June 29, 2007
In S'pore: 11,660 new millionaires
By Alvin Foo
SINGAPORE'S population of United States dollar millionaires surged by a staggering 21.2 per cent last year to 66,660 - the fastest growth rate of any nation in the world.
The dramatic boost in the membership of this once highly exclusive club came amid a booming stock market, strong economy and the start of the property rebound last year.
This is the second time in three years that the Republic has posted the highest growth globally in the annual World Wealth Report compiled by Merrill Lynch and research firm Capgemini.
About 11,660 newly minted millionaires joined the ranks here last year, the survey of the well-to-do in 71 countries has found. A million greenbacks currently converts to about S$1.54 million.
'Singapore is a little boat of 4.5 million people that floats very nicely when the global economy is doing well,' said Merrill Lynch's chief Asia strategist and senior director Mark Matthews yesterday. 'The country's growth has accelerated - not only economic growth, but also savings.'
The 66,660 millionaires account for about 1.5 per cent of the population. This means three out of every 200 people here are millionaires.
To qualify, these well-heeled types must have a million bucks in assets not counting that widely used barometer of wealth - the home. Other investments in real estate are included.
Singapore was followed closely by India with 20.5 per cent growth, Indonesia (16 per cent) and Russia (15.5 per cent). Asia was home to some of the fastest-growing millionaire markets, occupying five out of the top 10 spots - a repeat of 2005.
The number of millionaires in the region pushed their combined wealth up 10.5 per cent to US$8.4 trillion. This was largely driven by strong expansion of the China and India economies, robust foreign direct investments and growing confidence in Asia.
In 2005, Singapore ranked eighth, having posted 13.4 per cent growth. It also took top spot in 2004 with a 22.4 per cent rise.
Last year, the main driver of this growth came from the increase in the total value of stock market shares, up 49.3 per cent after an 18.3 per cent rise in 2005. Other factors included low inflation, low taxes and a rise in savings.
The report also showed that wealthy investors worldwide had shifted more money into property, lured by high returns from commercial real estate investments. This was most evident in the Asia-Pacific, with 29 per cent of assets of the wealthy held in property, up from 16 per cent a year earlier.
Mr Matthews said the biggest threat to this boom in wealth would be an unexpected slowdown in the Chinese economy.
Here, the growth in the ranks of millionaires is expected to continue this year, as property prices surge and more expatriates make Singapore home, industry experts say.
Said CIMB-GK economist Song Seng Wun: 'The en bloc sales have made some people instant millionaires.'
Added Mr Ku Swee Yong, director of marketing and business deve- lopment at Savills Singapore: 'This growth is not surprising, given the rise in the equity market.
'I expect more middle and senior management executives to join the millionaire ranks this year, as the equity market continues to surge.
'The expansion of the private wealth business here is expected to continue, and we'll see more wealthy people relocating here as a result.'
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