Why You Need To Offshore
March 31, 2016
Nowadays no one can be sure financial crisis won’t set in the nearest several years, it happens every here and there and stock markets crash as well. In the end of summer 2015, for instance, the Chinese stock market almost collapsed causing great pressure in the financial world. In just a several days the stock market lost over 20% in value and it entailed the negative reaction of the global market as well.
Actually, the details of the rapid decline are quite messy. As soon as the stockholders grew excessively speculative as to the Chinese stocks value, an asset bubble was formed. At the same time, the country’s government tried to react and keep the markets upheld with such policies, as low-interest rates and reduced capitalization norms for banks.
Anyway, for anybody familiar with the mechanism of how the market works the situation was quite predictable. The bubble increased until finally burst and crashed the stock prices first in China and then all over the world. So, what was this entire foreword for? All the said above was aimed to demonstrate why every fiscal manager and entrepreneur should consider offshore incorporation.
The crisis emerging in China and having spread later worldwide has shown that everyone is at risk of downturns, no matter where he lives. It’s important not to put all eggs in one basket and it’s vital to diversify your wealth. Opening offshore company is a perfect way to this. Incorporating an overseas foundation, you can protect your wealth from the market disorder.
At present, the fiscal markets grow intertwined and the risk of worldwide downturns increases. It’s important to realize that the collapse of the financial system will not only influence your stock portfolio but a number of other things. The 2007 housing bubble burst in the United States, for instance, gave a start to the Eurozone crisis, which in fact resulted in Greek bankruptcy. The government of the country had to implement tight capital control and prevented the citizens from accessing their bank accounts.
Smart Greeks, however, benefitted from the offshore companies and bank accounts set in advance, thus having access to their funds and wealth. No country can guarantee staying safe from the economic downturns and capital control measures in the nearest years. That’s why it’s important to diversify your wealth by means of offshoring.
The jurisdictions, specialized in an off shore operations are likely to be safe from the financial turbulence as they try to keep their economic systems separate from the world. Hong Kong, for example, has a separate currency and is entirely isolated from the mainland China from the governmental point of view. Switzerland also has its own currency not relying on the EU. Offshore hubs have, as a rule, strong financial laws able to provide additional protection.
More than that the offshore structures can help you save on taxes, increase security and implement efficient and effective estate planning policies. There are a number of advantages in the offshoring, along with small setting up and maintenance company costs. Make sure you have taken all the available options into consideration!