World Wealth and HNWI Migration
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August 1, 2022
World wealth was estimated to be $1,500 trillion in 2020, including a third in financial assets such as stocks and bonds held by financial corporations, a third held by households, governments, and nonfinancial businesses, and a third in nonfinancial assets such as machinery, real estate, and intellectual property.
World wealth of $1,500 trillion was 6x world GDP of $255 trillion in 2020 (PPP)
A major reason for rapidly rising global wealth is low interest rates that increased the value of assets, such as the tripling of home prices between 2000 and 2020 in major industrial countries. Australia, Canada, France, and the United Kingdom had the highest growth among countries in the value of household real estate relative to GDP.
Global per capita net worth (assets minus liabilities) averaged $66,000 or $104,000 per person at Purchasing Power Parity (PPP). Per capita net worth ranged from $46,000 in Mexico to $350,000 in Australia in nominal terms, and from $104,000 to $356,000 at PPP. Australia and Canada have extensive natural resources relative to the size of their populations, explaining their high net worth per capita, while Germany and Japan have significant machinery and other real assets that increase per capita net worth.
Per capita net worth ranged from $46,000 to $355,000 per person in 2020
Household net worth is distributed unevenly within countries. The richest 10 percent of households in China and the US owned about two-thirds of each country’s wealth in 2020. The bottom half of Chinese households had about five percent of China’s wealth, while the bottom half of US households had two percent of US wealth.
Most household net worth is in housing; residential real estate was almost half of global net worth in 2020. Adding the value of buildings and land owned by corporations and governments makes real estate two-thirds of global wealth.
Real estate is 2/3 of global wealth
A country’s wealth typically rises in lockstep with GDP growth. However, Japan’s bubble economy in the late 1980s allowed net worth at market prices to be eight times GDP. A similar story is emerging in China, where net worth was almost eight times GDP in 2020.
On average, wealth is 50% larger than a country’s GDP
HNWIs. High net worth individuals are defined as persons with investable assets of $1 million or more, excluding their primary residence and consumer durables, while ultra HNWIs have $30 million or more in investable assets. Capgemini estimated that there were 22.5 million HNWIs in 2021, including a third each in North America and the Asia-Pacific region.
2/3 of the HNWIs in 2021 were in North America and Asia
These HNWIs had $86 trillion in financial wealth in 2021, including $28 trillion or a third in North America and $25 trillion or 30 percent in Asia.
Almost 2/3 of the $86 trillion in financial wealth in 2021 was in North America and Asia
By country, the US had 7.5 million HNWIs in 2021, followed by 3.6 million in Japan, 1.6 million in Germany, 1.5 million in China, and 775,000 in France.
The US had 1/3 of global HNWIs in 2021
Migration. Over 100 countries offer golden visas that allow foreigners to become residents or citizens of other countries by investing in real estate or businesses in the country. Many wealthy individuals who are uncertain if they can retain their wealth at home become immigrants and sometimes citizens of other countries by purchasing real estate or making investments.
Caribbean golden visas are among the lowest cost, typically requiring $100,000 for citizenship that can lead to visa-free travel to a wide range of destinations in less than a year. European programs usually require more investment and time before the foreign investor can become a citizen.
Selected Caribbean Golden Visas
| Country | Minimum capital | Processing time | Key benefit |
|---|---|---|---|
| Antigua and Barbuda | USD 100,000 | Three—four months | Visa-free or visa-on-arrival travel to 150 destinations including Hong Kong, Russia, Singapore, the UK, and Europe's Schengen Area |
| Dominica | USD 100,000 | Three months | Visa-free or visa-on-arrival travel to 144 destinations worldwide |
| Grenada | USD 150,000 | Three—four months | Visa-free or vsia-on-arrival travel to 144 destinations including China, Russia, Singapore, the UK, and Europe's Schengen Area |
| St. Kitts and Nevis | USD 150,000 | Three—six months | Visa-free or visa-on-arrival travel to 156 destinations including Hong Kong, Russia, Singapore, the UK, and Europe's Schengen Area |
| St. Lucia | USD 100,000 | Three—four months | Visa-free or visa-on-arrival travel to 146 destinations including Hong Kong, Singapore, the UK, and Europe's Schengen Area |
Selected European Golden Visas
| Country | Minimum capital | Processing time | Key benefit |
|---|---|---|---|
| Austria | Substantial contributions to the Austrian economy | 24—36 months | Opportunity to become an EU citizen upon making a substantial capital contribution |
| Malta | EUR 738,000 investment | 14-38 months | An attractive place in which to live or own a second home, strategically located, with excellent air links |
| Montenegro | EUR 450,000 | Eight—ten months | Free movement to Montenegro, the countries in Europe's Schengen Area, Russie, and Türkiye |
| North Macedonia | EUR 200,000 | Two—five months | Free movement to Hong Kong, Japan, Singapore, Türkiye, and Europe's Schengen Area, among others, as well as an e-visa to India |
| Türkiye | USD 400,000 | 120 days | Free movement to Türkiye, Hong Kong, Japan, and Singapore, among others |
About 100,000 or five percent of the world’s 20 million HNWIs move from one country to another each year. The Henley Global Citizens Report projected that 15 percent of the 100,000 Russian HNWIs would emigrate in 2022, followed by one percent of the 10 million Chinese HNWIs.
Russia, China, and India are projected to provide 1/3 of the migrant HNWIs in 2022
| Country | Projected net outflows of HNWIs (2022) | % of HNW |
|---|---|---|
| Russia | 15,000 | 15% |
| China | 10,000 | 1% |
| India | 8,000 | 2% |
| Hong Kong | 3,000 | 2% |
| Ukraine | 2,800 | 42% |
| Brazil | 2,500 | 2% |
| UK | 1,500 | 0% |
| Mexico | 800 | 0% |
| Saudi Arabia | 600 | 1% |
| Indonesia | 600 | 1% |
The leading destinations for emigrating HNWIs include the UAE, Australia, Singapore, and Israel. HNWI migrants seek stable countries with growing economies and low taxes, including no inheritance taxes.
The UAE and Australia lead among destinations for HNWI migrants
References
Capgemini. 2022. World Wealth Report 2022.https://worldwealthreport.com/
Henley. Golden Visas.https://www.henleyglobal.com/residence-investment/golden-visa