THE number of millionaires globally will grow by 40% in the next five years, even as rising rates and Russia’s war in Ukraine are sinking asset classes and private fortunes this year.
By 2026, there will be more than 87.5 million people with at least $1 million in wealth, up from 62.5 million in 2021, according to Credit Suisse Group AG’s Global Wealth Report 2022 released on Tuesday. The number will grow faster in emerging economies, with China almost doubling its millionaire population, the forecasts show.
While the 500 richest people in the world have lost $1.4 trillion in cumulative fortune in the first half of the year, Credit Suisse sees a fast recovery, especially for developing markets. The Swiss bank expects China to keep creating massive wealth even as its economy is showing signs of strain amid Covid lockdowns and crackdowns in sectors including tech and property.
“Despite the inflation and Russia-Ukraine war setbacks, we believe that total global wealth will continue to grow,” the report said. “We expect household wealth in China to continue to catch up with the United States, advancing the equivalent of 14 US years between 2021 and 2026.”
Credit Suisse forecasts private fortunes will rise 36% to $169 trillion by 2026, with wealth per adult climbing 28% globally and surpassing $100,000 in 2024. The number of ultra-high net-worth individuals – those with more than $50 million – will reach 385,000.
Developing markets were hit badly during the Covid-19 pandemic, and wealth growth slowed. But they regained momentum last year and Credit Suisse expects them to narrow the gap with the developed world in the next five years. Fortunes will climb 10% annually in emerging economies, compared with a 4.2% rise in high-income nations.
In 2021, global fortunes surged by 9.8% to $463.6 trillion from 2020, posting a much bigger increase than what had been recorded since the beginning of the century. The top 1% owned 46% of all household assets, while the richest 10% of adults had 82% of global wealth. The US had the highest number of ultra-high-net-worth individuals – more than 140,000 – followed by China, with 32,710.
“There has been a reduction in the difference between rich countries and less rich countries, in particular because low- and middle-income countries are growing at a faster rate,” Anthony Shorrocks, Credit Suisse economist and report author, said during a press conference. – Bloomberg / pic TMR File