Global wealth shifting to the East

Reading Time: 2 minutes
Rolls Royce’s recently opened first showroom in Kuala Lumpur shows the demand for luxury goods and the rise in spending power in the rapidly emerging economies in Southeast Asia

Southeast Asia, China, Japan, South Korea and Taiwan will be the world’s richest economies by 2050 and are already home of the largest number of multi-millionaires, as per-capita GDP is growing at a rapid speed and global wealth is shifting towards the East.

This is the outcome of a new study by Citibank Private Bank and global property consultant Knight Frank, The Wealth Report 2012. The study says that the number of high-net worth individuals – defined as people possessing more than $100 million in cash and assets, so-called centa-millionaires – in the region already outnumbers those in the US and Europe. East Asia currently accounts for around 18,000 centa-millionaires, while the US has 17,000 and Western Europe 14,000.

The increase in centa-millionaires in Southeast Asia alone has been 80 per cent in the period of 2006-2011, and is projected to further grow by 44 per cent to 26,000 high-net worth individuals by 2016, the study says, citing data compiled by UK-based market researcher Ledbury Research.

Furthermore, Southeast Asian deca-millionaires (those with $10 million or more in assets) already outnumber those in Europe and are expected to overtake those in the US in the coming decade.

In terms of GDP per capita, Singapore already topped the list in 2010 and is expected to keep the top spot in 2050, when the city-state”s GDP per capita would reach $137,710, the report says. It will be trailed by Hong Kong ($116,639), Taiwan ($114,093) and South Korea ($107,752), with the US coming in fifth place, down from third in 2010.

Developing Asia’s share in the world GDP is expected to rise from 27 per cent to 49 per cent in 2050. China will overtake the US to become the world’s largest economy by 2020, which in turn will be overtaken by India in 2050.

“While rapid GDP growth does not in itself guarantee a sharp rise in high net-worth individuals, rapidly growing economies do provide key opportunities for large-scale wealth creation,” Grainne Gikmore, head of UK Residential Research at Knight Frank, said.

Citibank’s research in the study shows that there are other key countries with promising chances for growth that do not necessarily match the traditional assumptions about where future growth will emanate from. For example, Russia and Brazil, which make up the so-called BRIC nations alongside China and India, do not make it on to Citi’s list of “global growth generators. Instead, Citi includes countries such as Bangladesh, Egypt, Indonesia, Iraq, Mongolia, Nigeria, Philippines, Sri Lanka and Vietnam on this list.

“All of these countries are poor today and have decades of catch-up growth to look forward to. Some of
them, including Nigeria, Mongolia, Iraq and Indonesia, also have large natural resources that we hope will be
more beneficial than they so often have been in the past,” says Citibank’s chief economist Willem Buiter.

Mexico, Turkey, Thailand and Iran are also countries to watch, he added.

Do you like this post?
  • Fascinated
  • Happy
  • Sad
  • Angry
  • Bored
  • Afraid

Reading Time: 2 minutes

Rolls Royce’s recently opened first showroom in Kuala Lumpur shows the demand for luxury goods and the rise in spending power in the rapidly emerging economies in Southeast Asia

Southeast Asia, China, Japan, South Korea and Taiwan will be the world’s richest economies by 2050 and are already home of the largest number of multi-millionaires, as per-capita GDP is growing at a rapid speed and global wealth is shifting towards the East.

Reading Time: 2 minutes

Rolls Royce’s recently opened first showroom in Kuala Lumpur shows the demand for luxury goods and the rise in spending power in the rapidly emerging economies in Southeast Asia

Southeast Asia, China, Japan, South Korea and Taiwan will be the world’s richest economies by 2050 and are already home of the largest number of multi-millionaires, as per-capita GDP is growing at a rapid speed and global wealth is shifting towards the East.

This is the outcome of a new study by Citibank Private Bank and global property consultant Knight Frank, The Wealth Report 2012. The study says that the number of high-net worth individuals – defined as people possessing more than $100 million in cash and assets, so-called centa-millionaires – in the region already outnumbers those in the US and Europe. East Asia currently accounts for around 18,000 centa-millionaires, while the US has 17,000 and Western Europe 14,000.

The increase in centa-millionaires in Southeast Asia alone has been 80 per cent in the period of 2006-2011, and is projected to further grow by 44 per cent to 26,000 high-net worth individuals by 2016, the study says, citing data compiled by UK-based market researcher Ledbury Research.

Furthermore, Southeast Asian deca-millionaires (those with $10 million or more in assets) already outnumber those in Europe and are expected to overtake those in the US in the coming decade.

In terms of GDP per capita, Singapore already topped the list in 2010 and is expected to keep the top spot in 2050, when the city-state”s GDP per capita would reach $137,710, the report says. It will be trailed by Hong Kong ($116,639), Taiwan ($114,093) and South Korea ($107,752), with the US coming in fifth place, down from third in 2010.

Developing Asia’s share in the world GDP is expected to rise from 27 per cent to 49 per cent in 2050. China will overtake the US to become the world’s largest economy by 2020, which in turn will be overtaken by India in 2050.

“While rapid GDP growth does not in itself guarantee a sharp rise in high net-worth individuals, rapidly growing economies do provide key opportunities for large-scale wealth creation,” Grainne Gikmore, head of UK Residential Research at Knight Frank, said.

Citibank’s research in the study shows that there are other key countries with promising chances for growth that do not necessarily match the traditional assumptions about where future growth will emanate from. For example, Russia and Brazil, which make up the so-called BRIC nations alongside China and India, do not make it on to Citi’s list of “global growth generators. Instead, Citi includes countries such as Bangladesh, Egypt, Indonesia, Iraq, Mongolia, Nigeria, Philippines, Sri Lanka and Vietnam on this list.

“All of these countries are poor today and have decades of catch-up growth to look forward to. Some of
them, including Nigeria, Mongolia, Iraq and Indonesia, also have large natural resources that we hope will be
more beneficial than they so often have been in the past,” says Citibank’s chief economist Willem Buiter.

Mexico, Turkey, Thailand and Iran are also countries to watch, he added.

Do you like this post?
  • Fascinated
  • Happy
  • Sad
  • Angry
  • Bored
  • Afraid