The amount of private wealth in the booming Asia-Pacific region excluding Japan will overtake Europe this year and the US in 2018, according to a new study by Boston Consulting Group (BCG).
Private financial wealth around the world increased 14.6 percent last year to US$152 trillion, helped by rebounding stock markets, with the Asia-Pacific region seeing a 30.5 percent jump, the BCG report said.
That translated into a the number of millionaire households around the world increasing by 2.6 million to 16.3 million. Close to half were in the US, but there was strong growth in private wealth in China, where 2.4 million households count as millionaires, while Japan’s number of richest continued to fall.
The BCG study, Riding a Wave of Growth: Global Wealth 2014, said the largest store of private financial wealth — cash, securities and bank deposits, but not including real estate or luxury goods — remains the US, and Western Europe is second.
However, by the end of this year, the Asia-Pacific region excluding Japan will top Europe, which could count US$37.9 trillion in private wealth at the end of last year, the report said. And by 2018, Asia will have US$61 trillion, more than the US$59.1 trillion projected for all of North America and US$44.6 trillion for Europe.
“As the debate over the global polarization of wealth rages on, one thing is certain: more people are becoming wealthy,” the study said.
The most dense population of millionaires was in Qatar (175 out of every 1,000 households), then Switzerland (127) and Singapore (100).
However, Hong Kong had the highest percentage of billionaire households, at 15.3 per million, with Switzerland second.
The shift of wealth from the economic “old world” to the “new world” follows economic growth and poses new challenges.
“The key challenge in developed economies is how to make the most of a large existing asset base amid volatile growth patterns,” said Brent Beardsley, coauthor of the BCG report.
“The task in the developing economies is to attract a sizable share of the new wealth being created there. Overall, the battle for assets and market share will become increasingly intense in the run-up to 2020,” he said.