While Thailand’s millionaires increased their wealth by more than 11% last year, they’re being blown away by Southeast Asian neighbours who are riding strong economies to boost their incomes by triple digits.
A man runs past the Gucci logo displayed outside the Central Embassy luxury mall in Bangkok, Thailand. While Thailand’s millionaires increased their wealth by more than 11% last year, they’re being blown away by Southeast Asian neighbours who are riding strong economies to boost their incomes by triple digits. (Bloomberg photo)
The kingdom's high-net-worth individuals, defined as those with investable assets of at least $1 million, increased their wealth 11.2% from a year earlier to $396 billion, according to a report released today by Royal Bank of Canada and Cap Gemini SA. The number of millionaires in Thailand rose 9.2% to 80,000 while "ultra" high-net-worth (UHNW) individuals edged up just 2% to 527, it said.
By comparison, Vietnam and Indonesia ranked first and second in the world for increases in the number of UHNW individuals, posting growth of 166% and 144%. And, among "ordinary" millionaires, Japan came in first in the region increased their wealth 24% from a year earlier to $5.5 trillion.
A chart by Royal Bank of Canada and Cap Gemini SA shows the growth of high-net-worth individuals in Thailand over the years.
China's millionaires expanded their wealth at the second- fastest pace in the region, the report showed. Their riches increased 20% to $3.8 trillion, as the number of high net-worth individuals in the nation expanded 18% to 758,000.
Countries showing the greatest wealth growth have one thing in common: free and strong economies. In Japan, the country's benchmark Topix Index of stocks jumped 51% last year on unprecedented monetary easing by the Bank of Japan as Prime Minister Shinzo Abe rolled out his package of growth measures known as "Abenomics." This year, the index lost 8% as investors speculate his campaign is running out of steam and look ahead to a second sales tax rise next year after an increase in April dented consumption.
"While equity-market performance across Asia-Pacific was mixed in 2013, strong economic growth and real estate prices in key markets drove healthy overall wealth growth," M. George Lewis, group head of RBC's wealth-management and insurance units, said in a statement today.
Thailand's economy grew just 1.8% in 2013 and contracted in the first quarter of this year. It increased just 0.9% in the second quarter. The Stock Exchange of Thailand, however, has gained 22% in 2014, though most of that growth has only come since the May 22 coup. The Asian Development Bank last month characterised Thailand as the weakest among the "Asean 5" economies which also include Indonesia, Malaysia, the Philippines, and Singapore.
The Asia-Pacific region's total population of millionaires increased 17% to 4.3 million, compared with a global growth rate of 13%, the report showed. Their wealth expanded 18% to $14.2 trillion, compared with 12% for the rest of the world.
Billionaire Charoen Sirivadhanabhakdi, chairman of Thai Beverage Plc (second left) looks at his wife Wanna Sirivadhanabhakdi, non-executive vice chairman of Fraser And Neave Ltd (second right) during a charity event in Bangkok on Oct 15. Mr Charoen is Thailand’s richest man with a $12.7 billion fortune, according to the Bloomberg Billionaires Index. He controls an empire whose businesses span industries from beer to property development. (Bloomberg photo)
"Asia-Pacific is expected to continue to lead global growth and pass North America as the region with the highest high net-worth individual population by the end of 2014 and the greatest high net-worth individual wealth by 2015."
Looking forward, the report expects Thailand to add nearly 300 UNHW individuals, up 52%, by 2023, while the number of "centa-millionaires" with $100 million or more to invest, will increase 52% from the current 203 to 309 by 2023. The kingdom post 148% growth in the same category from 2003-2013.
As for billionaires, Thailand currently has 15 with a $1 billion available to invest, up from six a decade ago. By 2023, RBC predicted there will be 23, a 53% increase.
The growth in the number of millionaires in Japan and China accounted for 85% of the total increase in Asia, RBC and Cap Gemini said. The data cover people with investable assets of at least $1 million, excluding primary residence, collectibles, consumables and consumer durables.