Asia-Pacfic overtakes North America with largest number of HNIs, India & Hong Kong see sharp decline

MUMBAI: Asia-Pacific's high networth individuals (HNIs) population grew by 1.6% or twice the global population rate in 2011. It reached 3.7 million HNIs surpassing North America for the first time, according to Asia-Pacific Wealth Report by Capgemini and Royal Bank of Canada (RBC).

"Asia-Pacific's healthy gross domestic product ( GDP) growth and strong base of entrepreneurship helped the region overtake North America as home to the largest population of HNIs in the world," the report said.

Thailand led with a robust growth of 12.8 percent, followed by Indonesia at 8.2 percent, China at 5.2 percent and Japan at 4.8 percent. India and Hong Kong, which had led growth in the last two years, saw significant declines of 18 percent and 17.4 percent respectively, the report said.

Asia-Pacific had seven of the top 20 fastest-growing HNI populations globally in 2011, down from eight in 2010 and 14 in 2009.

While the wealth of Asia-Pacific's mid-tier and ultra-HNIs dropped in 2011 by 5.2 percent and 1.9 percent respectively due to their exposure to higher risk assets, the region's 'millionaires next door'saw increases in both their overall population (1.5 percent) and wealth (1.9 percent), it added, attributing it in part to Asia-Pacific's economy (excluding Japan), which continued to grow faster than other major regions. It posted 6.5 percent growth in GDP in 2011, compared with world GDP growth of 2.7 percent.

China and India, the emerging giants from Asia-Pacific, were key contributors to Asia-Pacific's wealth picture with GDP growth of 9.2 percent and 6.9 percent respectively in 2011 -- low rates by historical standards but better than those of other major economies.

"In 2011, Asia-Pacific experienced its share of economic challenges, as it dealt with the impact of the Eurozone crisis and slumping overseas demand and myriad domestic challenges, such as slumping property prices, policy paralysis and inflation. The region was also heavily exposed to international capital outflows," the report said, adding, China and India saw $1.60 billion and $4.09 billion foreign institutional investor (FII) funds leave their markets.