Russian Oligarchs on the Move Seek Refuge Abroad Amid Ukraine’s Crisis and Sanctions.
Russian oligarchs are in the midst of a massive relocation effort, both for themselves and their wealth, in an attempt to evade the war in Ukraine and the international sanctions directed at them. This shift in strategy has raised questions about the effectiveness of international efforts to pressure Russian President Vladimir Putin.
The Exodus of Russian Oligarchs on the Move
Even before the outbreak of war in Eastern Europe, some Russian billionaires had relocated to Western Europe. However, as the conflict escalated, their escape routes were cut off, and their assets came under attack. This situation has triggered a widespread exodus of affluent Russian businessmen from their home country.
Impact on Millionaire Populations
Due to President Putin’s handling of domestic and foreign affairs, Russia is projected to lose 15% of its millionaires in 2022. Meanwhile, Ukraine is expected to experience a staggering 42% reduction in its millionaire population. This has led to a surge in the migration of the super-rich to countries in the Middle East and Central Asia, with Dubai emerging as the preferred destination for Russian oligarchs.
Dubai’s Appeal as a Safe Haven
Dubai has transformed into a sanctuary for Russian oligarchs seeking to escape foreign sanctions. The city has witnessed a notable influx of millionaires from Russia, who can continue their business dealings with international corporations and securely store their assets in the United Arab Emirates.
Turkey: A Haven for Russian Oligarch Yachts
Turkey has also become a favored destination, particularly for Russian oligarch-owned yachts. Its proximity to Russia, reluctance to impose sanctions, and enticing citizenship-by-investment programme have made it an attractive option for wealthy yacht owners.
Shift to Former Soviet Countries and Beyond
Wealthy Russians are exploring alternatives in former Soviet nations like Azerbaijan and Kazakhstan, drawn by proximity, cultural similarities, and promising business prospects. Simultaneously, middle- and lower-class Russians are making their way to countries such as Armenia, Georgia, Turkey, Germany, and Latvia, where they can enjoy more affordable living costs and job opportunities. This trend has intensified competition in these job markets and raised tensions.
Challenges for Israel
Israel is grappling with the challenges posed by an increasing influx of Russian nationals seeking refuge from sanctions. These newcomers are benefiting from tax exemptions, but their presence has triggered suspicion among Israel’s allies and warnings from the United States.
Israel’s Potential Response
Considering Russia’s military presence in Syria and its involvement in the Ukraine conflict, Israel may need to reevaluate its relationship with Russian oligarchs. Taking a more assertive stance against the Kremlin could be essential. Furthermore, the exodus of oligarchs may offer economic advantages to other countries, while Russia’s heavy reliance on oil and gas exports makes its economy vulnerable to fluctuations in EU purchasing patterns.
