Millionaires are packing for Namibia: The ‘Australia of Africa’ – Andrew Amoils

In Namibia, there are only three people per square kilometre, the top income tax rate is 37%, citizens pay no capital gains tax, and there is no estate duty to be paid. Added to this low population density and tax regime are abundant natural resources and low crime rates, which is why our neighbouring country in the desert is being tipped to be the next hot spot for dollar millionaires by wealth analysts at New World Wealth (NWW). In an interview with BizNews, Head of Research at NWW, Andrew Amoils said that Namibia shares many traits with Australia and could be described as the Australia of Africa. He says it is becoming a popular retirement destination, especially in parts of Windhoek and the areas between Swakopmund and Walvis Bay, where lifestyle estates are on the rise. If South Africa was safe and followed Namibia’s capital gains tax and estate duty policies, he said, it would be one of the wealthiest countries in the world in a decade. – Linda van Tilburg

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Relevant timestamps from the interview

  • 00:09 – Introductions
  • 00:35 – Andrew Amoils on why Namibia has become a millionaire hotspot
  • 02:53 – On if people go to retire there or to buy a second home there
  • 04:56 – Dollar millionaires
  • 06:06 – On if people are worried about corruption given Namibia’s history
  • 07:33 – Namibian Currency
  • 08:32 – Where do the millionaires come from
  • 10:15 – Is there a golden visa or easy access
  • 11:14 – Namibia’s trajectory
  • 12:23 – The strongest grower at the moment
  • 13:57 – Whats the profile of someone who is looking for a low tax base
  • 16:19 – Conclusions

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Excerpts from the Interview

One of the safest countries in Africa

I think there’s a number of factors at play. Namibia has always been one of the safest countries in Africa, which has sometimes been overlooked, but it’s becoming increasingly important. It is probably the safest country on the continent although Mauritius is probably safer, but it’s an island. Another factor is that it is an increasingly popular retirement destination, especially in certain parts of Windhoek, Swakopmund and areas between Swakopmund and Walvis Bay. There are also a lot of top-end lifestyle estates under construction. The reason for it being a popular retirement destination is also linked to taxation. They’ve got no capital gains tax, no estate duty.

They’ve also got one of the lowest population densities in the world, which we feel is a major factor. If you look at a lot of the fastest-growing first-world countries in the world, like Australia, and Canada, they have low population densities, whereas the slow-growing ones like the UK, have high population densities. Namibia has one of the lowest population densities in the world, about three people per square kilometre, which is the same as Australia, whereas South Africa’s has about 60 people per square kilometre and places like India have over 500 people per square kilometre while the UK and Germany have over 200. So, we feel that’s a major advantage as they have more resources per capita and it is also linked to wealth because Namibia is the third-wealthiest country in Africa after Mauritius and South Africa on a per capita basis.

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Namibia’s Initiatives to Attract Visitors and Investors

The Namibian government is making it more and more attractive for people to move there.  They have just released a nomad visa for travellers. They are trying to encourage people to go there. The ecotourism sector has taken off in Namibia over the last 15 years or so. Before, places like Botswana and Zimbabwe were much more popular than Namibia, whereas now Namibia is catching up. That is also driving a lot of foreign exchange income. Then you have all the minerals, like uranium deposits and diamonds, which have always been a big driver.  There is also a big emergence of green technology and possibly green hydrogen in Namibia, which could drive growth going forward. So, there are a lot of factors, but I think one of the things that’s often overlooked is that a lot of countries in Africa don’t have well-established luxury residential areas, whereas Namibia does. It has some top-end areas in parts of Windhoek and  Swakopmund and some top-end lifestyle estates that have been constructed. Many of them are wildlife and lifestyle estates. So, it has an advantage over a lot of other countries in Africa. South Africa has got that same advantage and Morocco and Kenya also have well-established luxury residential areas. But, if you go to many other countries in Africa, they don’t have that. So that’s also a factor.

Growth from 2,000 HNWIs to 10,000; strong forecast for Zambia, Rwanda and Morocco 

We’re expecting High Net Worth Individuals to go from just over 2,000 currently to around 10,000 by 2040. So, we’re expecting really strong growth, especially over the next few years. Once it gets well established, it should snowball. Of course, this depends on several factors, including the political situation.

We have very strong forecasts for Namibia, as we do for countries like Zambia and Mauritius, Morocco, and Rwanda, we’re expecting them to continue to grow strongly. There’s only a handful, four or five African countries that we expect to grow at the same rate as Namibia over the next 15, 20 years. 

Rwanda was the fastest grower over the last decade, but it did start from quite a low base. The wealth per capita in Rwanda is still quite low. I mean, there is always a lot of stuff about Rwanda in the media and how well it’s doing, but it’s always important to remember that they did have a civil war there and their wealth per capita went down to close to zero, so it was always going to be easy to get pretty strong growth after that. So, Rwanda has fewer high-net-worth individuals than Namibia, but it is growing at a faster rate.

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Mauritius will outperform all the other African countries

Going forward, over the next five years, we’d expect Mauritius to probably outperform all the other African countries, but Namibia could outperform Mauritius. We also expect really strong growth from Morocco, which is also becoming an increasingly popular retirement destination for wealthy people from Europe. It’s probably the only country in North Africa that’s doing well, as Egypt has struggled over the last decade.

Namibia, the Australia of Africa, SA will not mimic strong growth in HNWIs

If South Africa had been very safe and it had no capital gains tax and no estate duty in a decade it would probably have been one of the 20 wealthiest countries of the world. So, it would have been a no-brainer. Namibia is not as established as South Africa. It doesn’t have the benefits that South Africa has … it doesn’t have a big stock exchange, but the JSE has been bleeding market cap, so it’s going in the wrong direction. I seriously doubt South Africa would mimic Namibia’s in terms of the safety and the taxation profile. 

I think people overlook the low population density. People often mention Australia’s strict immigration policies, but they never really look at the fact that they’ve got such a low population density. They only have 25 million people. Their country’s bigger than India, which has almost 2 billion people.  I know some of it’s desert, but a lot of it isn’t and Namibia is similar to Australia in many ways. In a way, Namibia is the Australia of Africa. 

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