It doubled the requirement for initial fund
deposits at the time of application from US$3.7
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million to $7.3 million and required applicants
to increase total funds to $15 million within
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two years.
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Also, the family must hire at least two investment
professionals and spend a minimum of $146K
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in business expenditures annually.
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Singapore officials have been cautious about
discussing the origins of the family offices
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and their source of funds.
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In an article published by the Chinese media
Caixin Weekly on June 6, the Monetary Authority
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of Singapore responded to Caixin's inquiry
by stating that it did not have authoritative
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data on the number of SFOs and the inflow
of funds.
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A SFO is a single-family office, which is
a higher tier of family office structures.
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It requires a total investment of 100 million
US dollars and offers a dedicated team of
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accountants, lawyers, and investment professionals
to serve the family.
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With the arrival of foreign wealth, Singapore
saw the biggest increase in housing prices
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in 2021 in more than a decade.
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The sales of luxury homes tripled year-on-year.
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Singapore is now the world's second-largest
market for foreign real estate investors after
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the United States.
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A Chinese buyer from Fujian province bought
20 units at Canninghill Piers, an upscale
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private housing development in Singapore,
for a total estimated value of US$62 million.
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According to a source familiar with the transaction,
the buyer's funds were transferred from Indonesia
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to Singapore.
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The buyer is considering buying 10 more units,
bringing his total purchase to more than $73
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million.
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It's common practice for the wealthy Chinese
to buy multiple homes in Singapore through
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a trust that conceals their names.
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On May 9, Singapore's Ministry of Finance
announced a 35% additional duty on trust real
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estate buyers who transfer properties to anonymous
beneficiaries.
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In addition, the duty for foreign property
buyers increased from 20% to 30%.
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The Chinese investor I just mentioned who
bought 20 properties has paid $22 million
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in taxes.
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In addition to moving their wealth, some Chinese
have chosen Southeast Asia as a place to expand
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their businesses.
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Singapore has become the location of many
companies' regional headquarters.
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With the Chinese gaming market struggling
amid the government-controlled license approval
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policy, many Chinese game makers are now choosing
to go abroad to find growth.
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MiHoYo and YOOZOO Interactive have set up
regional headquarters in Singapore.
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Sean Tong and Louis Cheung, co-founders of
China's leading private equity firm Boyu Capital,
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have moved part of the company from Hong Kong
to Singapore.
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Boyu was founded by Alvin Jiang, the grandson
of former Chinese Communist Party leader Jiang
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Zemin.
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The Wall Street Journal reported that Boyu
Capital moved to Singapore in 2019 because
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it worried about Jiang Zemin's weakening influence
in the CCP's internal political fight.
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Anticipating an upsurge of Chinese immigrants
and businesses in Southeast Asia, ANT Group
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announced on June 6 the launch of a wholly
owned digital wholesale bank in Singapore
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called ANEXT Bank.
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ANEXT will serve small, medium-size, and micro
companies in Southeast Asia, particularly
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those with cross-border operations.
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This is the first major international move
by ANT Group in two years since its failed
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$37 billion IPO in 2020.
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A Shanghai-based pharma company, Fosun Pharmaceuticals,
acquired a 60% stake in the largest private
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cancer treatment center in Singapore: OncoCare
Medical.
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Forsun established an office in Singapore
back in 2015, to prepare for growth in the
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Southeast Asian market.
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In addition, as the CCP tightens regulations
on cryptocurrencies, droves of Chinese crypto
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players moved their bases to Singapore in
May 2021 months before Beijing handed down
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the final blow to the country's crypto industry.
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ANT Group and Fosun Group are just two of
the many Chinese companies that have established
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a presence in Singapore.
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Other notable players include Alibaba and
Huawei, Tecent, and Byte Dance.
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As more Chinese move to Singapore, they are
changing the landscape of the country's rich
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and famous.
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Of Singapore's newly announced top 50 billionaires,
8 of them or 16% are immigrant billionaires
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from China.
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The total wealth of these 8 accounts for 35%
of the total wealth of the top 50 billionaires
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combined.
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Four of the new immigrants from China are
in the top 10.
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The co-founder and chairman of Shenzhen Mindray
Medical International, Li Xiting, is the wealthiest
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man in Singapore.
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He has replaced Zhang Yong, the hotpot billionaire
who founded the restaurant chain Haidilao.
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Zhang was the richest man in Singapore from
2019 to 2020.
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The grand exodus is getting on the nerves
of the Beijing authorities.
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So, on April 27, Chen Jie, a spokesman for
China's Immigration Administration, announced
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the Ministry of Public Security's 2022 initiative
called “Operation Mongoose Hunt.”
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The state media outlet Beijing Daily calls
the operation a move by the authorities to
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crack down on so-called illegal immigration
entries and departures.
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But this type of initiative doesn't stop the
ultra-high-net-worth travelers, but it does
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closely scrutinize ordinary Chinese when they
leave China.
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Various internet posts have showed people
having their passports or green cards cut
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up at airports before departing China, while
Chinese returning from abroad were questioned
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about their future travel and emigration plans.
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In the regime's own words, it wants to control
those "departures with malicious intent."
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I think "departure with malicious intent"
is an offense that exists only in China.
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What does it mean?
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A cell phone screenshot obtained by Radio
Free Asia that recorded instructions sent
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to a patrol team at Shanghai Pudong Airport
explains it: "Anyone with hatred for the country
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and the party will not be allowed to leave
the country, if, for example, a permanent
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residence card of another country, a large
amount of foreign currency, or savings certificates
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of another country are found in the luggage.
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[The passport of] those with malicious motives
for leaving the country will be destroyed
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on the spot."
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At this point, a significant number of China's
1.3 billion people want to leave with “malicious
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intent.”
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What’s the regime going to do?
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Some say that the CCP might eventually lock
up the whole country using COVID as an excuse.
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The reality is that it’ll be more and more
difficult for the Chinese to leave.
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Thank you for watching.
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See you soon.
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