Pauline Springett in London
THE number of people across the world worth more than $1-million has tripled in 10 years and now tops six million, according to a report published this week.
This not-so-elite pool of people each with more than $1-million to his or her name has $17 000-billion at its disposal, a figure that is set to rise to $24 000-billion by the year 2000.
The report, produced by United States finance house Merrill Lynch in conjunction with management consultants Gemini Consulting, shows Asia and Latin America as the boom regions.
Last year alone, Latin America’s rich grew 22% more wealthy, while Asia’s elite enjoyed a 15% increase. The average worldwide was 8%.
Steven Beck, managing director of Gemini Consulting UK, said that criminal money probably added another 10 to 15% to the total, although no reliable data were available.
Beck said it would be wrong to conclude that the gap between the rich and the poor was widening.
“There is no evidence that the rich are getting richer. If anything, there is some indication that the opposite is happening. Our findings show that the distribution of wealth has not fundamentally changed; in fact it is marginally less concentrated than before,” he said.
Beck said the main reason for the growth in the number of dollar millionaires, and in the pot of riches they own, was the deregulation of many economies which were previously tightly state controlled.
The emergence of new stock exchanges was encouraging entrepreneurs to float their companies, which allowed them to transform paper wealth into liquid assets.
Michael Giles, chair of Merrill Lynch International Private Banking Group, said today’s super rich were much more financially sophisticated than their predecessors.
They demanded a better performance from their assets, were more adventurous in choosing investment locations and were less likely to remain loyal to one bank or adviser.
He said that while most “high-net-worth” clients still preferred Swiss banks, Switzerland had recently lost market share to offshore centres in the Caribbean and elsewhere. This was partly because Latin America’s new rich often preferred a centre that operated in their own time zone. Some clients, often mistakenly, believed that Swiss banks were expensive to use.
Giles said London remained a popular choice because of its pool of expertise. He believed this popularity would remain undented by a Labour government.