Taipei, Taiwan – Five years ago, Jin Ming traveled from her home in Shanghai to Hong Kong to buy herself something special for her birthday.

The wealthy 31-year-old owner of an import-export company wasn’t looking for a designer watch or handbag.

Instead, she came for critical illness insurance.

“I had no confidence in the ability of the Chinese healthcare system and insurance market to provide the care and insurance I might need later in my life,” Meng, who asked not to be referred to by her real name, told Al Jazeera.

“So, I decided to go and open a bank account in Hong Kong and get insurance there instead.”

Since then, as Meng’s wealth has grown, she has expanded her financial dealings outside mainland China.

Today, it runs a large portion of its business through Hong Kong, and has recently set up a bank account in Singapore to which it has moved many of its assets.

“I don’t want to have a lot of my money in China, because in many ways I feel like China is not in a good place right now,” she said.

The Chinese economy is facing some of the most difficult conditions it has experienced in decades.

Economic activity has slowed below the historical trend, raising doubts that Beijing will meet its target of roughly 5% growth in 2024. Youth unemployment is also high, hovering above 17%.

Household spending, at about 40 percent of GDP, remains well below the global average, and the real estate market remains in the grip of a long recession that has seen prices fall about 8 percent from their peak.

Meanwhile, sweeping crackdowns on a wide range of industries, from technology to finance and tutoring, have caused tension in the business world in recent years, as has the disappearance of prominent businessmen such as Bao Fan.

We haven’t heard from Bao, one of the most high-profile investment bankers in China’s tech scene, since February 2023, when his investment China Renaissance announced it was “cooperating” with the investigation.

The authorities did not provide any details about any allegations against him or the status of any case.

“With everything that’s happened, I don’t think it’s safe Depends on the Chinese market“Meng said.

“The situation is very unstable.”

After moving much of her money out of China, Meng has considered moving elsewhere one day, too.

“I definitely thought about leaving altogether,” she said.

“I’m just a small business owner, but I know that a lot of rich people with a lot of assets are thinking about leaving China as well.”

Many wealthy Chinese have already taken the plunge.

Last year, China saw 13,800 high-net-worth individuals leave the country, an increase of 28% from 2022, the most of any country, according to a report by investment migration firm Henley & Partners.

The company expects a record 15,200 Chinese millionaires to move in by the end of 2024.

The outflow does not constitute an exodus, as China was home to 6.2 millionaires as of 2021, according to a report by Credit Suisse and UBS.

“But if this is the beginning of an accelerating trend, it could represent an economic challenge for China,” Alan von Mehren, chief China analyst and economist at Danske Bank, told Al Jazeera.

When millionaires leave, they tend to take their wealth with them.

This capital flight has left a clear impact among foreign investors in China.

In the second quarter of this year, foreign companies withdrew a record $15 billion from China.

According to Sarah Hsu, an associate professor at the University of Tennessee who studies Chinese fintech and shadow banks, increased money outflows will only do more damage to the already existing Chinese economy. The faltering Chinese economy.

“So, they should be concerned about capital flight,” Hsu told Al Jazeera, referring to the Chinese government.

But Chinese authorities are already well aware of the problems that a mass exodus of wealthy Chinese could pose, according to von Mehren.

“This is partly why we’ve seen the Chinese government launch a charm offensive to try to reassure people in the private sector,” he said.

After years of crackdowns on the private sector, officials have recently taken a more business-friendly tone.

Chinese Premier Li Qiang proclaimed in January that the Chinese economy was open for business and pledged to “take active steps to address reasonable concerns of the global business community.”

In November, Qiang met with senior executives from some of China’s leading tech firms, raising hopes that the crackdown on the sector was ending.

“Since the crackdowns in the private sector, there has been a breakdown of trust between the central authorities and segments of the Chinese business community,” von Mehren said.

“If they can restore trust, they might be able to stem the flow of people seeking away from China.”

If words of reassurance fail to calm investors’ nerves, Chinese authorities can look to their strict capital controls to try to prevent individuals from transferring their assets out of the country.

Chinese nationals are only allowed to transfer the equivalent of $50,000 out of the country each year.

Banks and other financial institutions also have to report all domestic and overseas cash transactions of more than 50,000 yuan ($7,000) to the authorities, while cash deposits and withdrawals of a similar amount have to be registered.

Still, wealthy Chinese have found ways to skirt such controls.

It is not uncommon for wealthy individuals to use family members to move funds, according to Hsu, or to buy assets such as gold bars that can be moved abroad.

“But others are turning to underground money handlers,” Hsu said.

These handlers make up a vast global network that facilitates the transfer of funds around the world through a variety of channels.

One common method employed by Chinese shadow bankers, known as “smurfing”, involves recruiting people who have not used their annual $50,000 transfer limit.

In one case reported by Chinese state media, a man surnamed Li was accused by authorities of single-handedly overseeing a network of 102 individuals that facilitated the transfer of millions of dollars out of the country every year.

In December, Chinese authorities announced that they had dismantled more than 100 underground money-handling operations since May and traced illicit financial transactions totalling about $11bn.

“Underground money handlers are usually connected to criminal activities and are considered illegal finance in China,” Hsu said.

“It is very risky to use them, especially during a serious government crackdown, but they are functional and can move large amounts of money out of the country.”

For those who successfully move their assets abroad, Singapore is among the most popular options.

Rich Chinese have set up hundreds of wealth management offices in the city-state in recent years and represent the largest group of foreign buyers of luxury homes in 2022.

flow, as well as the latter Money laundering scandalThis has led to increased scrutiny of incoming Chinese wealth by Singaporean authorities.

The Monetary Authority of Singapore earlier this year rejected two applications from high-net-worth family offices affiliated with China, the Nikkei Asia reported in March, citing two sources familiar with the matter.

However, Singapore remains the top destination for China’s outgoing millionaires alongside Canada and the United States, according to Henley & Partners.

If Meng leaves China, there is little doubt in her mind about where she will go.

“I was living and studying in Singapore, so I will choose to settle there,” she said.

“It would be most convenient for me.”