Global Wealth Report 2024: Keys and Trends
The Global Wealth Report 2024, which analyzes the trends and dynamics impacting the global economy, is now available, and here are the highlights.
Recovery since 2022
2023 marked a positive change in global wealth, recovering from a drop in 2022. Global wealth increased by 4.2% in USD terms, thanks to the EMEA (Europe, Middle East and Africa) region, which grew by 4.8%. This recovery is due to the stabilization of global markets, the post-Pandemic economic recovery and an improved investment climate in key regions.
Wealth Distribution
Over the past two decades, the distribution of wealth has changed dramatically. The proportion of individuals with wealth below USD 10,000 has halved, while the highest levels of wealth have increased significantly.
What does this mean? The trend indicates that more and more people are achieving higher levels of wealth, reflecting an increase in the value of assets in various markets. However, global wealth inequality shows different dynamics:
- North America has experienced a slight decrease in inequality.
- In contrast, certain parts of Asia and Eastern Europe have seen increases in inequality.
This change in the distribution of wealth is a key indicator of global economic and social dynamics.
Regional Performance
- Asia-Pacific: Continues to show the fastest growth in wealth, driven by rapid economic expansion and the rise of the middle class. However, this growth is accompanied by rising levels of personal and corporate debt, raising concerns about sustainability.
- North America: Especially in the United States, wealth growth has been robust due to strong stock market performance and high real estate values. Wealth inequality has seen a slight decline since 2008, thanks to various socioeconomic policies.
- Western Europe: Shows mixed economic performance. Countries such as Germany and Switzerland continue to see a significant increase in wealth, while others face economic stagnation due to challenges such as political instability and a slower post-Pandemic economic recovery.
Inflation and Exchange Rate Effects
In 2023, inflation-adjusted real wealth growth reached 8.4%, highlighting significant gains compared to the previous year.
What drove this growth? Primarily, lower global inflation rates played a crucial role. In addition, currency fluctuations had a major impact, affecting wealth performance in countries such as Japan and the United Kingdom.
This real and inflation-adjusted growth underlines market resilience and recovery capacity.
Deceleration Trend
The report reveals a gradual deceleration in global wealth growth from an annual average of 7% between 2000 and 2010 to just over 4.5% between 2010 and 2023.
Why is this happening? Primarily due to market saturation in developed economies and economic volatility in emerging markets.
However, there is good news: the number of top wealth individuals is projected to increase significantly by 2028, with emerging markets accounting for nearly 32% of global wealth. This projection is based on continued economic growth and rising asset values in these regions.
In addition, a significant transfer of wealth is anticipated over the next two to three decades, with USD 83 trillion (trillion in U.S. values) expected to be transferred. A substantial amount of this wealth will be passed between spouses before reaching the next generation.
Distribution of global wealth by region in 2023
Source: UBS