Private financial wealth in the Middle East and Africa (MEA) is poised to grow 35 per cent to $6.5 trillion by 2017 driven by new wealth creation linked to strong economic expansion, the Boston Consulting Group (BCG) said on Tuesday in a report that ranked the UAE as having the world’s ninth highest density of millionaires.
The consultancy firm ranked Qatar on top with the highest percentage of millionaires in ratio to the population. Out of Qatar’s two million population, 50,000 households (14.3 per cent of households) are millionaires. Second on the list is Switzerland followed by Kuwait, Hong Kong and Singapore.
Among millionaire households, the US has the most with 5.9 million. Japan is next on the list with 1.5 million, followed by China with 1.3 million, but BCG forecasts that they will switch places by 2017.
With 164,000 millionaire households, India ranks 15th in the world on the list of number of millionaire households. Private wealth in India is set to more than double to $4.5 trillion by 2017, from $2 trillion at the end of 2012.
BCG in its report titled ‘Maintaining Momentum in a Complex World: Global Wealth 2013,’ said that 40 out of every 1,000 households (four per cent) in the UAE held private wealth of at least $1 million.
The UAE also ranks fifteenth in the world by ultra-high-net-worth households, defined as households with more than $100 million in private wealth, with three out of 100,000 households falling into this category.
The report further said that private financial wealth in the MEA grew to $4.8 trillion in 2012, an increase of 9.1 per cent from $4.4 trillion in 2011. Wealth held in equities in the MEA region grew by 18.3 per cent in 2012, as compared to increases of 9.2 per cent in bonds and 5.2 per cent in cash and deposits.
“Qatar ranks first in the world with the highest density of millionaires, with 14.3 per cent holding private wealth of at least $1 million. Kuwait ranks third with 11.5 per cent, while Bahrain (4.9 per cent) and the UAE ranks seventh and ninth, respectively,” said Markus Massi, partner and managing director at BCG Middle East.
BCG said that the growth of private wealth in the region has been largely driven by a buoyant GCC equity market and an improvement in the global equity markets overall.
Additionally, the recovery of the local real estate markets has helped to free up additional liquidity for financial investments. Wealth held in equities saw strong growth in 2012, although individual markets in the GCC region posted sharply different results,” it said.
“The Dubai Financial Market Index enjoyed growth of 19.9 per cent and the Abu Dhabi Exchange improved by 9.5 per cent, while other GCC exchanges have seen moderate growth (six per cent for Tadawul) or as low as two per cent in the case of the Kuwait Stock Exchange (KSE),” Massi added.
A recent Wealth Report by Wealth-X, a wealth intelligence firm, said that the number of individuals worldwide with $30 million or more in net assets stood at 190,000.
