One million wealthy families in the Gulf Cooperation Council (GCC) countries own investment assets worth about $1.2 trillion, a new report has said.

The KFH-Research report about wealth and funds management said that the world’s population of high net worth individuals (HNWIs) grew by a marginal 0.8 per cent year on year to 11 million in 2011. This pace was sluggish compared to growth rates of 17.1 per cent in 2009 and 8.3 per cent in 2010.

The aggregate financial wealth of these HNWIs also declined by 1.7 per cent to $42 trillion in 2011, mainly due to challenging global macroeconomic conditions and volatile global financial markets, the report said.

This rate of growth in 2011 was much slower than 18.9 per cent clocked in 2009 and 9.7 per cent logged in 2010 given the significant rebound from crisis-related losses post the global financial crisis, it added.

Asia Pacific was the star performer, which saw the number of HNWIs in the region rise by 1.6 per cent year on year to 3.37 million individuals in 2011 - the first time that as a region Asia Pacific surpassed North America in terms of HNWIs.

However in terms of asset values, the financial wealth of Asia Pacific HNWIs stood at $10.7 trillion in 2011, a slight decline of 1.1 per cent. In 2011, Hong Kong and India were hit by declines in their equity markets’ capitalisation.

In Hong Kong, concerns on the European sovereign debt crisis weighed on the outlook for growth.

Meanwhile in India, sentiments were subdued due to factors including perceived slow pace of domestic reforms.

Elsewhere in Singapore, financial wealth was impacted by the sharp drop in export revenues. In contrast, Thailand’s financial wealth rose on the back of significant real estate gains as well as a solid growth performance, the report said.

In the Middle East, the number of HNWIs increased by 2.7 per cent to 0.45 million individuals. Total financial wealth of the Middle East HNWIs grew by 0.7 per cent to $1.7 trillion.

Globally, the US, Japan and Germany combined accounted for 53.3 per cent of the world’s HNWI population in 2011, up from 53.1 per cent in 2010, it said.

However, the share of global HNWI population held by these three countries combined has been eroding gradually from 54.7 per cent in 2006. The HNWIs of emerging and development countries continue to grow faster than those of developed countries.

Since the 1970s, when GCC oil companies were nationalised and oil prices surged, the region’s GDP as well as individual fortunes have grown significantly, it added.

(This article was published on December 9, 2012)
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