Global HNWI population grew at 9.5% in 2017 and Global Wealth grew at 10.6% in the same year. There is a prevalent trend of growth in wealth throughout international markets which positions service providers in the private client spheres, such as wealth managers and investment migration professionals in a favorable position.
As the wealth population continues to grow year on year, a tendency that has been noted in various reports and data sets, so too increases the demand to serve the growing affluent classes. Only a decade ago, in 2008-2009 the total Global HNWI Population was estimated to be between 8.5 to 10 Million individuals. This has practically doubled with the latest 2017 estimates at 18.7 Million.
Read more: Why ignoring a Sector that manages 5 Trillion US$ is a costly mistake.
Regional Distribution of Wealth
HNWIs – are those individuals considered to own over US$ 1 Million, very HNWIs those whose net worth is over US$ 5 Million and UHNWIs are those considered to have a net worth of at least US$ 30 Million (in constant 2018 US$). According to the recent Knight Frank Wealth Report, it is estimated that Russia & CIS as well as Asia will have the highest growth rates in their UHNWI populations over the next 5 years.
Interesting to note is of the budding Asian UHNWIs, this growth is forecast to stem from a handful of countries namely India (estimated 39% growth), Philippines, (estimated 38% growh and China (estimated 35% growth) in the next five years. Similarly in Africa, the wealth is also concentred predominantly in South Africa, Egypt and Kenya, which have the largest proportions of UHNWIs in the African continent.
The table below depicts the UHNWI populations in specific markets of interest to private client advisors:
|
COUNTRY |
UHNWI POPULATION |
|
China |
9953 |
|
Brazil |
3754 |
|
Mexico |
2778 |
|
India |
1974 |
|
Turkey |
1695 |
|
Russia |
1500 |
|
Saudi Arabia |
950 |
|
Chile |
748 |
|
South Africa |
661 |
|
Colombia |
478 |
|
Egypt |
283 |
|
Philippines |
215 |
|
Vietnam |
142 |
Deconstructing the LATAM Markets
Global wealth in the Latin American region is set to grow, based on Knight Franks recent Wealth Report, the 5-year growth forecast for this region is expected to be 21%. Latin America has had an overall trend of economic growth, excluding certain countries that have been poorly impacted by political and economic crisis such as Venezuela, Argentina and recently Brazil.
Over the past decade the GDP growth of Colombia has ranged from 3.5% to 5%, Panama 4% to 7%, Peru 3% to 5%, Chile 3% to 5%. Business friendly initiatives have been implemented throughout and FDI is increasing in the region in technology, insurance and renewable energy, bolstering its growth and the wealth of its local populations.
One particularity of the wealth distribution in LATAM is that the HNWIs there have a higher concentration of wealth than in most other regions.
Based on the latest estimates of UHNWIs in 2018, we’ve underlined the markets in LATAM which have considerable populations, these include Brazil and Mexico which rank above India, as well as Chile and Colombia.
The investment migration industry has been entering this region yet predominantly focusing on US global mobility solutions such as the E2 or EB-5 investor permits. As these markets continue to soar and socioeconomic and political turbulence persist, the need for viable investment migration solutions will increase.
