Four GCC countries have been ranked in the top 10 worldwide list of millionaire households, reflecting the growth in private financial wealth in the MENA region which reached $4.5 trillion in 2011, a new study revealed.
The UAE, Qatar, Kuwait, and Bahrain ranked in Boston Consultancy Group’s top 10 millionaires list.
The report, entitled The Battle to Regain Strength: Global Wealth 2012 is BCG’s twelfth annual look at the global wealth-management industry and addresses the current size of the market, the state of offshore wealth, the performance levels of leading institutions, the emergence of alternative business models, and key trends that all players must adapt to.
According to the report, private financial wealth in Middle East and Africa grew to $4.5 trillion in 2011, up from $4.3 trillion in 2010, marking a 4.7% increase. Furthermore, it is expected to grow by a compound annual growth rate (CAGR) of 6.6% by 2016, to reach $6.1 trillion, largely as a result of continued strong GDP expansion in oil-rich countries.
“We see this growth despite the fact that Middle Eastern and African stock markets suffered from the political instability caused by the uprisings across the Arab world in 2011. Despite this, the region’s private wealth grew in 2011 driven by high savings rates and strong economic growth in commodity-rich countries such as Saudi Arabia and Qatar. The wealth held in bonds rose by 13.3%, and cash and deposits grew by 5.1% – only the amount of wealth held in equities decreased by 2.6%, mostly driven by weak market performance,” Dr.Sven-Olaf Vathje, Partner and Managing Director at BCG Middle East, said.
The BCG study also estimated that between 2011 and 2016, private financial wealth in the region will grow by a CAGR of 8% for households worth more than $100m, 8% for households worth between $1-$100m and 5% for households worth less than $1m.
“While Singapore led the list with 17 millionaire households per 100, Qatar stood at second place with 14.3 percent millionaire households; Kuwait came in third with 11.8 percent, and Bahrain stood at tenth place with 3.2 percent. The UAE ranked sixth, with 5 millionaire households per 100,” Markus Massi, Managing director and partner of BCG, said.
The study revealed that number of millionaires globally increased by 175,000 in 2011, reaching 12.6 million households. The United States 5.1 million out of those.
A Forbes Middle East list published in April announced 36 billionaires, with an accumulated wealth of more than $121bn, come from the Arab world.
Saudi Arabia’s Prince Alwaleed Bin Talal Al Saud topped the ranking with an estimated fortune of $18bn, followed by Lebanese-Brazilian billionaire Joseph Safra with $13.8bn to his name.
The BCG study counted millionaire households as those with over $1 million in cash, stock, and other assets, but excluded property, business, and luxury goods.