People walk through a shopping mall in Manhattan on July 5, 2024 in New York City.
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This growth was followed by Turkey (43%), Kazakhstan (37%), Indonesia (32%) and Japan (28%). The two centers that house the world’s biggest millionaires, the US and mainland China, will see increases of 16% and 8%, respectively.
However, the number of millionaires in the UK is predicted to fall by 17%.
Paul Donovan, chief economist at UBS Global Wealth Management, said the UK currently has the third highest number of dollar millionaires in the world, which he called “much more… than it deserves as an economy”.
He added that countries such as France and Italy, where the number of millionaires is set to rise by 16% and 9% respectively, are seeing “more natural” growth, while any growth in the UK would be offset by capital outflows due to a variety of “… push and pull” factors .
This is partly due to natural shifts in the distribution of wealth as the global economy undergoes structural changes and capital moves around the world, he told a media press conference.
Other factors driving the decline in millionaires include the introduction of UK sanctions against Russia – with wealthy Russians long using London as a home for their assets – and a “non-native millionaire population” who are constantly looking for low-tax locations such as Dubai and Singapore, Donovan added.
He did not cite the newly elected centre-left UK Labor Party as a contributing factor to the forecast. Instead, Donovan noted that changes to Britain’s so-called non-domiciled tax regime, initiated by the recently ousted Tory government, had had a “small, not material” impact.
Another country where the number of dollar millionaires is expected to decrease was the Netherlands, where a 4% decrease in such wealthy individuals is estimated.
Meanwhile, the report says the number of dollar millionaires in Russia will increase by 21%. Donovan said that was partly due to fluctuating currency rates as well as recent commodity and energy market trends benefiting some business owners.
UBS found that global wealth growth picked up again in 2023, posting 4.2% growth after a 3% decline in 2022. The recovery was mainly led by the EMEA (Europe, Middle East and Africa) region, which grew by 4.8% up from 4.4% in 2022. Asia Pacific and 3.5% in the Americas.
Meanwhile, the report presents a mixed picture of the evolution of wealth inequality. Between 2000 and 2030, UBS said, wealth mobility – a person’s ability to move up a level over a lifetime – will improve overall.
People who start in the lowest wealth bracket would have a 60% chance of moving up at least one wealth bracket and a 1 in 3 chance of moving up two or more wealth brackets, the report said.
However, growing clusters of high wealth at the top of major economies are increasingly distorting average wealth values.
“Some of these findings about individual wealth will come as no surprise to most readers, but others may be very unexpected. Many people may not know their own country. They may feel that reported growth or decline in wealth has passed them by,” UBS said. in message.
That’s because in many countries, the rise in average wealth has overlooked a sharp decline in median wealth – meaning higher inequality, with wealth becoming more concentrated among the richest.
Countries where average wealth lags most behind median wealth include France and Mexico, where it is twice as high. It is almost three times higher in mainland China, Hong Kong and Taiwan, and five times higher in the US, Brazil and the United Arab Emirates.
While the large intergenerational transfer of wealth has long been debated, UBS found in this year’s report that wealth isn’t just moving down, it’s also going “sideways” to spouses.
Of the $83 trillion expected to be passed down over the next 20 to 25 years, UBS estimates $9 trillion would be transferred “intergenerationally,” or horizontally, to spouses. Due to life expectancy and age differences between couples, much of this large wealth transfer is set to women.
A spouse will typically hold that inheritance for an average of four years before passing it on, UBS added, with the largest horizontal and vertical transfer of wealth taking place in the Americas.