Just four short years ago the global fiscal landscape was very different to that which we gaze upon today! Banks were apparently booming, they were still happy to lend, the pound was still relatively strong, and people’s dreams of owning investment property abroad and of retiring in style to the sun were apparently eminently achievable.
And then reality bit! Since then we have seen financial institutions reach the point of bankruptcy, we’ve witnessed governments print money in a desperate bid to save their economies, (a.k.a., quantitative easing), we’ve had economies downgraded, billion dollar bailouts of nations implemented…and for the average man and woman on the street it has meant a definite and negative personal fiscal adjustment in many cases.
However, in spite of this generally negative overview, there have been nations that have seemingly avoided the worst of the economic fallout, and which have been trading on their positive economic positions. Countries such as Australia, Canada and Turkey have become attractive expat destination considerations as a result…however, we would urge all would-be expats to learn from the recent global financial issues before moving anywhere overseas, as nowhere is immune from fiscal woes.
Turkey has been one of the most vociferous in terms of promoting its economic strength against an otherwise bleak world fiscal situation. Apparently per capita income has tripled since Prime Minister Recep Tayyip Erdogan came to power in 2002, and the nation’s economy grew by 8.9% in 2010 - which was the third highest rate of growth in the entire G20.
Turkey has also traded on its youthful population, its strengths as a manufacturing base and exporting giant, the fact it is working towards EU accession and as a result it’s concentrating on smoother and more sustainable financial development.
However, the Turkish currency and the national stock market have both fallen in 2011 by about 6% and it’s well known that the nation suffers with a very high current account deficit. Youth unemployment is riding at 20%, and as a nation which prides itself and heavily trades on its geographic and strategic position lying between east and west, Turkey has been impacted heavily by the recent and ongoing tensions and conflicts in the region in the likes of Syria and Libya for example.
All of these are very real concerns which could cause the economy to overheat, suffer, be negatively impacted and just generally fall in terms of its positive reputation. In other words, expats should not bank on Turkey being an economic rising start for the short, medium or long-term…they should instead tread carefully with a strong awareness of what could potentially happen in the country in the future.
Australia is another nation that can seemingly do no wrong economically speaking – the headlines tell of stabilisation on the one hand, with others taking it further and stating that the nation is an economic miracle. However, dig a little deeper and you will see that there is a strong lack of consumer interest because the country’s citizens are facing many of the same problems that Brits are facing.
High food costs and real estate prices as well as less job security and low interest rates impacting savings and investment income are real issues facing families Down Under. Therefore how much greener is the grass for expats emigrating to Australia?
What about Canada? Well, it looks good – for the time being. Short-term indicators show modest economic growth for the next two years. Although according to the Wall Street Journal: “Canada posted a nearly billion-dollar trade deficit in April, defying expectations of a surplus and suggesting that the country’s strong currency, coupled with weakening demand overseas, is hampering the key export sector… The data cast a darker cloud on Canada’s economic outlook, which has recently appeared as one of the Group of Seven’s brighter spots. In recent weeks, as U.S. economic data pointed to a weaker-than-expected recovery there and as Europe’s debt crisis ground on, Canadian officials have said they are more cautious about Canada’s export-oriented economy.”
Therefore even the economies built on the best fundamentals for at least short-term advancement are not immune to the rest of the world’s economic problems. Expats need to heed all of this information when they’re thinking about moving abroad.
Yes things are bad in Britain…but even the best economies in the world can and may very well be impacted financially speaking in the short or medium-term. As a result it does not pay to bank on another country’s strong fiscal outlook…it pays to bank on oneself and one’s forward planning only.
If you work hard at determining what your cost of living may be like, what your employment prospects will be like and what you can do to strengthen your position to the max, in theory you can live anywhere in the world and be as best protected as possible. Do not rely on a nation’s economic forecast as the only indicator you need to commit to a move abroad – indicators can be wrong and factors can very quickly change their direction.
Wed, October 12, 2011 at 10:25 AM
We lived in Hong Kong nearly 10 years ago and loved it, but when the job offer to return came up we were reluctant, our lives had changed, we had changed, we wanted different things in life, but the money was just too good and quite rightly that’s what everyone advised us. So return we did, the company paid for us to ship the whole contents of our house out, paid for business class airfares and even agreed to pay for our dog to fly out, my partner (for it is his work that we follow) started his job and loathed it from the start. The interview promises disappeared, his colleagues were harsh, the demands unrealistic, the job lasted just 3 months.
We then spent 3 months looking for new jobs (both of us) whilst trying to enjoy all the unexpected free time and of course keeping an eye on spending, our savings disappeared fast. He then got a job, it paid terribly, but it kept us afloat, now that too looks set to go and we have decided to quit our losses and return to the UK. This time if we want to keep our posessions we will have to pay for their return, we’ll have to pay for the dog to fly and we’re looking at the cheapest possible airfares back. So we’ll be returning with no savings and probably a large amount of debt.
I’ll not say there hasn’t been good times, the time both of us were off work together was actually very good for us, in spite of the nerves for the future. However overall it has beeen a almost a full year of stress and uncertainty, financally it will have crippled us and we both feel pretty worn out by the whole thing.