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The report has been prepared in close cooperation with CLSA, Asia’s leading independent brokerage and investment group. Benefiting from Julius Baer’s on-the-ground presence in Hong Kong and Singapore, the report examines the drivers of wealth creation in ten of the most significant economies in Asia Pacific and forecasts the future size of the HNWI market by country.
Key findings include the following:
For 2011 and 2012, Julius Baer forecasts that China and India together will contribute over 40% of global growth alone. The current deterioration in global economic conditions will see further supportive, pro-growth policies from China in the months ahead.
The estimated 1.16 million HNWIs across Asia with wealth of USD 5.60 trillion in 2010 is forecast to more than double to 2.82 million with wealth to almost triple to USD 15.81 trillion by 2015.
China alone is forecast to have 1.40 million HNWIs with stock of wealth of USD 8.76 trillion by 2015.
Indonesia stands out with the highest growth rate in terms of numbers of HNWIs over the 5-year-period with 25% – rising to 99,000 with a stock of wealth of USD 487 billion by 2015.
Currency appreciation is key: The varying rates of rising currencies across Asia may create 600,000 new US dollar-based millionaires by 2015.
Furthermore, based on client surveys and interviews covering a wide range of topics such as environment, philanthropy, investing, lifestyle and education, the report shows how Asia’s HNWIs view the world. It also analyses the investment portfolios of HNWI in Asia by asset class and compares them to their peers in Europe and Latin America.
Julius Baer Lifestyle Index launched
In order to capture the consumption costs in Asia Pacific and the inherent inflation, Julius Baer also launched the Julius Baer Lifestyle Index together with the report. Based on a basket of 20 luxury goods and services that represent discretionary purchases of HNWI in the region, the index covers high-end vendors across four major cities: Hong Kong, Shanghai, Singapore, and Mumbai. The fact that the Index was up 11.7% for the one-year time period until April 2011 shows clearly that the cost of living in luxury in Asia substantially outpaces conventional CPI measures, which stood at 5.1% for the same time period analysed. Going forward, this Lifestyle Index will give investors direction in terms of future investment returns required to finance a certain lifestyle as well as an indication of the underlying inflation.
Boris Collardi, CEO Julius Baer, explains the rationale for this report: “We talk to our clients about key issues influencing their lifestyles and investment decisions on a daily basis. Our report is unique as many of the insights come from conversations with our clients, enabling a deeper understanding of what is important in this market.”
Commenting on the future use of the report, Dr Thomas Meier, CEO Asia, comments “Just as important as following the drivers of wealth development in Asia, and having a deep understanding of our clients investment needs, we pride ourselves on our ability to transform this knowledge into attractive product and advisory solutions for our clients all over this region.”
With this report, Julius Baer shares its vast experience it has in Asia, while at the same time remaining committed to servicing our clients worldwide.