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06
News
Gold investing
‘summer sale’ begins
The world’s richest expats
British investors looking to defend
their savings might want to act
live in Russia
sooner rather than later, says new
research from gold-trading and
If you want to make money in a
ownership service
foreign country, the place to go is
BullionVault.com.
Russia. A new survey has found
The company predicts there are
that the country is home to the
potential gains of 13.7% by the end
“wealthiest expats in the world.”
of the year if the purchase of gold is
A third of all expats in Russia —
made now. the highest proportion in the
Over the last four decades, the world — earn more than $250,000
gold price in sterling dipped in 20 per year. Almost half reported an
out of 39 summers, before rising in income of $200,000 per year or
autumn and winter to end the year
more, according to the survey
higher.
commissioned by HSBC Bank
Thirteen of these ‘summer sales’
International.
came during long-term bull runs,
The survey, released in late June,
such as the period enjoyed by UK
investigated the financial
gold buyers during the 1970s period
circumstances of 3,100 expats
of inflation, and again during this
decade.
living in 26 different countries.
enough to be able to employ at habits. Nevertheless, a large
On the 20 occasions since 1969
Rankings were based on a series of
least one person as domestic staff. majority — 83% — said they had
when gold dipped in the summer
interrelated factors, items such as
This is substantially higher than no intention of returning home.
before rising by the end of the year,
annual income, disposable
the global average of 48%. Recruitment specialists said the
the average gain for UK investors
income, savings and expenditure
When comparing their lives in numbers came as no surprise, even
buying in the lowest month between
on luxuries.
Russia with their lifestyles back with a financial crisis that has seen
June and September was 13.7% by
By any standard — and
home, 97% say they currently have both top executives and rank-and-
Christmas.
especially given the global
more disposable income. The filers take substantial pay cuts.
BullionVault Head of Research
financial crisis — Russia's expats
same proportion said they were “There is a massive lack of
Adrian Ash comments: “The live well, the survey established. saving and investing more money competition here in Russia in
summer sale 2009 now offers the Almost 60% of respondents say
than they did when they lived in nearly every sector,” said Luc Jones,
steepest discount in gold prices they have $4,000 or more every
their home country. a partner at the Antal recruiting
since 1992. There’s no guarantee the month in disposable income. This
Almost three-quarters, however, agency. “Back home, it's much
typical rally will follow, of course.
is the second-highest proportion
of expats in Russia said the global harder to differentiate yourself,
But from the all-time record peak of
in the world. Seventy percent earn
crisis had affected their spending while here you can stand out.”
£700 an ounce hit in February, gold
prices for UK investors have been
cut by 18%.”
Adrian Ash continued: “Such
‘summer sales’ in gold can be
Latin America targets UK property
attributed to a variety of factors,
such as weak jewellery demand values and the weakness of undertaken - such as property
from Asian and Indian consumers; sterling. A group of Latin dealing or development - it is
the stock-market adage to ‘Sell in
American investors from Brazil, necessary to use a treaty
May and come back on St. Ledger's
Argentina and Mexico are jurisdiction to override domestic
Day’ in October may also depress
currently engaged on an inbound taxing provisions.
gold prices; and because economic
UK development and One option combines non-
and financial news typically slows
infrastructure project. Most Latin blacklisted personal holding
over the summer. Buying a summer
American countries have adopted structures for each investor
dip failed to pay off in 2000 and
again between 2004 and 2006. But
strict anti-tax haven provisions feeding into a Barbados holding
with concerns about inflation fast
commonly referred to as company owning a Dutch
gaining ground, this summer’s
‘blacklists’ that essentially preclude property dealing company.
current lull could prove a great
the use of traditional offshore Barbados is a very useful ‘linking’
moment to buy if the most typical
centres such as the Cayman jurisdiction in this type of
shape for sterling gold prices comes
Islands, the Channel Islands and situation as it has treaties with
good once more.”
so on. Mexico and Brazil as well as the
Since Gordon Brown sold half
For UK property investment it Netherlands, allowing tax efficient
the nation’s reserves at rock-bottom
is common to employ some form repatriation through to the
prices in 1999, the sharpest gains for
The UK property market has been
of basic offshore arrangement as a beneficial owners. The group from
UK investors have come over the six
‘on pause’ for some time but there
non-resident is not liable to UK Latin America chose the
months from September to
are signs of recovery. For inbound
tax on real estate gains - a highly Netherlands because of its wide
February on average, rising by well
investors at least the UK is looking
unusual feature of the UK tax treaty network and treatment of
over 14% for UK investors.
attractive due to depressed land
code. However, where a trade is income from foreign real estate.
July/August 2009 Investment International www.investmentinternational.com
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