There are some countries that names of which would surprise many when it comes to creation of new millionaires. Even though economic powerhouses like the United States, China and Japan possess the largest proportion of the world’s wealthy, the rates of new millionaire minting is greater elsewhere.
This was the conclusion of the latest report from wealth research firm Wealth-X. The report found that select emerging nations across Africa, Asia and Europe are the ones that are on track for the fastest growth in their wealthy populations.
Research from more than 540,000 high net worth individuals formed the basis of the study that is a part of Wealth-X’s inaugural “High Net Worth Handbook 2019”. High net worth individuals are those who have a net worth of $1 million to $30 million. This data was used to estimate the outlook on global wealth growth in the next five years. Current wealth levels, population growth estimates and anticipated future investment opportunities were taken into account while preparing the report. .
The rate of growth of high net worth population would be 16.3 per cent between 2018 and 2023 in the West African nation of Nigeria which also leads the list. The second and third placed countries would be Egypt at 12.5 percent and Bangladesh at 11.4 percent.
There would be greater relative growth in the countries that are less developed and have a lower initial base line or wealth and this is a common trend in the forecast according to the report.
The same rates of growth in wealth as in the countries mentioned above would not be possible for countries like the US and China which already have 8.7 million and 1.9 million of millionaire population respectively. However the report predicts that China will record good growth in millionaires and consequently wealth.
There are however some interesting outliers in the report.
For example, “surprising cases” in the report are Poland and Kenya since these two countries are not considered to be part of the traditional groupings of top emerging countries which have been familiarized by terms such as BRICS (Brazil, Russia, India, China and South Africa) and MINT (Mexico, Indonesia, Nigeria and Turkey).
“The top ten countries with the fast growing HNW (high net worth) populations are a motley group,” the report noted. “With a growth measure we would expect to see some less affluent countries with small HNW populations but Poland and Kenya are two surprising cases.”
There are also differences in the source from where each of the countries derives their wealth growth. Energy exports can be the source of the growth of wealth of countries that are rich in supplies of commodity like Nigeria and Egypt. The report noted that rapid urbanization and increased infrastructure investment is the source of the wealth growth in Bangladesh – which has seen the fastest growth in the number of ultra wealthy population (those with a net worth of more than $30 million) in the last five years.
And greater structural investment is likely to impact countries like Vietnam, India, the Philippines and Kenya. On the other hand, a boon in their tech sectors is the cource of the wealth increase in countries like Ukraine and Poland.
(Adapted from CNBC.com)