Home » Expat Focus Financial Update 25 July 2016

Expat Focus Financial Update 25 July 2016

Best locations for expats revealed

For expats who are looking for entrepreneurial opportunities or who are simply wanting the best place to move to, a new report has revealed which cities offer the best opportunities.

The report from accounting firm BDO says that entrepreneurs should head to Hong Kong with London following closely in second place, while the best places for expats with families are Luxembourg and Vienna.For expatriates retiring overseas, the best locations are Sydney, Malta, Luxembourg and Limassol in Cyprus. Vienna also makes the top five list.

The firm analysed 26 locations around world for a variety of issues including political risk, personal safety, education, leisure pursuits and healthcare costs.

In addition to Hong Kong and London, expat entrepreneurs should also consider Vancouver in third place and in joint fourth place are Geneva, Sydney, Vienna and Dubai. They are then followed by Singapore, Copenhagen and Monaco.

The list for expats with families is topped by Luxembourg and then Vienna, Hong Kong, Geneva and Dubai. They are followed by London, Singapore, Vancouver and Dublin with Miami in the 10th spot.

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Expat retirees should consider Sydney and Malta, followed by Luxembourg, Limassol, Vienna and Faro. They are followed by Auckland, Vancouver, Copenhagen and Monaco.

BDO’s report also highlights that expats can benefit from various tax regimes by moving to a welcoming country, with many offering favourable taxes to attract foreigners. These attractions range from low rates of tax to exemptions for foreign-earned income.

Indeed, the report points to Australia and Austria as having the most favourable tax regimes for expats followed by Brazil, Canada and Cyprus.

British expats who live outside Europe will gain from Brexit

With the fallout from the Brexit vote still continuing with no set deadline for the UK’s exit from the EU, an analysis has revealed that British expats who live and work outside of Europe are those who will gain the most from Brexit.

Global Risk Insights (GRI) says that once the UK government invokes Article 50 of the Lisbon Treaty then the future for British expats in Europe will become clearer, though this could take two years. Their analysis also reveals that people who own property in the EU would not lose their ownership rights under the Vienna Convention.

Issues that need to be tackled as quickly as possible in the negotiations, the firm says, are healthcare, retirement benefits, residency and working legally.

However, GRI says that British expats who live and work outside the EU will see their future hanging on the value of sterling. Apart from this, they are in a stronger position until the UK’s relationship with the EU is clarified.

Their report points out that Canada is seeing a big increase in the number of Brits wanting to live and work there. Currently 150,000 British citizens work and live in the United Arab Emirates, which highlights the importance of countries outside of the EU to the UK.

However, unless the UK can come to some agreement on freedom of movement rules, the future of British expats in the EU may yet come under threat.

Advice for living and travelling in Europe

Meanwhile, the UK government has unveiled a webpage on their website to give advice for expats living in and travelling in Europe after the EU referendum result. There’s also information about pensions, passports and healthcare.

The page details what steps the UK government is taking and how the transition may affect British expats living in the EU.

The website also highlights that until the negotiations are concluded there will be no immediate changes to living and working arrangements for British expats in Europe and EU nationals living in the UK.

Kiwis return home

Growing numbers of New Zealanders are returning home after living and working overseas while the number wanting to leave is falling, according to statistics.

Statistics New Zealand says the country saw a net gain of nearly 72,000 migrants in the 12 months to May, with 3,500 citizens leaving to head overseas.

The country saw a record 68,400 net gain of people; and with 34,200 New Zealanders leaving and 30,700 arriving, means this is the narrowest recorded gap for 25 years.

The countries sending the largest number of migrants is led by India, then China and the United Kingdom.

Complaints in Oman

Expats in Oman are being reminded that from 1 August, they can only file labour complaints against their employer through the Ministry of Manpower website.

After that date, the Ministry will not accept any written complaints.

The rules also extend to Omanis. All nationals and expats with old residence cards are being urged to renew them for the new PKI-enabled cards which allow them to use the government’s e-services.

Meanwhile, a crackdown by the government on mandatory lunch breaks which some employers have not been giving their employees has been welcomed by workers across Oman.

With the summer temperatures rising, workers are instructed to stay out of the heat between midday and 3pm.

Last year, nearly 400 companies were fined by the Manpower Ministry after being found violating the midday break rule.

In an effort to crack down further, the Ministry has set up a hotline for employees to report employer violations.

Expats working in the oil industry

Expats who work in the world oil industry will welcome a new report that reveals that while the world’s oil supply is running out, it will still take another 70 years for the reserves to run completely dry.

In a report from Norwegian firm Rystad Energy, the world’s recoverable oil assets are still good for 20 billion barrels every day.

The report reveals that the world’s leading oil power is the USA which has 264 billion barrels available from its recent discoveries, existing fields and yet to be discovered oilfields.

Next on the list is Russia with 262 billion barrels and then Saudi Arabia with 256 billion barrels. They are followed by Canada, Iran, Brazil, Venezuela and Mexico.

When the figures are broken down, oil from shale accounts for a third of the world’s oil reserves with offshore fields accounting for a third as well.

However, the report says that the plunge in world oil prices is down to the rise in taking oil from ‘unconventional reserves’ such as shale and prices look set to be depressed for some time yet.

Saudi shops could shut at 7pm

It was mentioned briefly in the last edition of Expat Focus finance news that ministers in Saudi Arabia are looking at a slew of proposals that could see shops closing at 9pm.

However, one minister says that most shops in the Kingdom should close by 7pm.

The proposals have been unveiled for consultation by the Ministry of Labour and Social Development and a spokesman said the 9pm idea is under consideration before the plan is submitted to higher authorities.

The proposals could also see restaurants, coffee shops as well as ‘entertainment centres’ allowed to open until midnight during the week and at 1am at weekends.

The ministry says that by regulating working hours they will boost employment prospects in the private sector for Saudi citizens, with one supporter of the plan saying that expats run most of the shops in the Kingdom and would ‘love to open shops 24 hours’ and they are unconcerned about opening and closing hours.

However, one leading Shoura member, Fahad Jomaa, says the proposals should be changed so shops cannot open before 8.30am and close by 7pm with breaks for prayers and lunch.

Retaining expat employees’ passports

Meanwhile, employers in Saudi Arabia are being told they cannot retain their expat employees’ passports without their consent.

The Ministry of Labour and Social Development says employers do not have the right to keep a passport. The employee needs to sign a written agreement in their own native language and in Arabic stating clearly that their employer has retained their passport and there must be a date of receipt.

Employers face being fined if they do retain a passport without permission.

Middle East expats head for holidays in Spain

Growing numbers of European expats who work in the Middle East are opting to spend their summer holidays in Spain, according to new data.

Preferred Hotels and Resorts says there has been a big rise in the number of expat travellers who are adding a summer break onto their annual trip home.

A spokesman for the firm said: “There is a growing trend from our members in the Middle East to add a summer holiday to their trip and Spain tops a list of their preferred stop-offs.”

The survey reveals that expats from the Middle East are tempted by Spain because it’s easy to get to, safe and affordable.

The top five destinations for a holiday for expats who work in the Middle East include the UK, France, Turkey and America.

Difficulties buying property in the UAE

Even when expats in the UAE live and work there for several years, most do not buy properties because they cannot afford the deposit and they do not earn enough to get a mortgage – and mortgages now have tightened lending criteria to make it even more difficult, according to a survey.

Only 30% of expats have bought somewhere to live while working in the UAE and 70% are renting.

The UAE has a mortgage cap of 25% in place for the purchase of a property which, 69% of expats said, meant they struggled to raise a deposit to pay for a home where prices are also ‘too high’. Many also believed they would not qualify for a mortgage.

A spokesman for the firm that undertook the survey said: “It’s clear the need is there but high fees, deposit requirements and the mortgage cap means the market is being stopped from maturing like our Western counterparts.”

The spokesman added that if the country could overcome these obstacles then the future for UAE’s property market looks very bright indeed.

One news report asked a number of property experts in Dubai about their views on the survey and most said there are increasing numbers of expats who are either planning or are buying property there.

The experts pointed out that rather than renting, expats are looking to buy a villa or flat and it’s not just high earners who are thinking of doing so with expats who earn Dh8,000 a month also tempted by the opportunity.

British expats suffer with contraction of insurance market

British expats living abroad wanting life cover from a UK based provider are finding it increasingly difficult to do so and can only get a quote ‘from 16% of the market’, according to a survey.

Unusual Risks says the market has fallen sharply over the past few years when 33% of life companies were happy to offer life insurance products to British expats who were living overseas.

But in recent years, some of the biggest names in the insurance sector have withdrawn from the market covering expats.

Of the firms still willing to do so, just 8% will accept an application for critical illness cover and only then in limited circumstances.

Industry experts say there are several reasons for this decline in the number of life cover firms wanting to sell products to expats and these include a change to the tax rules and regulations in Europe and the UK.

In other news…

Expats in America will be able to enjoy a new streaming service being planned by the BBC featuring many of its most famous productions.

A survey of women working in the public sector in Oman has found that 76% of employees are expats and 24% were Omanis.

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