The three-year stringent COVID-19 quarantine recently came to an end in China. Now, international travellers can enter the country without the worries of COVID-19 restrictions. However, against the backdrop of a stormy economy, the private wealth industry in China is scanning the horizon for alternative locations to hold their wealth – and their sights are set on Jersey.
Three years since the pandemic outbreak, China reopened a very different country to the rest of the world. The economic growth in 2022 dropped to 2.8%, which is the only time in the past 40 years that China has been behind the world average; consumer confidence continues to fall, even after the prompt lifting of restrictions; the sluggish domestic market combined with a dip in property value has diminished the assets of many, in particular those from the wealthy; and it is estimated that many high net-worth (HNW) individuals will establish an overseas home in 2023.
With a struggling economy, the Chinese government is determined to combat the headwinds and welcome the dawn of 2023. It’s said that lifting quarantine rules in November last year was to prepare the economy for a swift rebound. Reshaping the economy, rebooting the market and reinstalling consumer confidence is unarguably at the top of the list.
The Chinese word for “crisis” is 危机. It means “crisis go hand in hand with opportunities”. While China is deeply engaged in combating a series of post-opening crises, there may be a silver lining for the finance industry in Singapore and Hong Kong, and for family offices and wealth centres further afield in leading jurisdictions like Jersey.
With strong connections to the UK, Jersey offers long-term stability. It’s particularly enticing for people making wealth plans and having experienced COVID-19 upheavals. Jersey has a stable government, robust legal system, considerable court experience and a worldwide reputation, making it a competitive jurisdiction. In comparison to five years ago (which isn’t too distant), nowadays Jersey is much better known in the Chinese market.
Close to the Chinese mainland, Singapore and Hong Kong have long been favoured due to the infrastructure and culture similarity to mainland China. Meanwhile, across the globe in the English Channel, the island of Jersey provides a fresh and attractive alternative. Further afield from Asia, Jersey can be perceived as a safe international location for wealth holding purposes. For clients who are looking to experience an English culture through relocation, Jersey becomes a natural structuring choice. Over the years, Jersey has been equipped with tools to attract and serve Chinese clients, such as publications in Chinese, becoming active on Chinese social media, and appointing Chinese-speaking personnel to drive development.
Amongst the Chinese government’s many measures to reboot the economy, a key highlight is encouraging innovation in the technology sector. China Banking Regulatory Commission is said to be commissioned to support small technology enterprises in the fight to revive the economy. These companies are expected to lead growth, create more jobs and compete in the global arena. In China, wealthy individuals who created meaningful fortune in technology are often described as “tech new noble”. In comparison to their counterparts whose wealth was generated from more traditional industries, the “tech new noble” are often young, open-minded and disposed to European culture and lifestyle, presenting new opportunities for Jersey.
As the world enters a new year and continues to recover from COVID-19, the old wisdom from the Chinese zodiac also contributes to a new outlook of 2023 – the year of the rabbit. Ranked fourth on the zodiac chart, rabbit represents agility, curiosity and adventure. With these timely befitting characteristics in mind, may this new year be another good year in Jersey’s China efforts.