Malaysia lags region in millionaire stakes

 

KUALA LUMPUR, Oct 1 — Malaysia does not appear on Merrill Lynch’s latest ranking of top millionaire-creating countries in the Asia-Pacific region but is lumped instead in the “others” category with other minor markets such as Pakistan and Myanmar.

Malaysia’s grouping in the “others” category of the Merrill Lynch Capgemini 2010 Asia Pacific Wealth Report on high net worth individuals (HNWI) released this week contrasts sharply with its strong position in terms of the number of billionaires that it boasts, suggesting that its system is skewed towards the super-rich rather than mass wealth.

Forbes magazine rankings show that Malaysia has nine billionaires, the eighth highest in Asia — including the world’s 33rd and 89th richest — Tan Sri Robert Kuok and T. Ananda Krishnan. In comparison Japan, which has by far the most number of millionaires in Asia, has only 22 billionaires.

The other countries that make up the “others” category of the Asia Pacific Wealth report include New Zealand, Kazakhstan, the Philippines, Sri Lanka and Vietnam.

The “others” group (estimated population 480 million) collectively saw their number of US dollar millionaires grow 11.1 per cent to 154,000 in 2009 compared with a whopping 104.4 per cent in Hong Kong to 76,000, 32.7 per cent in Singapore to 82,000, 42.3 per cent in Taiwan to 83,000, 50.9 per cent in India to 127,000, 34.4 per cent in Australia to 174,000, 31 per cent in China to 477,000 and 20.8 per cent in Japan to 1.7 million.

As a group, the “others” saw their HNWI wealth grow 11.6 per cent to US$749 billion (RM2,322 billion) compared with 22. 4 per cent in Japan to US$3.9 trillion, 40.4 per cent in China to US$2.3 trillion, 36.7 per cent in Australia to US$519 billion, 53.8 per cent in India to US$477 billion, 108.9 per cent in Hong Kong to US$379 billion and 35.6 per cent in Singapore to US$369 billion.

An analysis by the Boston Consulting Group released in June also shows that Singapore has the highest percentage of millionaire households in the world at 11.4 per cent, followed by second place Hong Kong and third place Switzerland.

Malaysia’s city state southern neighbour is also now vying with Switzerland to become the wealth management capital of the world.

The Merril Lynch report said that Asia Pacific HNWIs had 27 per cent of their assets in equities and 26 per cent in real estate at the end of 2009 compared with 23 per cent and 22 per cent respectively in 2008.

“By 2011, Asia-Pacific HNWIs’ allocations to equities and fixed-income instruments are expected to increase and relative holdings of cash-based and real-estate holdings are expected to decline as HNWIs seek to rebalance their portfolios,” said the report. “Home-region allocations are expected to decline as Asia-Pacific HNWIs pursue returns and opportunities elsewhere, especially in the emerging markets of Latin America and Africa.”

The report defines HNWIs as those with investable assets of at least US$1 million.