Although most strikes have been intercepted before they could do real damage to Dubai and other parts of the United Arab Emirates (UAE), many footloose foreign residents have already scattered. A few nabbed seats on the last flights out to America or Europe. Others drove to Muscat, in neighbouring Oman, in search of alternative escape routes. Many hoped to return once the hostilities ceased. As these drag on, however, plenty are looking for a new, more peaceful bolt-hole. Where are they headed? And will they ever return? The UAE does not disclose detailed statistics on foreign residents but estimates suggest that, before the war, perhaps 3m-4m of the country’s 12m people were well-heeled outsiders and their families. More than 240,000 of them were millionaires. Dubai received the lion’s share of these arrivals. It now probably accounts for an outsize proportion of the departures. Dominic Volek of Henley & Partners, which advises the footloose affluent, reports that enquiries about other jurisdictions from UAE-based residents have risen by over 40% in recent weeks. More than 35 countries are now competing for the rich and enterprising, says Jean-François Harvey of Harvey Law Group, a firm of immigration lawyers. Long-standing destinations like New Zealand (“at the end of the world, mostly self-sufficient and outside a nuclear blast radius”, in the words of one consultant) and Malta have new competition. The Maldives is launching a permanent-residency-by-investment scheme this year. Argentina is also expected to offer deep-pocketed investors citizenship soon. On April 24th Turkey proposed a 20-year exemption to taxes on foreign income and capital gains for some foreigners. Since the war began about a dozen clients of Mr Harvey’s clients have acquired Turkish citizenship by buying a house there. Milan is particularly popular. “There is an increase in the movement of people out of Dubai,” says Roberto Bonomi, a tax lawyer in Milan at Withers, a British law firm. Diletta Giorgolo of Sotheby’s International Realty, a posh estate agent, says that interest in Italy from the Gulf has shot up in recent months, compared with a year earlier. What were initially mostly requests related to temporary rentals are increasingly connected “not only to short-term considerations, but also to longer-term lifestyle and investment planning”, she explains.
In contrast to sleepy rivals, Italy’s capital of both fashion and finance has networks to help those who want to enlarge their fortunes, rather than merely spend them. In recent years American hedge funds such as Millennium Management have set up shop in the city, allowing wealthy traders and fund managers to take advantage of Italian tax rules. High-earners there pay a relatively modest flat tax of €300,000 ($349,000) per year on their entire foreign income. Parents can now pick between American, British, Canadian, French and German international schools. The weather is tolerable, too. EU citizens can move to Milan at their leisure, which is why Dubai’s European transplants like it so much, says Mr Bonomi. For non-Europeans the most common way to secure residency is to invest €250,000 in an Italian startup or €500,000 in a more established firm. Alternatively, you can donate €1m to an Italian charity or park €2m in Italy’s government bonds. Another option is Singapore. The city-state had lost out to Dubai in recent years. Heavy-hitters from India and mainland China, in particular, were drawn by the emirate’s glitz, permissive rules and business opportunities. Singapore’s stricter social mores and the government’s obsession with a squeaky-clean image made it seem stuffy by comparison. That image now looks like a strength. So are Singapore’s efficient government, predictable legal system and excellent wealth managers. Big Singaporean banks, such as OCBC, report an uptick in net wealth inflows from Dubai. Singapore’s gold imports from the UAE have quadrupled since January. Ryan Lin of Bayfront Law, a firm in Singapore, says new client inquiries have leapt by a third in the past two months. His existing clientele, mostly newly rich Chinese people, are increasingly interested in leaving the Middle East. Rich Indians, 3,500 of whom leave the country each year with $1m or more in the bank, also seem keen to give Singapore another look. Mukesh Ambani, India’s richest man, opened a family office there in 2022. Places like Milan and Singapore are not perfect substitutes for Dubai. Russian plutocrats are frowned on in Italy, as in the rest of Europe, with Vladimir Putin waging war on Ukraine. Other wealthy foreigners may fear that next year’s elections could usher in a government that abolishes the flat-
tax regime. Even the current, friendly one raised the tax on foreign income from an initial €200,000 this year. Singapore, for its part, taxes income at 24% and charges foreigners an eye- watering surcharge on property sales. It has also tightened money-laundering rules in the wake of a $3bn scandal in 2023, and might be nervous about letting in a rush of dodgy money from Dubai. A law passed in 2024 lets the police prowl through tax and customs data. In recent years 80% of licence applications by crypto firms in Singapore were declined or withdrawn, according to the Financial Action Task Force, an anti-money-laundering watchdog. “Some investors liked the Emirates because they didn’t ask too many questions,” says a private banker in Singapore. Moving to the Asian metropolis might feel like it involves a “proctology exam”. “I think crypto wealth will stay in the Middle East,” reckons Mr Lin. So will some other sorts. Wealth managers, themselves a loaded bunch, need to be close to their clients, says one who expects his firm’s pinstriped legions to return to Dubai before long. Many foreign firms that allowed similarly well- off employees to “work from home”, meaning Milan or London, in the first months of the war expect them to get back to the office in Dubai. “Time is a great healer,” says another wealth manager. Perhaps. But the longer the wound of war remains open, the likelier expats are to be scarred by the experience. In the meantime, many will prefer to convalesce somewhere less hot. ■ For more expert analysis of the biggest stories in economics, finance and markets, sign up to Money Talks, our weekly subscriber-only newsletter. This article was downloaded by zlibrary from https://www.economist.com//finance-and-economics/2026/05/18/where-expat-escapees- from-dubai-end-up
Finance & economics | Buttonwood Investors fear another surge in inflation So why aren’t more buying inflation-protected bonds? May 21st 2026 Convulsing bond markets mean different things to different people. If you run a government, it is plainly bad that governments’ borrowing costs are shooting up—as they are across the world. The yield on Japan’s 30-year debt has risen above 4%, its highest ever; America’s has topped 5%; Britain’s is chugging fitfully towards 6%. Since mortgage rates tend to move in line with these yields, anyone looking for a new one will also feel the pinch. For bond traders, in contrast, the past few weeks have been quite the thrill. A decade ago near-zero interest rates seemed to have permanently shoved their market into the deep freeze. Now it is red hot. It is not hard to see why. Inflation and yawning government deficits have worried investors for years, and the Iran war is making both problems worse.
Bank of America conducts a monthly survey of global fund managers; in the latest, 40% of respondents said an inflationary wave was the biggest tail risk for markets. Despite this (or in explanation of it), 78% expected America’s Federal Reserve to either cut rates or leave them unchanged over the next year. They have acted accordingly, slashing holdings of cash and bonds, while raising their equity allocations by more than in any other month of the survey’s 25-year history. This is just what you might do if you think money is too loose. Given all this, it may seem puzzling that one market hasn’t moved more. Inflation-linked government bonds (“linkers”, or “TIPs” in America) offer the ultimate protection against investors’ fears: payments that are guaranteed to rise by the same amount as consumer prices. They therefore offer real yields, as opposed to the nominal ones on ordinary bonds, at which inflation nibbles away. The nominal yield minus the real one—for, say, ten-year American Treasuries—is widely thought of as the average inflation rate investors expect over the bonds’ remaining life. Fed officials might draw comfort from this ten-year “break-even”. At 2.5% it is roughly in line with their target and only a few tenths of a percentage point higher than it was at the start of this year. But that would be a mistake. The TIPs market is not subdued because investors are relaxed about inflation. Rather, it offers a cautionary tale about the limits of market efficiency—and therefore about using prices to forecast the future. As Exhibit A, consider how poorly TIPs-derived break-evens have sometimes performed at this in the past. During the panic that accompanied the first covid-19 lockdowns, in 2020, America’s ten-year break-even hit 0.5% and the two-year equivalent fell to -1%. In fact, barely a year later, the biggest inflationary surge in decades took off, and in 2022 the annual rate peaked above 9%. No trader has perfect foresight in the teeth of a crisis. Exhibit B, however, is that even one who did would struggle to act on it when it comes to inflation break-evens. Compared with the market for normal Treasuries, that for TIPs is small, illiquid and lacking in arbitrage opportunities. They account for just 7% of American government bonds and are favourites of pension schemes, which hold them in order to guarantee retirement payouts and so might not