HSBC look at expat finance,...   In which country is lifestyle...

Russia is top wealth destination for expats, Europe at the bottom of the league

12 November, 2010 08:31  EasyExpat EasyExpat

With the 2010 Expat Explorer, HSBC released the result of its survey on expats' financial aspects, the first of three reports to be published.

Finance - © Fotolia.comThe bank explores top locations for salaries, levels of disposable income and luxuries. The report also takes a look at how the expat economy has changed since 2009.

The survey is now in its third year and reached over 4,127 expats in about 100 countries this year. Two years ago published the result of the survey 2008, and in 2009 we published the Halifax report on British expatriates.

Russia is home to the wealthiest expats, followed by the Middle East

Expats in Russia remain the wealthiest in the world, with 36% earning over $250,000, even invreasing from the 30% a year ago. In fact, the Middle East, Singapore and Russia dominate the top quartile of the Wealth Hotspot leader board in 2010, while expats in mainland Europe and South Africa are accumulating the least amount of financial wealth.

The BRIC countries are emerging as expat hotspots while those moving to mailand Europe are retirees

The clear hostpots for expat is within the BRIC countries (Brazil*, Russia, India and China) with about 70-80% of expats saying they earn more in their host country than in their country of origin (to compare with 63% of all expats).

There is not surprise to see that, with Asia and the Middle East weathering the financial storm particularly well compared to countries in the Eurozone, a greater number of expats moving to those countries will be rewarded with higher salaries and career progression.

In average, only one quarter of expats are earning less than $60,000 accross the globe. 

Expats in mainland Europe are retirees

At the opposite end of the league table we find expats in Europe, 62% of expats living in SpainRetiree couple - © Andrejs Pidjass - earn below $60,000, as do almost half of the expats living in France in the Netherlands and Germany. They are joined by South Africa with 36% earning below this figure.

This is explained by the large number of retirees (Spain, 38%; France, 33%), with many choosing to move specifically to retire (25% and 21% respectively). The overall percentage is only 5% of all expats. With Thailand also being a prefered destination for pensioners, those countries actually rank higher when it came to lifestyle (they topped Expat Explorer’s 2009 ‘quality of life’ poll).

Expats are repatriating their money

Although saving levels amongst expats as a whole have dropped since 2009, two third of expats are still saving more whilst working abroad and one in five are able to pay off more debt than when they lived in their country of origin. Expats in the UK are the most likely to be accumulating more debt (11%), followed by Australia (9%), despite the fact that about half expats in these countries are also able to save more than in their country of origin.

A large proportion of wealth in longer term investments is repatriated (property, equity and bonds), whilst general savings and investment into company shares are predominantly carried out within their host country. Expats in the Middle East are the most likely to repatriate their property wealth (0% investing in Saudi Arabia or Qatar).

Spain (29%) and France (36%) have a much smaller percentage of expats saving more than in their country of origin, but again this is likely to be due to the larger number of retirees amongst this population.

Pessimism in Europe but no re-location

Almost half (47%) of the expats surveyed believed that the economy in their current country has become worse since the start of 2009. However this number rockets for expats based in Spain (93%), Belgium (60%), France (60%) and the United Kingdom (67%).

The UK also scores especially low as two-thirds of the expats believe that the situation in the UK deteriorated over the past year and a large proportion saying that economic instability has had a visible effect on their career prospects. They also agree that the cost of living was considerably higher than in their country of origin.

This was in contrast to the economies that have escaped the worst of the economic downturn, where a number of expats living in Russia (45%), India (16%) and China (9%) were feeling less negative about their respective host economies and those in Brasil were clearly optimistic.

However when it comes to re-locating due to the financial turnmoil, expatriates in European countries such as Germany, Spain, France and the Netherlands still believe they are financially better off in their current country of residence, probably due to the high number of retirees who remain relatively unscathed by this economic uncertainty. 

Regional League Tables: WEALTH & INCOME

1-Russia Federation
2-Saudi Arabia
4-United Arab Emirates
9-Hong Kong
12-United States
16-South Africa
20-United Kingdom

* Brazil sample size is 29 and therefore did not make it in to the overall league table.


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