More expats are staying longer in GCC states, even into semi-retirement

by Ray Clancy on September 28, 2015

An improvement in work life balance is encouraging more expats to stay longer in Gulf Cooperation Council (GCC) states, new research has found.

Western expats, of which 80% are from the UK, stay an average of 12.9 years, those from other Arab countries 16.9 years, and those from India some 18.1 years.

SaudiArabiaThe Middle East Asset Management Study 2015, from investment firm Invesco, also shows that low tax rates are the main reason for people from abroad staying longer and even staying on into semi-retirement.

According to Nick Tolchard, head of Invesco Middle East, one key conclusion from this data is that western expat mobility and transience is not as significant an issue for the independent financial industry as many had thought.

He pointed out that low tax rates are attractive not just for British expats but also those from countries such as Singapore, which also attract large numbers of foreign professionals in the finance industry.

The research also found that work life balance was another factor citied in the study as one that keeps people in the region once they have settled there and security is important for Arab expats.

The survey suggests that there is now a well-established semi-retired expat community with expats who have been in the region for over 20 years. The report suggests that there is a strong underlying demand from expats to retire in the region despite the legal challenges that might entail.

It also suggests that if countries in the GCC region did more to make citizenship and retirement easier for foreign nationals, more would do so.

“There was a strong consensus that the number of GCC-based retirees would increase from all expatriate segments if GCC governments changed the immigration rules and encouraged retirees,” the report says.

The research also found that job losses are the most frequently cited factor for leaving the region and retirement is the third most common factor. “This means that two of the top three responses are push factors outside an expat’s control,” the report says.

Caring for parents and having children are the other important drivers. However, many respondents noted that the quality of schools in the GCC was improving so challenges with education were reducing. In fact many GCC advisers pointed out that saving for education as a key financial planning need that the industry should focus on.

The report also explained that expat children who complete secondary education locally have a strong long term affinity with the region and are increasingly likely to return to the GCC after completing university education abroad.

“The ongoing improvement in education in the GCC is a key factor influencing the evolution of expat length of stay,” the report added.

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