Billionaire trends Asia – India surges, Hong Kong sees fall
Global billionaire wealth surged by 17.8% in 2021 to a record US$11.8 trillion, as the billionaire population rose by 3.3% to 3,311 individuals, according to Altrata’s recently released Billionaire Census 2022.
This marked the third successive year of billionaire population expansion, but the weakest growth since 2018, with growth buoyed by a largely rebounding global economy and a strong upturn in corporate earnings and IPO activity.
While the 3,311 billionaires represent just 0.9% of the global ultra-high net worth (UHNW) population – those with more than US$30 million in net worth – they hold a vast 27.4% of total UNHNW wealth.
Growth of the billionaire class and cumulative wealth in Asia lagged North America and Europe. The billionaire population rose by 1.8% to 899 individuals, with total net worth up 11.7% to $2.9trn This was a strong expansion of wealth in historical terms but the weakest growth of all seven regions in 2021.
Asia is home to 24.5% of billionaires, while Europe to 26.5% and North America, 39%. Despite this, Asian cities accounted for seven of the top 15 cities in terms of billionaire population.
We highlight the billionaire themes and trends across Asia.
China home to second largest billionaire population globally despite dip
China is home to the second largest population of billionaires globally after the US, with 400 billionaires worth US$1.451bn. However, it did see a slight drop in billionaires in 2021 of 2.4%. This partly reflected differing approaches to virus suppression, but also regulatory and political factors. Moves by the Chinese government to reform the outsized real estate sector and curb large technology firms, amid an overall tightening of financial conditions, weighed on corporate earnings and Chinese equities — the MSCI China All Shares Index slumped by 14% (in US dollar terms). Beijing is the highest ranked Chinese city, in sixth place.
India sees expansion of its billionaire population by 20%
The billionaire population of India expanded by almost 20% in 2021, continuing the firm upward trend of recent years and lifting the country into the top four for the first time. Wealth creation is being supported by a combination of robust economic growth, structural reform, infrastructure development and political patronage, not to mention strong population growth.
Hong Kong loses ground in wealth creation, but still ranks second as city with most billionaires
Hong Kong was the top city in Asia, and second top city globally for the number of billionaires with 114, having added three in the last year. The city ranked second after New York which gained 13 billionaires. Hong Kong was also third highest in terms of billionaire density, thanks to its focus on financial services. That said, Hong Kong has lost ground against a backdrop of domestic constraints and generally sluggish emerging-market equities but retained its comfortable lead over third-ranked San Francisco. Wealth creation in Hong Kong remained inhibited by its diminishing status as an international business hub for non-financial firms.
Banking and finance continue to lead billionaire generation
Financial services have long been a major driver of wealth generation in many of the world’s largest billionaire markets, especially in the US, the UK, Hong Kong and Switzerland, and 2021 is no different with the banking and finance sector the main industry focus for the largest share of billionaires. This share is twice as large as the second-ranked sector of industrial conglomerates.
While there has been a gradual decline in the size of the global banking and finance industry over the past decade, caused by post-financial crisis restructuring and regulation, the influence of financial markets on billionaire wealth has arguably increased, reflecting a period of unprecedented central bank liquidity, historically low interest rates, and relatively subdued global growth and consumer demand.
Real estate ranked third in billionaires’ primary industry focus, followed closely by technology, each accounting for 7% shares. Manufacturing, business and consumer services, healthcare and the non-profit sector all accounted for 5-6%, though the report predicts that healthcare is likely to see its billionaire share rise in the coming years, thanks to the pandemic and ageing of the most developed economies.
Unsurprisingly, technology has by far the youngest, most self-made and male billionaires, with the median age of billionaires in the tech sector at 54.6, that’s 11 years younger than that of the global billionaire population. Also, a significantly larger share of tech-focused billionaires are in the highest wealth tiers (those above US$10bn and US$50bn).
Female representation is highest in manufacturing thanks to inheritance
When it comes to gender, the global billionaire population remains heavily male dominated, with women accounting for a modest 13% share, though on a gradual upward trend reflecting growth in female entrepreneurship, in particular. Female representation is highest in the manufacturing sector (13%), in part due to the role of inheritance which is far more common among female billionaires than their male counterparts.
Education is top philanthropic cause among billionaires
Whether influenced by global developments, personal motivations or local issues, billionaire donors have a wide range of charitable causes to which to give. However, there are a number of areas that consistently attract the largest shares of donations, and the relative popularity of billionaires’ favourite philanthropic causes tends to remain fairly stable. Preferences for giving activity vary only slightly according to billionaires’ primary industry. Education is, by some distance, the most popular area for benevolent donations across all five industries, followed by a combination of the same three charitable causes: healthcare/ medical research, arts and culture, and social services.
