Asia Pacific to pass Western Europe in wealth

China and US still have the most millionaire households, even as global balance shifts

Led by China, the Asia-Pacific region will likely surpass Western Europe this year as the world's second-largest wealth market behind North America, according to the Boston Consulting Group.

Boston Consulting Group, or BCG, said Asia Pacific will probably have wealth assets of about $42.3 trillion at the end of 2107, compared to $41.9 trillion for Western Europe. The company separates Japan from Asia Pacific.

China possesses the highest private wealth in the Asia-Pacific region and the second-highest globally, according to an annual global wealth report that was released on Tuesday by the global management and consulting concern.

The US and China have the most millionaire households in the world, the report said. The US has nearly 7.1 million, and China is second with 2.1 million. Japan, the UK and Canada round out the top five nations that are home to millionaire households.

Mariam Jaafar, the head of Boston Consulting Group's wealth-management practice in Asia Pacific, noted that private financial wealth in the region grew 9.5 percent in 2016 to $38.4 trillion. That was the first time in five years that the region failed to post double-digit growth.

Jaafar still expects Asia Pacific to be at the forefront of global wealth growth and creation over the next five years. "Annual wealth growth (in the region) is expected to be at or near double-digit levels through 2021," she said.

The report shows that the wealthy in China and Asia Pacific remain very conservative investors, with about 65 percent of their assets in cash and deposits, 12 percent in bonds and 23 percent in stocks. In North America, 70 percent of the assets of wealthy are in stocks, with 16 percent in bonds and 14 percent in cash and deposits.

With China transforming its economy into a more balanced system, Jaafar noted that "a lot of Chinese wealth is still export-driven so a lot of that money is already offshore".

Global wealth increased 5.3 percent last year to reach approximately $166.5 trillion, and Boston Consulting projects global wealth will be at or exceed $223 trillion by 2021.

paulwelitzkin@chinadailyusa.com

(China Daily USA 06/14/2017 page2)