Switzerland is predicted to be a mere two years away from losing its position as the world’s top wealth centre, according to a report from PricewaterhouseCoopers’s Global Private Banking and Wealth Management team. Switzerland’s position as world leader has been threatened by increasing regulation throughout Europe and authorities asserting their taxation powers heavily, diminishing the country’s financial reputation.
Switzerland is synonymous with being a tax haven, popular with members of the global financial elite who prize anonymity and privacy from their banking institutions. However, there are signs in the report that Singapore is soon to oust Switzerland top spot, according to the survey that quizzed 200 finance industry professionals from across 51 countries.
Currently sitting on $2 trillion in offshore financial assets Switzerland is still ahead of its global rivals but due to competition from Asian countries, such as China, India, Indonesia and Malaysia wealthy families and individuals are looking outward to jurisdictions that offer greater protection and security to their holdings.
Another report from WealthInsight, a London-based research firm, backs up the results of the PricewaterhouseCoopers’s report stating that offshore assets in Switzerland could slip below $2 trillion by 2016, while at the same time Singapore’s offshore assets are predicted to rise by more than 400%.
As much new wealth is being created in Asia, as opposed to the lower growth rates in the West, these wealth creators are being attracted to welcoming Singapore and shunning the progressively hostile tax environments of the West.
At the heart of the changes that are taking place in the global financial sphere countries, especially in the West, have to adapt to the rapidly transforming environment where intense competition from newer international financial centers, who are vying for the top spot.