MidEast's rich list grows despite global decline

Wealth of region's high net worth individuals rises to $1.7trn in 2011, says new report
MidEast's rich list grows despite global decline
By Andy Sambidge
Sat 23 Jun 2012 09:30 AM

The Middle East was the only region in the world where the wealth of high net worth individuals (HNWIs) grew last year, a new report has said.

The size of the HNWI population in the region gained by 2.7 percent in 2011 to 0.5 million, while wealth witnessed an increase by 0.7 percent to $1.7trn, according to the World Wealth Report 2012 by Capgemini and RBC Wealth Management.

The UAE witnessed a 3.7 percent drop in HNWI population due to the effects of the real estate crisis in Dubai and the impact of other factors such as the Eurozone crisis, the report said.

UAE market capitalisation decreased 9.6 percent in 2011, it added.

The report said the Middle East had 4,000 ultra-HNWIs in 2011 - people with $30m in investable assets or with a disposable income of more than $20m - making up 0.9 percent of the HNWI population.

Globally, the overall financial wealth of HNWIs declined by 1.7 percent - the first since the 2008 world economic crisis, a year in which HNWI global wealth declined by 19.5 percent.

The 16th annual World Wealth Report found that the number of HNWIs in Asia-Pacific expanded 1.6 percent to 3.37 million in 2011, making Asia-Pacific the largest HNWI region for the first time, surpassing North America’s HNWI population of 3.35 million.

After witnessing robust growth of 8.3 percent in 2010, global HNWI population grew marginally by 0.8 percent to 11.0 million in 2011.

Most of this growth could be attributed to HNWIs in the $1-5 million wealth band, which grew 1.1 percent and represented 90 percent of the global HNWI population.

In contrast, global HNWI wealth in 2011 fell by 1.7 percent to $42trn (compared with 9.7 percent growth to $42.7trn in 2010).

The global population of Ultra-HNWIs declined by 2.5 percent in 2011 and its wealth declined by 4.9 percent.

The HNWI population country ranking saw the US, Japan and Germany take the top three places.

George Lewis, group head, RBC Wealth Management, said: “While more people surpassed the $1m disposable income level in 2011, the aggregate wealth of high net worth individuals declined overall, as market volatility took its toll.

“It is significant that for the first time this year there are now more high net worth individuals in Asia-Pacific than in any other region. However, losses in key markets such as Hong Kong and India meant that wealth contracted in Asia-Pacific overall.”

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