Malaysia to beat UAE in billionaire count
KUALA LUMPUR: Malaysia will have 20 billionaires in 2018, compared with 19 in the United Arab Emirates, according to a new white paper from the London-based WealthInsight Intelligence Center in its December 2014 edition. The UAE is an emerging economic powerhouse in the Gulf.
The centre tracks wealth and liquidity events as they happen and prepare detailed profiles of major private banks, wealth managers and family offices in each market.
“With a population of only 28.3 million, Malaysia has a similar number of millionaires than much more densely populated countries such as Indonesia, whose population stands at 237.6 million,” said WealthInsight analyst Tom Carlisle. “This demonstrates the big potential for billionaire growth in Malaysia.”
“Malaysia’s billionaire growth has been large; with US$46 billion in 2013. Malaysian billionaires have 209 per cent more wealth than the entire millionaire population of Paraguay.”
WealthInsight said the number of millionaires in Malaysia was expected to reach 30,054 by 2018.
The Malaysian economy had performed well during the financial crisis, resulting in the amount of HNWIs rising by 45.5 per cent over the period 2009-2013 to 26,015.
“Growth like this is very hard to maintain, but the high rising level of new wealth and investment in Malaysia and neighbouring countries means further growth will be seen. Malaysian HNWIs are currently investing 54 per cent of their overseas portfolio in the Asia-Pacific,” said Carlisle.
“Malaysian HNWI wealth has increased substantially, finding high levels of growth and investment in real estate which will be influenced further by the high levels of GDP estimated over the next five years.”
It said that in 2013, Malaysia had over 26,000 HNWIs with their wealth standing at US$151 billion (RM527 billion). “Fifty four per cent of Malaysian HNWI foreign wealth was invested in Asia-Pacific countries, compared to only 46.8 per cent of Indonesian HNWI foreign wealth.”
Malaysia’s overall wealth was similar to countries such as Argentina (US$160 billion), Colombia (US$154 billion) and Indonesia (US$206 billion).
Kuala Lumpur, according to WealthInsight, is the city with the highest level of high net worth individuals (HNWIs) at 13,800 in 2013, more than Abu Dhabi (12,500), Cape Town (8,753) or Birmingham (8,736).
Carlisle said that since becoming an Islamic banking hub, Malaysia had seen a large surge in investment to its shores, increasing by 52.6 per cent since 2008 to US$11.6 billion.
Unlike other economies in the AsiaPacific, said Carlisle, the Islamic private banking sector in Malaysia had been positively influenced by the government, especially through infrastructure projects and increased spending on education.
Investments over the next five years, he continued, would provide Islamic private banks in Malaysia the opportunity to employ homegrown talent and provide high quality service to HNWI clients.
Malaysia, just like many countries in the AsiaPacific, he stressed, could increase wealth creation through investing significantly in infrastructure and offering tax incentives to foreign businesses to invest more in the country. “Malaysia saw a significant increase in foreign direct investment and higher levels of activity in the local stock market, performing better than the global average between 2009 and 2013,” said Carlisle.
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