From IFC, we were amazed by the following:
“China has surged into second place for the country with the most millionaires propelling Asia towards becoming the wealthiest continent in the world, reports Yahoo News.
North America (at US$50.3 trillion) and Western Europe (US$37.9 trillion) have maintained their stronghold as the wealthiest regions in the world but Asia-Pacific (excluding Japan) is closing in at US$37.0 trillion.
A new report released by Boston Consulting Group (BCG) shows that private wealth in the Asia-Pacific region (excluding Japan) jumped 31 per cent to US$37 trillion in 2013, representing the fastest-growing region worldwide.
Private wealth on a global scale has also peaked, reaching a staggering US$152 trillion. This amount jumped by US$19.3 trillion in 2013, nearly twice the increase of US$10.7 trillion seen in 2012.
BCG says a key factor in the strong global growth of private wealth is the creation of new wealth in rapidly developing economies such as China. “The mature economies of the ‘old world’ and the rapidly developing economies of the ‘new world’ continued to move at different speeds,” BCG said.
The number of millionaires around the world has also increased, with the total number of millionaire households reaching 16.3 million in 2013 – a strong rise from 13.7 million in 2012.
BCG classifies a millionaire household as those with US$1 million in total liquid wealth, including stocks, cash and other financial investments but not real estate, collectibles or luxury items.
The US continues to reign in this department, laying claim to the highest number of millionaire households (7.1 million), the highest number of new millionaires (1.1 million) and, let’s not forget, the most billionaires.
But China may be hot on their heels, with now more millionaires than its East-Asian rival Japan. China saw a speedy rise in millionaire households from 1.5 million in 2012 to 2.4 million in 2013 with the wealthiest Chinese reaping huge returns from shadow-banking-related financial products.
Australia comes in at number 14, trailing behind Netherlands, Russia and Hong Kong, as its private wealth grew by double digits.
The highest density of millionaire households was in Qatar (175 out of every 1,000 households), followed by Switzerland (127) and Singapore (100).
BCG expects rich households to have almost US$200 trillion worldwide by 2018, with the Asia-Pacific region contributing about half of global growth.
Last year, private wealth booked across borders reaching US$8.9 trillion in 2013 with Switzerland the dominant offshore banking centre with US$2.3 trillion in assets. It is however under significant pressure with assets from Asian millionaires helping Hong Kong and Singapore to encroach on Switzerland’s world No.1 position in offshore private-banking.
Alongside China’s soaring growth, India is one to keep an eye on with BCG suggesting the country may more than double private wealth assets to US$5 trillion by 2018.
BCG’s report also indicates that the rate of growth in Latin American wealth has barely changed compared with a year earlier after an increase of 11 per cent to US$3.9 trillion. It’s expected to climb only 8.8 per cent a year until 2018, compared with an 11 per cent annual increase in the Asia-Pacific region.
At a business lunch in New York, Prime Minister Tony Abbott argued that the projected dominance of China’s economy and its region was not a threat to the United States. “A rich China doesn’t mean a billion competitors so much as a billion new customers,” Mr Abbott said. “Asia needs America involved. Asia needs America to succeed.””
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