Should emigration, rather than immigration, be the real concern for aging rich societies in 2026? I’ve lost track of the anecdotal evidence of disaffected working-age contacts relocating from the UK or France to the United Arab Emirates or Switzerland for more predictable — read lower — taxes. The latest is Alan Howard, co-founder of Brevan Howard Asset Management LLP, now a Swiss resident. And the fight for talent is only getting tougher, with former British Prime Minister David Cameron recently warning of an exodus of talented Brits heading to Dubai and Abu Dhabi.
Cameron’s right to be concerned, and not just because of recent arrivals in the UAE like Revolut Ltd.’s boss Nikolay Storonsky. While the mega-rich are always flighty, this goes beyond the Monaco-or-bust crowd: A net 110,000 British people aged 16 to 34 emigrated in the year to March, according to Office for National Statistics estimates. It’s not clear where they’ve gone, but relocation requests point to Middle East magnetism. Push factors driving emigration, including strained public finances and a weak white-collar job market, are widening the appeal of pull factors such as low or no personal tax. Bankers and hedge funds like Man Group Plc or Oak Hill Advisors, once wedded to big financial centers, are flocking to the UAE, where $1.1 trillion of sovereign wealth is being deployed.
Real estate prices are another indicator of a great wealth migration to the UAE and other tax-friendly hubs like Milan: Knight Frank’s index of prime property in major global cities has registered a 140% increase in Dubai, a 78% increase in Miami and a 38% increase in Milan over the past five years. London and Paris have underperformed, meanwhile, as fiscal tightening and pensioner-first budgets make everywhere from Dubai to Switzerland more tempting for knowledge workers and wealthy families — as wealth advisers keep telling me. Germany is losing 210,000 skilled workers aged 20 to 40 every year. Given the top 10% of high earners account for 60% to 75% of income tax receipts in France and the UK, the exits will start to add up.
“The competition is going to be huge,” says Arturo Bris, professor of finance at Swiss business school IMD. The Middle East is investing heavily in infrastructure and is focusing on quality of life as a magnet for global talent in a more digital world, he says. That gives it a comparative advantage in a contest where bigger financial centers can still claim to offer the best quality schools and jobs.
What can the administrations of Keir Starmer or Emmanuel Macron do? Competing with zero taxation is hard, expensive and certainly not a vote-winner; the days of France rolling out the red carpet for City bankers appear to be over, judging by what hedge-fund managers hear in private from French presidential candidates on the campaign trail. Cynics might suggest simply waiting for a correction that brings competing cities like Dubai down to Earth. After all, real estate accounts for 8% of Dubai’s gross domestic product and its open economy is vulnerable to a geopolitical or economic crisis. But this doesn’t feel very strategic. It’s not just property-flippers making the move — Dubai’s financial hub now boasts more than 100 registered hedge funds. The UAE is also getting more credit for its ability to confront dodgy money flows, which remain a risk.
A better strategy would be to mix carrot and stick. Those older cities need to go back to their cost-benefit analyses and lean into their strengths. Dubai’s place in an annual Savills index of tech hubs has jumped to 20 from 43, but that’s still below Paris and London, respectively 15 and 3, driven by top universities, skilled graduates and the availability of venture capital (although the US is still top.) Deeper and more integrated European capital markets are going to be vital for keeping startups from fleeing to environs where they feel they can scale more freely. And tax policies and social spending could be tilted more toward helping the young than protecting pensioners. Exit levies, while unpopular, may also have to be part of the mix if things get worse.
The exodus from the UK and elsewhere is real; the efforts to stem it need to be equally genuine.
