DOHA: Qatari households’ estimated net investable assets touched $153bn-$172bn range in 2014. As segment distribution of the assets shows the ultra high- net worth individual households together hold $68bn-$72bn in total. The high net worth individual households’ assets range between $65bn and $75bn.
The combined assets of lower tier “Affluent” households are something between $20bn and $25bn.
The investable assets generally are savings and liquid investments excluding consumer debts.
Strategy& (formerly Booz & Company), a global team of practical strategists, estimates that today there are between 1.5 million and 1.6 million wealthy households in the GCC with total investable assets of around $2.2 trillion
“We define ‘wealthy’ as any household with stable investable assets of more than $200,000 on an annual average basis. Affluent or mass-affluent clients are included in this definition. The high-net worth bracket begins at $1m of investable assets, while the ultra-high-net worth segment threshold is at $50m”, it said in its latest report on GCC’s private banking.
The data compiled by Strategy& suggests there has been a rapid growth in affluent household number in Saudi Arabia and UAE. During the last four years Qatar witnessed a 7 percent jump in the total number of “affluent” households.
Powerful macroeconomic and socio-demographic forces are propelling the growth of wealthy households in the GCC. One driver has been the strong rebound in global equity markets. From 2009 to 2013, global equities saw 50 percent gains. Besides these global equity trends, GCC-specific drivers accounted for the other 60 percent of the $1 trillion in net new wealth. From 2009 to 2013, GCC regional GDP grew steadily at an average rate of 10 percent per annum as the oil price rose and then was sustained at near-record levels.
Governments have used this windfall to spend generously on mega projects, infrastructure, and job creation — all of which helps to produce more income for wealthy individuals and create a generation of newly affluent citizens and expatriates.
Concurrent with this macroeconomic and socio-demographic growth have been geopolitical events that intensified the migration of new wealth to the region. Since the start of the Arab Spring and in its aftermath, the security and economic situation in countries such as Egypt, Iraq, Libya, Syria, and Tunisia has deteriorated. And many wealthy households from these countries migrated to the more stable GCC countries. The UAE has benefited from this regional phenomenon the most.
In addition, sluggish macroeconomic growth in the Western hemisphere, paired with turmoil in the international financial services industry due to operating failure scandals, regulatory fines, compliance issues, and strategic retrenchments, has contributed to some degree of capital being reallocated to its countries of origin, including the GCC.
