The number of new millionaires in China is expected to increase more than seven times faster than in the U.S. in the five years through 2026, despite the effects of inflation and the Russian invasion of Ukraine, which are likely to hamper global wealth creation, according to Credit Suisse’s Global Wealth Report 2022. The number of U.S. dollar millionaires in China will increase by 97% to 12.2 million by 2026, compared with a 13% rise in the U.S. to 27.7 million over the same period, according to projections by the Swiss bank. “We expect household wealth in China to continue to catch up with the United States, advancing the equivalent of 14 U.S. years between 2021 and 2026,” the report said. “Despite the inflation and Russia-Ukraine war setbacks, we believe that total global wealth will continue to grow.”
Household wealth in China grew by USD11.2 trillion last year, accounting for over a quarter of the total increase in global wealth of USD41.5 trillion in 2021. The world’s second-largest economy had 9.9% of the global millionaire population at 6.2 million, behind the U.S., which had 39% of the total or 24.5 million wealthy individuals. While the U.S. tops the world millionaire table and is still far ahead of second-placed China, its dominance is set to slip amid limited GDP growth and the possibility that asset prices will subside from their peak values at the end of 2021, according to the report.
The Credit Suisse report, in its 13th edition, is an annual study compiled from data on the wealth of 5.3 billion adults in over 200 countries. The number of millionaires around the world is expected to exceed 87.5 million in 2026, growing 40% from the 62.5 million wealthy individuals at the end of 2021. This rapid rise reflects in part the fact that higher inflation will make it easier to pass the million U.S. dollar threshold, according to the report.
Credit Suisse expects global wealth to rise 36% to USD169 trillion by 2026, while wealth per adult is forecast to rise 28% during the same period, and pass the USD100,000 threshold in 2024. Hong Kong ranked third in terms of wealth per adult last year at USD552,930, after Switzerland with USD696,600 and the U.S. with USD579,050.
“While some reversal of the exceptional wealth gains of 2021 is likely in 2022/2023 as several countries face slower growth or even recession, our five-year outlook is for wealth to continue growing,” said Nannette Hechler-Fayd’herbe, Global head of economics and research at Credit Suisse. Meanwhile, Chinese tycoons made up nearly half of the 337 drop-offs from the world’s U.S. dollar-based billionaires list in the first three months of the year, outnumbering those from any other country due to a combination of wealth-destroying events such as the Covid-19 pandemic and Russia’s invasion of Ukraine, according to the Hurun Global Rich List 2022, published in March. The U.S. and Russia lost 32 and 13 billionaires from the list, respectively, the South China Morning Post reports.
