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Sunday, July 1, 2012
Asia richer than ever — or is it?
Asian millionaires have surpassed North American millionaires for the first time ever, according to a study by Capgemini consultancy and the Royal Bank of Canada. The Asia-Pacific region now has 3.37 million so-called high-net-worth individuals, calculated in terms of the number of people with over $1 million in investible assets.
That edged out the 3.35 million in North America. Asia had already edged out Europe in the number of millionaires in 2010.
China's ongoing economic boom churned out 562,000 millionaires in 2011, the fourth-highest number after the United States, Japan and Germany. While India and Hong Kong saw a downturn in the numbers of millionaires, the figures in China, Japan, Thailand, Malaysia and Indonesia all increased considerably.
Despite the 3/11 disasters and general economic downturn, Japan managed to show 4.8 percent more millionaires last year, due in part to conservative investments and high savings.
Of course, many of those with increasing wealth are really multimillionaires. Details on how the ultrarich spend their money in these investment reports focus on the future of markets in real estate, luxury brands, high-end travel, and auctions of everything from wine to art. Those purchases seem to indicate that the wealth of Asia's millionaires is becoming more fully established and diversified, as well as more sophisticated.
However, it also indicates again that Asia is an area of the world with an increasingly vast gap between rich and poor.
According to reports by the World Bank, Southeast Asia, with a population of 1.3 billion, is home to approximately half of the world's poor. Roughly 85 percent of the population lives on less than $2 a day. The roughly 2 billion people in Eastern Asia and the Pacific are slightly better off. About 50 percent of the population there lives on less than $2 a day.
Those figures, especially for East Asia, show some degree of progress from the past, but are far from enough. The U.N. Food and Agriculture Organization classified 578 million people in Asia and the Pacific as hungry or undernourished in a 2010 report.
Putting the two trends together — more people with $1 million in assets and more people suffering from poverty and hunger — reveals that the rich-poor divide is greater than ever before in Asia.
Asia's millionaires might be proudly celebrating their assent to the ranks of the world's wealthy after reading these reports. Certainly, the shift indicates a very different distribution of wealth around the globe than ever before.
But the pattern of wealth distribution within each country's economy is one that remains in more dire need of change.