Family Wealth in China
Paul Keogh
Chair Construct Innovate, A. Professor DCU Business School - Consultant Family Business, Sport, Lifestyle, Drinks, Construction & Retail, Founder Elder Lemons, Best Selling Author, INED- Innovate Kildare, DCUET, Investor
There are massive changes afoot in China. The country may have a "common prosperity" campaign to reduce the wealth gap but the gap is getting wider. The founders of some of China's biggest family businesses are sitting on almost $1.5 trillion of cumulative wealth that will be passed on to their heirs.
The top 100 or so richest Chinese billionaires are in their mid-fifties or older. The first generation of Chinese entrepreneurs are now at retirement age.
There is no inheritance tax in China.
The Chinese government is cracking down on industries such as real estate so families are looking for new ways of investing their money. This has initiated conversations around succession planning.
The vast majority of these rich families now have set up family offices, not just to manage their wealth but also to manage the transition from one generation to the next.
There are already over 400 family offices in Hong Kong and aims to have another 250 located there in the next two years through tax incentives. Much of this is in response to Singapore which already has 1,200 family offices registered for tax incentives. Singapore is already benefitting from the exodus of high-net-worth individuals from Hong Kong.
It is an exciting time for anyone involved in advising family businesses as the world's wealth shifts east.