Global wealth at prevailing exchange rates jumped 9.8 per cent to $463.6 trillion in 2021 from the previous year, driven by gains in share prices and lower interest rates, according to Swiss bank Credit Suisse.
Setting aside exchange-rate movements, aggregate global wealth grew by 12.7 per cent in 2021, which is the fastest annual rate yet recorded, the bank said in its Global Wealth Report 2022, which analysed the household wealth of 5.3 billion people.
Accounting for inflation lowers the wealth growth rates, with the estimated increase in real wealth at 8.2 per cent last year, Credit Suisse said.
Wealth per adult rose 8.4 per cent to $87,489 last year, while the US added the most household wealth in 2021 at $19.5tn, followed by China ($11.2tn), Canada ($1.8tn), India ($1.5tn) and Australia ($1.4tn), according to the report.
“While some reversal of the exceptional wealth gains of 2021 is likely in 2022/2023 as several countries face slower growth or even recession, our five-year outlook is for wealth to continue growing,” said Nannette Hechler-Fayd’herbe, chief investment officer for the Europe, Middle East and Africa region and global head of economics and research at Credit Suisse.
“Our forecast is that, by 2024, global wealth per adult should pass the $100,000 threshold and that the number of millionaires will exceed 87 million individuals over the next five years.”
In 2020, the Covid-19 pandemic tipped the world economy into its worst recession since the Great Depression, forcing countries into lockdowns that led to higher unemployment and reduced salaries.
However, the generous financial support given to households by governments in many advanced countries and monetary support measures implemented by central banks, coupled with lower interest rates and limitations on consumption opportunities, boosted household wealth throughout the world.
A survey by jobs portal Bayt.com and market research company YouGov in November 2020 found that about 68 per cent of people in the UAE considered saving money as a top priority in 2021.
But factors such as the Russia-Ukraine war, inflation, rising interest rates and declining asset price trends could reverse last year’s growth in household wealth in 2022, the Credit Suisse report said.
Although all regions contributed to the rise in global wealth last year, North America and China dominated. North America accounted for more than half the global total of household wealth and China added another quarter.
In contrast, Africa, Europe, India and Latin America together accounted for about 11 per cent of global wealth growth because of widespread depreciation against the US dollar in these regions, the research found.
“Wealth losses were less common and almost always associated with currency depreciation against the US dollar,” said Anthony Shorrocks, economist and author of the Global Wealth Report 2022.
“Analysis of median wealth within countries and across the world shows that global wealth inequality has fallen this century due to faster growth achieved in emerging markets. The average household has thus been able to build up wealth over the last two decades.”
Total household wealth amounted to $2.1tn in Saudi Arabia and $1tn in the UAE last year, according to Credit Suisse.
However, because of Saudi Arabia’s higher population, wealth per adult in the UAE at $122,841 was 46 per cent higher than in Saudi Arabia at $84,407.
Net worth per adult in Saudi Arabia rose 7.1 per cent and 6.8 per cent in the UAE in 2021, the report said.
Meanwhile, the wealth share of the global top 1 per cent rose for a second year running to reach 45.6 per cent in 2021, up from 43.9 per cent in 2019.
US dollar millionaires gained 5.2 million members during 2021 and totalled 62.5 million worldwide in 2021.
The number of ultra-high-net-worth (UHNW) individuals (with wealth above $50 million) expanded at a much faster rate, adding 21 per cent new members in 2021, according to Credit Suisse.
The US continued to rank highest with more than 140,000 UHNW individuals, followed by China with 32,710 individuals. The US also gained the most UNHW members at 30,470, followed by China at 5,200 last year.
The number of millionaires will grow markedly over the next five years to 87 million, while the number of UHNWIs will reach 385,000, the report said.
“Global wealth in nominal US dollars is expected to increase by $169tn by 2026, a rise of 36 per cent,” according to Credit Suisse.
“Low and middle-income countries currently account for 24 per cent of wealth, but will be responsible for 42 per cent of wealth growth over the next five years. Middle-income countries will be the primary driver of global trends.”
Killing of Qassem Suleimani
The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
Tearful appearance
Chancellor Rachel Reeves set markets on edge as she appeared visibly distraught in parliament on Wednesday.
Legislative setbacks for the government have blown a new hole in the budgetary calculations at a time when the deficit is stubbornly large and the economy is struggling to grow.
She appeared with Keir Starmer on Thursday and the pair embraced, but he had failed to give her his backing as she cried a day earlier.
A spokesman said her upset demeanour was due to a personal matter.
Global state-owned investor ranking by size
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1.
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United States
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2.
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China
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3.
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UAE
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4.
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Japan
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5
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Norway
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6.
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Canada
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7.
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Singapore
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8.
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Australia
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9.
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Saudi Arabia
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10.
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South Korea
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Killing of Qassem Suleimani
Killing of Qassem Suleimani
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
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- 600-seat auditorium
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- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
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GAC GS8 Specs
Engine: 2.0-litre 4cyl turbo
Power: 248hp at 5,200rpm
Torque: 400Nm at 1,750-4,000rpm
Transmission: 8-speed auto
Fuel consumption: 9.1L/100km
On sale: Now
Price: From Dh149,900
Citizenship-by-investment programmes
United Kingdom
The UK offers three programmes for residency. The UK Overseas Business Representative Visa lets you open an overseas branch office of your existing company in the country at no extra investment. For the UK Tier 1 Innovator Visa, you are required to invest £50,000 (Dh238,000) into a business. You can also get a UK Tier 1 Investor Visa if you invest £2 million, £5m or £10m (the higher the investment, the sooner you obtain your permanent residency).
All UK residency visas get approved in 90 to 120 days and are valid for 3 years. After 3 years, the applicant can apply for extension of another 2 years. Once they have lived in the UK for a minimum of 6 months every year, they are eligible to apply for permanent residency (called Indefinite Leave to Remain). After one year of ILR, the applicant can apply for UK passport.
The Caribbean
Depending on the country, the investment amount starts from $100,000 (Dh367,250) and can go up to $400,000 in real estate. From the date of purchase, it will take between four to five months to receive a passport.
Portugal
The investment amount ranges from €350,000 to €500,000 (Dh1.5m to Dh2.16m) in real estate. From the date of purchase, it will take a maximum of six months to receive a Golden Visa. Applicants can apply for permanent residency after five years and Portuguese citizenship after six years.
“Among European countries with residency programmes, Portugal has been the most popular because it offers the most cost-effective programme to eventually acquire citizenship of the European Union without ever residing in Portugal,” states Veronica Cotdemiey of Citizenship Invest.
Greece
The real estate investment threshold to acquire residency for Greece is €250,000, making it the cheapest real estate residency visa scheme in Europe. You can apply for residency in four months and citizenship after seven years.
Spain
The real estate investment threshold to acquire residency for Spain is €500,000. You can apply for permanent residency after five years and citizenship after 10 years. It is not necessary to live in Spain to retain and renew the residency visa permit.
Cyprus
Cyprus offers the quickest route to citizenship of a European country in only six months. An investment of €2m in real estate is required, making it the highest priced programme in Europe.
Malta
The Malta citizenship by investment programme is lengthy and investors are required to contribute sums as donations to the Maltese government. The applicant must either contribute at least €650,000 to the National Development & Social Fund. Spouses and children are required to contribute €25,000; unmarried children between 18 and 25 and dependent parents must contribute €50,000 each.
The second step is to make an investment in property of at least €350,000 or enter a property rental contract for at least €16,000 per annum for five years. The third step is to invest at least €150,000 in bonds or shares approved by the Maltese government to be kept for at least five years.
Candidates must commit to a minimum physical presence in Malta before citizenship is granted. While you get residency in two months, you can apply for citizenship after a year.
Egypt
A one-year residency permit can be bought if you purchase property in Egypt worth $100,000. A three-year residency is available for those who invest $200,000 in property, and five years for those who purchase property worth $400,000.
Source: Citizenship Invest and Aqua Properties
