The BRICS club of nations has experienced an explosion of ultra-wealthy individuals in the past few years at the back of bourgeoning economic bases. Will they sustain this trend?
This comes of the latest analysis of research firm WealthInsight which suggests that global economic slowdown could have a significant impact on wealthy individuals in China and the other BRICS nations.
The BRICS bloc and other emerging economies, made of Brazil, Russia, India China and South Africa has had major impact on the complexion of global individual wealth lists. Mexican telecommunication mogul, Carlos Slim Helu seems set to keep the spot in the Forbes list of multi dollar billionaires beating traditional leaders like Bill Gates and Warren Buffet.
In a statement Wealth-Insight said the ultra-wealthy populations in the BRICS countries have prospered in recent years, increasing in number by almost a third and largely withstanding the global financial crisis. With considerable challenges ahead for each member, can the BRICS’ keep building wealth?
As of 2011, there are approximately 1.9 million high net worth individuals (HNWIs) in the BRICS, with a combined wealth of $7.5 trillion. This equates to 11.3% of total worldwide HNWI volumes (16.8 million) and 11.4% of total worldwide HNWI wealth (US$66 trillion). The total number of HNWIs in the BRICS increased by 30% over the review period, from 1.5 million in 2007 to 1.9 million in 2011. HNWIs refer to individuals with net assets of US$1 million or more excluding their primary residences.
The statement said the total number of HNWIs in the BRICS is forecast to grow by 76%, to reach 3.4 million by 2016. Chinese cities will dominate overall, but the fastest growing places for Ultra-HNWIs will be in India.
Despite a slowdown in the global economy and fears over a hard-landing, China has continued to grow strongly. At the end of 2011 66% of HNWIs in the BRICS countries were based in China. WealthInsight analysis suggests that the impact of an economic slowdown could have a significant impact on wealthy individuals in China and the other BRICS.
According to WealthInsight data, there are 17,450 multi-millionaires in the BRICS countries (those with net assets of over US$30 million). At the end of 2011, the majority of these individuals were based in China (45%, or 7,905). Brazil accounted for 4,123 multi-millionaires, followed by India (1,576), Russia (1,293), and South Africa with 543.
The number of multi-millionaires increased rapidly over the review period, up by almost a third from 2007 levels. At the end of 2011, China accounted for twelve (40%) of the top 30 BRICS cities for the ultra-wealthy. There were nine in Brazil, five in India, two in Russia and another two in South Africa. Beijing was the largest city for these (1,318 multi-millionaires), followed by São Paulo (1,310), Shanghai (1,028), Moscow (821) and Mumbai (577).