We’re the richest nation on earth, according to a Credit Suisse report
AUSTRALIANS are the world’s wealthiest people on a median basis and second in the world behind Switzerland on an average basis, according to a new report.
The Credit Suisse report also notes the European sovereign debt crisis is not expected to stop a new generation of millionaires emerging in the next five years, with the greatest wealth growth likely to occur in the booming Asia-Pacific.
On a median measure Australian adults are worth nearly $US221,704 ($217,559), nearly four times the amount of each US adult.
The proportion of Australian adults worth more than $US100,000 is eight times the global average.
The high wealth rate in Australia is attributed to the strong Australian dollar, property ownership levels and a robust labour market.
Australia also has one of the highest home ownership rates in the world, with property making up about 65 per cent of consumers’ wealth.
The Credit Suisse Global Wealth report shows worldwide wealth is estimated at $US231 trillion and is forecast to hit $US314 trillion by 2016, despite the current market upheaval.
The report says there are 27.9 million millionaires in the world, of which Australia accounts for 4 per cent.
Credit Suisse forecasts that number will reach 45.6 million in the next five years with the greatest growth to come from China. It is estimated that the world’s fastest-growing economy now has 1.01 million millionaires and that could rise to 2.4 million as the nation’s industrialisation and urbanisation continues.
Credit Suisse’s Asia-Pacific head of private banking, Marcel Kreis, said the current European crisis showed the world economy would need to rely on the emerging nations for future growth.
“These are times of unprecedented economic, social and political change,” he said.
“We are seeing a reshaping of the world economic order where the emerging markets will play a far more important role.
“If you look at Asia-Pacific rates, China has been strong for 10 years. The world is pinning its hopes on avoiding a mid-term recession on the ongoing positive fallout and developments in China and the Asian region.
“Twenty years ago, if the US hit recession or growth slowed then Asia would catch a cold and dip into recession.” Australia’s interest rates are widely divergent from Europe and the US, the higher rates here underpinning the strength of the Australian dollar and a reflection of Australia’s boom-time conditions. Now, an interest rate cut at the Reserve Bank’s November board meeting is considered a strong possibility.
“The household sector has been subdued for some time but that has been seen as making room for the investment in the external sectors, especially mining,” said Credit Suisse’s Australian strategist Adnan Kucukalic .
“The RBA is now weighing up and questioning whether the domestic economy could do with some help.”