Middle East private wealth surged 11.6 per cent in 2013

Dubai: Private financial wealth in the Middle East region grew by 11.6 per cent to reach $5.2 trillion (Dh19 trillion) in 2013 with GCC countries leading the wealth surge, according to The Boston Consulting Group’s 2014 Global Wealth Report.

Key drivers were generally high saving rates and continued strong nominal gross domestic product growth in oil-rich countries, such as Saudi Arabia, Kuwait and the UAE.

While private wealth in Saudi Arabia grew by 13.4 per cent last year, in the UAE and Kuwait it surged by 12.8 per cent and 13.6 per cent, respectively.

Across all regions, including the Middle East and Africa (MEA) region, recovery of equity markets contributed substantially to the growth in private financial wealth.

“The amount of wealth held in equities rose by 30.5 per cent across major MEA markets, compared with 6.4 per cent for bonds and 5.7 per cent for cash and deposits. With a projected compounded annual growth rate of 6.5 per cent, private wealth in the region will reach an estimated 7.2 trillion by the end of 2018, approximately a 3.6 per cent share of total global wealth,” said Markus Massi, Partner and Managing Director, The Boston Consulting Group.

Qatar ranks first in the world with the highest density of millionaires, with 17.5 per cent holding private wealth of at least $1 million. Kuwait is fifth with 9 per cent, while Bahrain (5.9 per cent) secured the sixth place. Oman and Saudi Arabia rank tenth and thirteenth, respectively.

Qatar also ranks sixth globally by ultra-high-net-worth (UHNW) households, defined as households with more than $100 million in private wealth. Kuwait, in turn, is in seventh place while Bahrain holds the sixteenth spot.

According to the report, global private financial wealth grew by 14.6 per cent in 2013 to reach a total of $152 trillion. The rise was stronger than in 2012, when global wealth grew by 8.7 per cent. The key drivers, for the second consecutive year, were the performance of equity markets and the creation of new wealth in rapidly developing economies.

The total number of millionaire households (in US dollar terms) reached 16.3 million in 2013, up strongly from 13.7 million in 2012 and representing 1.1 per cent of all households globally. The US had the highest number of millionaire households (7.1 million), as well as the highest number of new millionaires (1.1 million).

Robust wealth creation in China was reflected by its rise in millionaire households from 1.5 million in 2012 to 2.4 million in 2013. The number of millionaire households in Japan fell from 1.5 million to 1.2 million, driven by the 15 per cent fall in the yen against the dollar.