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Asia Pacific to top the world in wealth by 2019 - Boston Consulting Group

Source: Asia Insurance Review | Jul 2017

Asia Life & Health Wealth Management

The Asia Pacific region, excluding Japan, will likely surpass Western Europe this year as the world’s second largest wealth market behind North America, according to the Boston Consulting Group (BCG). Asia Pacific will probably have wealth assets of about US$42.3 trillion at the end of 2107, compared to $41.9 trillion for Western Europe. 
 
   Furthermore, Asian financial centres, Singapore and Hong Kong, will attract more wealth – a development that will help to propel Asia Pacific to become the world’s wealthiest region by 2019, the BCG study shows. Private wealth in Asia Pacific, including Japan, is expected to surpass North America by 2019 and hit $77.8 trillion by 2021.
 
   Ms Mariam Jaafar, the head of BCG’s wealth management practice in Asia Pacific, said: “Annual wealth growth (in the region) is expected to be at or near double-digit levels through 2021.” 
 
   The report also shows that the wealthy in Asia Pacific remain very conservative investors, with about 65% of their assets in cash and deposits, 12% in bonds and 23% in stocks. In North America, 70% of the assets of wealthy are in stocks, with 16% in bonds and 14% in cash and deposits.
 
   With China transforming its economy into a more balanced system, Ms 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% last year to reach $166.5 trillion. The US and China have the most millionaire households in the world, the report says. 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.
 
   BCG’s measurement of private wealth includes household holdings such as life insurance, pensions and assets such as equities, bonds and cash. A 
 
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