① Monaco, known as a wealthy country in Europe
Monaco is a city-state located on the southeastern coast of France in Western Europe. Monaco is classified as both Western and Southern Europe. It is the second smallest country in the world, following Vatican City. The area of Monaco is smaller than that of Yeouido in Seoul, with a population of only about 33,000. Despite its small size, it is famous as a representative wealthy European country.
Monaco has the highest distribution of the top 1% of wealth holders. One-third of the population is known to be millionaires, meaning that 3 out of every 10 citizens are millionaires. The average wealth of a Monaco citizen is about $1.1 million. This place was also selected as the most challenging country to become a top 1% rich person.
According to the 2023 Asset Report by UK real estate information company Knight Frank, Monaco ranks first in wealth for the top 1%. To be in the top 1% of wealth, net assets must exceed $14 million. In second place, Switzerland, the figure was approximately $7.5 million, a significant difference from Monaco.
The number of wealthy people in Monaco is steadily increasing. Experts predict that the growth of millionaires will accelerate even further. With millionaires flocking in, Monaco’s financial industry accounts for 17% of the total, a very high proportion.
Many of the world’s wealthy own homes in Monaco, whose real estate is known as one of the most expensive in the world. Despite Monaco’s small area, real estate is costly because demand is high and supply is low. The average house price in Monaco is approximately $4.3 million.
As of 2015, the average price per square foot approached $9,000, 50% higher than the New York real estate market. According to the real estate brokerage firm ‘Monaco Estate,’ as of 2019, a one-bedroom in downtown Monte Carlo (1,044 square feet) reached 3.99 million euros (approximately $4.7 million). A two-bedroom with an ocean view of 1,076 square feet reaches 8.8 million euros (approximately $10.4 million).
② Why Millionaires from Around the World are Flocking Here
How was Monaco able to rise as a rich country in Europe? Monaco abolished income tax in 1869. The tax rate imposed on companies or individuals is also shallow. It does not levy transfer income tax, income tax, wealth tax, or local tax and does not collect inheritance tax or gift tax.
The world’s wealthy are flocking to Monaco in Europe for these reasons. Furthermore, this place is considered one of the tax havens for the rich. In 2019, Jim Ratcliffe, the chairman of the multinational chemical group Ineos and the French Ligue 1 Nice owner, migrated to Monaco. The British billionaire chose Monaco to avoid paying 4 billion pounds (approximately $5.5 billion) in taxes that could arise from the possibility of Brexit rejection. If he leaves for Monaco, the UK cannot levy taxes.
Stefano Pessina, chairman of the American pharmacy chain Walgreens Boots Alliance, and Russian billionaire Dmitry Rybolovlev, who owns a soccer club in Monaco, are also known to be residents of Monaco. To become a resident of Monaco, you must invest at least 1 million euros. 500,000 euros must be deposited in a Monaco bank, and the remaining 500,000 euros must be invested in real estate.
As the rich flock here, global banks are opening new offices in Monaco, one after another. Citigroup and UBS Group, AG have entered Monaco. Monaco is becoming a central axis of personal asset management. Last year, the American investment bank Goldman Sachs opened a new office in Monaco. Goldman’s CEO David Solomon has added dozens of advisors to the company’s asset team at the headquarters. Companies from various countries are also establishing branches in Monaco.
③ Gaining Attention as a Resort Destination for the Rich
Monaco is attracting attention as a resort destination for the rich across Europe. Looking at the yachts moored, you can tell it’s a country of the rich. They host the world’s largest yacht show and the Formula One (F1) car racing event.
The Monaco F1 Grand Prix is held every May. It’s a time when many tourists worldwide flock to the city. The Monaco circuit has been hosting races since 1929 and ongoing since the first year of the F1 launch in 1950. With such a history, many celebrities and rich people come to watch the race.
Monaco holds the race by remodeling the streets of downtown Monte Carlo, which is also considered a unique feature of Monaco, instead of using a dedicated stadium. The 2023 Monaco Grand Prix, held this year, was the 78th competition.
By. Seo Sung Min
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