Millionaires are fleeing China at a faster pace as the post-COVID economic rebound fizzles

• Millionaires are fleeing China at a faster pace as the post-COVID economic rebound fizzles.

• China will see a net loss of 13,500 in 2023, up from 10,800 in 2022, the Henley Private Wealth Migration Report said.

• Meanwhile, the US will see a net gain of 2,100 millionaires, up from 1,500 last year.

Millionaires are fleeing China at a faster pace as the economy's rebound from zero-COVID restrictions fizzles.

China will see a net loss of 13,500 high-net-worth individuals in 2023, up from 10,800 in 2022, according to the Henley Private Wealth Migration Report.

The world's second largest economy continues to lead the world in the number of lost millionaires, a trend that has been going on over the last decade, according to Henley.

"General wealth growth in the country has been slowing over the past few years, which means that the recent outflows could be more damaging than usual," wrote Andrew Amoils, head of research at New World Wealth, in Henley's report.

After China's economy expanded strongly from 2000 to 2017, the growth of millionaires since then has been negligible, he added.

And in more recent years, bans by the US and other other countries on Huawei technology was a major blow for China, Amoils said, as was the worsening in international relations from the fallout over the coronavirus and tensions over Taiwan and Hong Kong.

The Henley report also comes as China's post-COVID economic recovery has disappointed. First-quarter GDP growth saw a bounce from the prior quarter. But more recent data have pointed to slowing growth in retail sales as well as drops in home sales, industrial production and fixed-asset investment.

The yuan and Chinese stock indexes have tumbled this year, with some commentators calling the rebound narrative a "charade" and even predicting that China is headed for a "lost decade."

Meanwhile, India is poised to lose fewer millionaires, even though it just topped China as the world's most populous country and overtook the UK last year as the world's fifth largest economy. This year, India will lose 6,500 millionaires on a net basis, down from 7,500 in 2022.

Among the world's top millionaire gainers, Australia leads with a net addition of 5,200, up from 3,800 last year, followed by the United Arab Emirates with 4,500 and Singapore with 3,200. The US is expected to see 2,100 more millionaires this year, up from 1,500 in 2022.

"In general, wealth migration trends look set to revert to pre-pandemic patterns this year, with Australia reclaiming the top spot for net inflows as it did for five years prior to the Covid outbreak, and China seeing the biggest net outflows as it has each year for the past decade. The notable exceptions are former top wealth magnets, the UK and the US," said Henley & Partners CEO Juerg Steffen.

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