Consulting firm Capgemini has published its latest World Wealth Report, which tracks the spending and investing habits of the world’s high net worth individuals (HNWIs).
High net worth individuals are defined by the group as those who have investable assets of US$1 million (R17 million) or more – excluding primary residence, collectables, and consumables.
The investible assets include the value of private equity holdings stated at book value, as well as all forms of publicly quoted equities, bonds, funds and cash deposits – while also accounting for undeclared savings.
According to the report, South Africa had 95,400 HNWIs at the end of 2019, up from 90,100 at the end of 2018, which was the first decline in the HNWI population since 2015.
Despite gaining 5,300 HWNIs in 2019, the average wealth held by these individuals has only grown slightly.
Total wealth held is up to $1.3 trillion, from $1.2 trillion the year before – but the average held by HWNIs has only increased by $59,000, from $13.74 million in 2018 to $13.8 million in 2019.
In rand terms, the average super wealthy South African is worth around R233 million, according to Capgemini’s data.
The table below outlines the changes from 2018 to 2019.
|HNWIs||90 100||95 400||+5 300||+5.9%|
|HNWI Wealth||$1 238.4 billion||$1 316.9 billion||+$78.5 billion||+6.3%|
|Average||$13.74 million||$13.80 million||+$59 000||+0.4%|
|ZAR (1 USD = 16.88)||R231.9 million||R232.9 million|
According to Capgemini, the global HNWI wealth and population grew by almost 9% in 2019 despite a global economic slowdown, international trade wars and geopolitical tensions.
North America and Europe took the lead with around 11% and 9% growth respectively, surpassing Asia-Pacific (with 8%) for the first time since 2012.
“Yet the boom of the previous year has been cloaked with uncertainty as global economies brace for a projected 4.9% decline in 2020 as per the International Monetary Fund,” it said.
In North America, an 11% increase in both HNWI population and wealth (compared with a 1% wealth decline in 2018) meant the region accounted for 39% of global HNWI population gains and 37% of wealth growth in 2019.
European performance topped that of Asia-Pacific and Latin America, with HNWI population and wealth growing at almost 9%.
Despite robust market performance from several Asian countries including Hong Kong, China and Taiwan, APAC overall expanded by 8% in 2019, falling behind the average global HNWI growth rate of 9%.
However, the data reflects a time before the global Covid-19 pandemic hit nations across the world, the group noted, adding that things look differently now.
“As per World Federation of Exchanges reports, Covid-19 erased more than $18 trillion from global markets over the course of February and March 2020, before a slight recovery in April.”
Analysis from Capgemini projects a decline of between 6% and 8% in global wealth until the end of April 2020 (compared with December 2019).