The Asia Pacific, excluding Japan, surpassed Europe in terms of private wealth, says Boston Consulting Group report.
Asia surpassed Europe to become the world’s second-richest region in terms of private wealth last year, according to new research. Private wealth in the Asia Pacific, which excludes Japan, grew by a steep 29 per cent in 2014 to nearly £30 trillion. The stellar rise was aided by increase in the number of millionaires in India and China.
A strong “old world versus new world” dynamic was observed, according to the most recent annual report from the Boston Consulting Group, as private wealth continued to grow in most markets last year, but at significantly different rates.
Overall, global private financial wealth grew by nearly 12 per cent last year to a total of $164 trillion, in line with 2013’s growth which was just over 12 per cent. The expansion of wealth was driven by strong gains in the stock and bond markets, while the creation of new wealth was also a key factor.
The report showed that North America retained its title as the world’s richest region, as private wealth grew around six per cent to a total of £32 trillion this year. However, the report notes that Asia Pacific’s projected compound annual growth rate of around ten per cent should see it overtake North America as the world’s richest region in 2016.
By 2019, Asia Pacific is forecast to see wealth expand to more than £42 trillion, and will account for one-third (34 per cent) of all global wealth. In comparison, the report expects wealth in North America to grow to £39 trillion, which would account for around 28 per cent of the global total.
Dropping down to third place was the combined region of Eastern and Western Europe, with a combined total of £27 trillion last year. In the year before, the combined region was shown to be the second-richest. However, it was unable to match the rapid expansion of wealth in the Asia Pacific, as its wealth continues to grow at staggering rates.
Japan’s private wealth saw comparatively low growth of around two per cent in 2014, to a total of £8.8 trillion. However, due to the recent weakening of the yen versus the US dollar (down eight per cent in 2014 and 18 per cent in 2013), in dollar terms growth in private wealth was lower than in previous years. Despite this, the weaker yen continued to support export growth and the wider economy.
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