Qatar has the world’s third-highest density of millionaires with 116 out of every 1,000 households holding private wealth in excess of $1mn, according to The Boston Consulting Group (BCG).
Remarkably, last year, in Qatar, 86 out of every 1,000 households had private wealth above $100mn, said the report Global Wealth 2015: Winning the Growth Game, released yesterday.
“The highest density of millionaires in the world was in Switzerland, followed by Bahrain and Qatar,” it said, adding in 2013, Qatar ranked Number One in the world by proportion of millionaire households.
Based on BCG’s comprehensive study, private wealth in Qatar grew by 6.5% in 2014, driven mainly by equities. Between 2013 and 2014, the amount of wealth held in equities rose by a healthy 10.9% compared to 4.6% for bonds, and 3.9% for cash and deposits.
“Qatar is poised for further growth (9.6%) in the next five years, with the wealth breakdown anticipated to be 44% in cash and deposits, 9% in bonds, and 47% in equities,” the report said.
Over the next five years, in Qatar, private wealth held in equities is expected to increase at a compound annual growth rate (CAGR) of 15%, it said, adding in parallel, bonds will grow by 4.6% and cash and deposits will see a 6.1% jump.
“Interestingly, in terms of wealth distribution, private wealth held by ultra-high-net-worth (UHNW) households (those with above $100mn) in Qatar showed the highest growth rate in 2014,” Markus Massi, a Partner & Managing Director at BCG Middle East said. Private wealth in that segment rose by 10% in 2014, on the back of dynamic equity markets and a growing economy. Private wealth held by the UHNW segment is set to soar by an impressive 22.5% by 2019, he added.
In Qatar, the upper high-net-worth (HNW) segment (those with between $20mn and $100mn) grew by 9.3% in 2014, BCG said. With a projected CAGR of 9% over the next five years, this segment is expected to see continued growth, it said, adding “this will be triggered by both a large number of new households entering the segment and growth in average wealth per household.”
Private wealth held by the lower HNW segment (those with between $1mn and $20mn) was up 7.2% in 2014. It is forecasted to grow by 11.6% over the next five years, it said.
“The total number of millionaire households (those with more than $1mn in private wealth) in Qatar increased by 3.7 in 2014,” Massi said, adding “looking ahead, it will grow another 4.1% by 2019”.
BCG said private wealth in the Middle East and Africa region increased by more than 9% to nearly $6tn in 2014. With a projected CAGR of 9%, the region’s private wealth will rise to an estimated $9tn in 2019 with Saudi Arabia ($2tn) and the UAE ($1tn) as the largest markets.