Even in countries where the economy is reported to be weak, expats are still reporting higher earnings than in their home country, according to the HSBC 2011 Expat Explorer survey.
Some 37% of expats worldwide believe the economic situation in their country has stayed the same, while 30% think it has worsened in the last year. But this is more positive than last year’s survey which found that almost half of expats believed that the economy in their current country had deteriorated.
Indeed, the survey shows that expats remain relatively robust to the wider turmoil, with only 14% of expats who believe the economic situation in their country has deteriorated actively looking to return home, and 63% intending to stay in their current location.
Downturn defiant
“Expats are seemingly downturn defiant with their finances remaining comparatively unaffected by the wider economic turmoil within their country of residence. Supporting this assumption is the fact that expat finances remain strong even in countries which have seen significant deterioration such as Egypt, Bahrain and Japan,” the survey says.
Saudi Arabia tops the survey’s expat economic league table, followed by Egypt and Singapore. Expats in these countries work predominantly in the banking or financial sector, the survey shows, and they cited career prospects as one of the key reasons for moving.
When asked about the top benefit of being an expat, financial wealth and financial security were rated highest by those in Saudi Arabia, while expats in Singapore felt that personal development and a better quality of life were more important than the financial aspects of their move.
The survey suggests that one reason there is a lot of confidence in countries like Egypt and Bahrain, which experienced political unrest in 2011, is because expats have much higher disposable incomes than they would in their home country and are able to invest more and save more.
Eurozone crisis
The eurozone debt crisis has affected expat perceptions with the UK regarded as stronger than countries like Italy and Spain. Some 44% of expats in Italy feel the economy will deteriorate and 38% in Spain, whereas it is just 25% in the UK.
Of all the Eurozone countries, expats in Germany are most optimistic about their economic outlook. German expats are confident the economy will improve and only a very small number, 3%, believe the situation will deteriorate.
The survey reveals that expats do not move to the UK to make money, with just 7% saying that financial wealth is the main benefit of relocating. For them, career and money prospects remain the principal motivation to move, with 73% stating that this was their top reason for becoming an expat.
But they find the UK costly. Although 19% of expats in the UK feel they have much more disposable income now than they did in their home country, 49% admit to spending much more on accommodation, and they find food and public transport much more expensive.
Complications
Although expats benefit from higher earning potential and income, moving abroad also leads to complications, with 71% of expats saying their finances have become more complex since relocating, owing to moving money between countries and managing finances in more than one country.
According to the survey results, the highest ranking countries for financial complexity are the US, Germany, Switzerland, India and Brazil. Yet with the exception of Brazil, expats in these countries are among the least likely to hold an offshore bank account, while expats in Thailand, South Africa and Vietnam are most likely to hold offshore accounts.
