How Are the Golden Geese Reacting to the Turmoil in the Middle East?
Friday, March 11th, 2011
Written by David S. Lesperance
Within the last month, I have seen a tremendous upswing in the number of individuals who are retaining me as a response to recent events in the Middle East and North Africa. They range from local nationals to Arab expats to International expats and they each have their own reasoning behind their desire to “have a back-up plan” for their families and their fortunes. In brief here is the reasoning:
1. Local Nationals: This group ranges from wealthy business owners to high income professionals. Even if they support greater democracy in their home country, they are frightened by the unrealistic expectations of the protestors that throwing out the existing regimes will instantly bring financial prosperity and employment. As one new client said, “Any country is just four missed meals away from revolution. My fear is that the protests have left many protesters on the brink of financial disaster. They expect instant prosperity after a regime change and when that does not happen and they get hungry they will start looting my neighborhood. The fact that I was in the square handing out food and water and also protesting for democracy will fall on deaf ears, as they attack my home and my family. Therefore, I am taking the prudent precaution of getting my family the right to live somewhere else and remove more and more of my assets out of my home country.”
2. Arab and Sub-Continent Expats: Groups such as Indians, Pakistanis, Palestinians, Lebanese and Iranians, who have lived in the Gulf States for decades, are worried not only about protesters, but also that some people in their host country may take advantage of the upheavals. In the six nation Gulf Cooperation Council (GCC), these individuals live year to year on annual residence permits. This is despite the fact that they or their children may have been born in the host country or spent the vast majority of their lives living there. Their “home country” is alien to them and it is not possible to have the business opportunity or lifestyle there that they have been enjoying in their host country. Recently, I was retained by one gentleman who did not have his annual residence permit renewed despite having lived in that particular country for over 45 years and having built up a prosperous business that employed several hundred people. He was told that he had one week to leave the country. When I asked him why his residence permit wasn’t renewed, he speculated “The officials would not give me a reason but I strongly suspect that a business person who owed my company a great deal of money used his extensive connections with ‘the powers that be’ to have me ‘go away’. The scoundrel did give himself away by already being at my office when I returned from the immigration office with an offer to buy my company at a deep discount (including a forgiveness of his indebtedness).”
3. International Expats: Wealthy foreigners and highly paid executives were enticed to buy property in many gulf countries with an implied or even explicit promise of automatic permanent residence. When this promise was not fulfilled and the property market turned sour, they quickly discovered that they had few rights relating to the property and that debt default was actually a criminal offence. When this reality is combined with the economic turmoil of current or anticipated protests and disruptions, the decision to leave their new Middle East home has become a surety. However, many are reluctant to return to their high tax home country. As a result, they have retained my firm to help them locate the next oasis which balances lifestyle, business opportunity, security and reasonable taxation.
It goes without saying that these “Golden Geese” are critical to any future economic stability or recovery in the region. The “unexpected outcome” of them securing and possibly executing a “back-up plan” in response to the current pro-democracy movement definitely merits attention.
