“Regardless of whether we’ll see global GDP growth exceeding 3% in 2020, investors should be prepared for volatility due to flashpoints in The Middle East and Asia, as well as Brexit and the US/ China Trade War”. (Luigi Wewege, SVP and Head of Private Banking, Caye International Bank, Belize)
As many big investment banks released their updated outlook for 2020/2021,we spoke to Luigi Wewege, SVP and Head of Private Banking at Caye International Bank headquartered in Belize to gather his views on things that matter to investors. We also wanted to understand the latest factors affecting private banking offshore, on which he kindly responded.
Caye International Bank honored with the Best Private Bank in Belize Award for 2020
What is your advice to investors in 2020, based on your outlook?
“Giving broad-level advice to individuals globally who all face different personal circumstances would be like a one-size-fits-all approach - and we at Caye International Bank, believe very much in a tailored individual approach. I will mention that our view is obviously consistent with that of many analysts, which is that tensions in Asia and the Middle East, together with banking reform in Europe and the potential fallout of Brexit and a US/China trade war requires a unique approach to risk and diversification. I am not suggesting that the whole world runs to gold as an immediate safe haven, although you should keep an eye on gold prices and keep in mind that the world is facing unprecedented challenges, which always means volatility, higher risk but more opportunity. On the other hand, if these issues are resolved swiftly, the global outlook may improve overnight on strong fundamentals”.
“Possibly yes. But it is normal, people do these things to be safe - for example, becoming jittery about Hong Kong should not necessarily imply exiting Asian equities completely: What about Japan and Indonesia, which are largely turning into success stories? Also, Asia, like Africa and Latin America are huge continents where one should not over-simplify or generalize”.
“Well, liquidity is a consideration yes. From our perspective, in Belize, investors allocate their funds in so many lucrative ways, but let’s say that you are concerned about your investments in other countries, then you should at least have a portion of money available in cash to cover you whenever it is needed. Off course an offshore bank account in Belize can be used to store some cash, which can also yield a higher interest rate than the United States, Europe or Australia.
Does it matter in which country people keep their money?
“Interesting question: Look, if we take a bearish view on the world and we keep in mind that already $5 billion in investment money flowed out of Hong Kong due to local tensions - well, it is fair to say at least a good portion of your savings ought to be in an offshore jurisdiction where your money is safe and can be accessed quickly. People have not forgotten the “haircuts” that account holders received in Cyprus, capital controls in Greece - and other challenges that played out in Europe, let alone the fact that Switzerland had to give up many of the features that used to be special about having a Swiss offshore bank account. So, pivoting away from Switzerland and Hong Kong is understandable. At the same time, whether people are concerned about how Europe treats their money - or even personal circumstances such as a looming divorce or other liability lurking around the corner, clearly locations like Belize becomes more desirable for offshore banking”.
"Well they don’t actually need to visit Belize in person to open an account, but to answer your question: It is true that investors see 2020 and 2021 as less stable due to geopolitical developments and for this reason they appreciate the unique opportunity that a jurisdiction like Belize offers. They understand that a balanced portfolio is important and even though many keep their main accounts in their countries of residence, we see many secondary accounts being opened in Belize: it is clear that people no longer want to keep all their eggs in one basket. Off course people come to Caye International Bank in Belize as we live up to our promise of providing: Privacy, Stability, Trust and Ease - which are essential pillars of a sound offshore banking opportunity”.
“Well, we’re in the business of helping investors to shelter their hard-earned money. I know that right now with the Australian housing market deflating and with Brexit harming UK house prices - and then Americans fearing that property prices may have peaked, there are many questions. From our perspective, we’re here for investors who want a smart asset allocation to protect them. All I will say about bubblenomics - is that people should avoid being over-exposed to an asset class that cannot be sold swiftly”.
“Well most self-made investors already know what Warren Buffet says about greed and fear, plus what he thinks about gold and equities, also they follow Jim Rogers and Marc Faber who provide views on alternative plays too. I will limit my commentary today and say that we’re very happy to help our friends from around the world to use Belize as a zero-tax platform from where they can access the global markets safely and certainly with unrivalled banking privacy and asset protection. Thank you and happy 2020”.
To follow regular commentary by Luigi Wewege, view his authored articles on Caye International Bank’s insights page.