With stellar stock market performances across the world, global wealth grew at a strong pace in 2021, according to the Credit Suisse’s annual Global Wealth Report, with total wealth in mainland China up 15.1% year over year to $85.1trn.
“In 2021, the US added to its total wealth $19.5trn and China added $11.2trn,” said Anthony Shorrocks, economist and the author of the report.
“Year after year, we find those two countries often dominating what’s going on. The next country is Canada with $1.8trn in wealth growth. Even in second place, the growth in China is five to six times as much as the next country.”
China also ranked second globally in terms of the number of millionaires and ultra-high net worth (UHNW) individuals.
In 2021, it had 6.2 million millionaires, up by more than one million from 2020 and equivalent to about 10% of the global millionaire population.
It is expected that the number will reach 12.2 million by 2026, according to the report.
The number of UHNW individuals in China increased by 5,200 from 2020 to 32,710 in 2021. The number is estimated to increase to 60,000 by 2026, almost the same as the whole of Europe, the report said.
China also recorded the fastest individual wealth growth rate across the world.
The wealth per adult in China increased more than 10 times over 21 years to $76,639 in 2021 from 2000.
Credit Suisse believes it is set to overtake the global mean of $87,489 if the growth rate continues.
The median wealth growth in China has also “exploded” by rising more than eightfold to $26,752 in 2021 from $3,133 in 2000, the report found.
Hong Kong
In 2021, Hong Kong recorded 632,000 millionaires and the number is expected to almost double to about 1.3 million millionaires by 2026.
Yet, in a year-over-year comparison, Hong Kong was one of the few jurisdictions that posted a decrease in the number of UHNW individuals by 130.
The other biggest falls included the UK (1,130) and Turkey (330).
The drop in UHNW individuals can be attributed to the fall in share prices in the special administrative region during 2021, said Credit Suisse.
“I do not know why share prices fell in Hong Kong during 2021, but it certainly contributed to the fall in UHNW individuals, by lowering the growth rate of wealth per adult to just 1% in 2021, according to our estimates,” said Shorrocks .
He added that the firm believes the reduction at the top reflected the fact that wealth inequality fell in Hong Kong during last year.
The study also found that wealth per adult in Hong Kong was ranked third globally at $552,930 in 2021, increasing $5,210 from the year before.
Switzerland and the US top the chart in terms of individual wealth.
Hong Kong is ranked fourth place globally at $202,380 median wealth per adult, an increase of $8,250 from 2020.
Going forward, the Swiss investment bank believes wealth creation will be disrupted by worldwide inflation and the Russia-Ukraine conflict over the next few years.
Nevertheless, global wealth in nominal US dollars is expected to increase by $169trn by 2026, representing a rise of 36%.
Middle income countries will be the driver of global trends, while low and middle income countries will be responsible for 42% of wealth growth.
Global wealth per adult is forecast to pass the threshold of $100,000 in 2024, with the number of millionaires hitting 87 million by 2026.
