August 18, 2022
SINGAPORE – Over the next eight years, Singapore’s number of millionaires as a proportion of its population will exceed that of the United States, China or any other economy in the Asia-Pacific region, HSBC said in a report.
The Republic, where 7.5% of the adult population had wealth of at least US$1 million (S$1.38 million) in 2021, would see the share of millionaires rise to 9.8% in 2025, then at 13.4% in 2030.
The study focuses on the resident population which includes citizens and permanent residents.
To measure the wealth of millionaires, HSBC said it used their cash in banks and investments in securities such as stocks and bonds. It also took into account real estate, which includes owner-occupied properties, net of outstanding mortgage amounts.
The bank said that in Asia, Singapore is already second only to Australia, whose share of millionaires per capita was 8% in 2021.
By 2030, Australia will fall to second place with 12.5% of the nation holding cash and assets of at least US$1 million.
That year, 11.1% of Hong Kong’s population will be millionaires, 9% for the United States, 7.2% for Japan and 4.4% for China.
The share of Singapore residents with wealth of at least $250,000 will rise to 67% by 2030, second only to Australia’s 70.8%, according to the report titled The Rise Of Asian Wealth.
HSBC said the growth of millionaires in Asia will continue until 2035, with their projected share reaching 17% for Singapore, ahead of 15.1% for Australia and 14.6% for Hong Kong.
However, in absolute terms, the most populous countries will continue to dominate the region’s millionaire league.
The number of adults with wealth of at least $1 million in China stood at 17.1 million in 2021. HSBC said that number will rise to 50.4 million in 2030.
The number of Singaporean millionaires will increase over the same period from 400,000 to 700,000.
Mr. Frederic Neumann, Chief Asia Economist at HSBC, said the region’s deepening pool of local savings provides a measure of resilience against the vagaries of global financial markets and the challenges of rising inflation and slowing growth.
“An account of Asia’s growing wealth also highlights the societal resources that are ultimately available to lift millions more out of poverty,” he said in the report.
“After all, the region is not short of capital, even if it is unevenly distributed, both between economies and within them.”
He noted that financial wealth in Asia began to overtake that of the United States after 2008 with the onset of the global financial crisis, the worst economic disaster to hit the United States since the Great Depression. Asian financial wealth reached just under US$140 trillion in 2021, well above US$120 trillion in the United States.
Japan accounted for more than half of the wealth held in the region in the years following the global financial crisis. But in 2021, China’s share jumped to 46% while Japan’s fell to a quarter.
However, excluding Japan, Asia’s financial wealth is still lower than that of the United States, at around US$100 trillion.
But “given current trends in per capita income growth, wealth in Asia excluding Japan could surpass that of the United States by 2025,” Neumann said.
The number of millionaires in Asia, excluding Japan, is expected to rise from about 30 million currently to more than 76 million by the end of the decade, he added.