Published: Mon, October 29, 2018
Money | By Wilma Wheeler

China minted two new billionaires per week in 2017, says report

China minted two new billionaires per week in 2017, says report

According to UBS, 40 of the 179 new billionaires created previous year inherited their wealth-a trend that has driven an explosion of wealth inequality over the past several decades. "It's hard to become a billionaire through sheer organic growth". "But this is just the beginning", said Josef Stadler, head of ultra-high net worth at UBS wealth management.

A new report from investment bank UBS and professional services firm PwC has found the world's richest people upped their wealth by nearly a fifth in 2017, with British billionaires upping their income by a quarter.

The US still leads regionally, with 585 billionaires, but wealth creation in the region is slowing.

The top three industries where Chinese billionaires made their money are real estate, technology, and consumer and retail.

China's ultra rich are mostly "self-made" entrepreneurs, with some 97% building their own fortunes rather than gaining it through inheritance, compared with 69% in the USA, the report said.

The report forecast that, driven by China, billionaires in Asia-Pacific will be wealthier than their American counterparts within three years.

China is leading the world in billionaire-generation with two billionaires created every week, which accounts for 22% of the increase, or $315.8 billion, in billionaire wealth worldwide. In 2017, the United States created 53 new billionaires, compared with 87 five years ago.

Younger billionaires are the driving force behind a growth in philanthropy and sustainable investing, as they use their wealth to create positive social impact.

China produced 50 so-called "unicorns" - companies with a valuation of at least US$1 billion - from 2016 to 2018, slightly behind the 62 produced in the United States, the report said. "Supported by rapid urbanization and productivity growth, they are leveraging technology to revolutionize the country's service sector, as well as growing business in area such as AI and healthcare". "This cohort is overwhelmingly self-made and determined to capitalize on one of history's greatest moments for new enterprise".

"A major wealth transition has begun", the report continued. We have also found that Next Gen billionaires are extremely entrepreneurial. Last year, 106 new billionaires were created there - equivalent to over two new billionaires being minted each week. The younger billionaires are expected to drive the growth in philanthropy and sustainable investing; 38 per cent of family offices are now engaged in sustainable investing; 45 per cent aim to step this up over the next 12 months.

Total billionaire wealth in Singapore grew by 9 per cent to reach US$64.5 billion.

Billionaires are richer than before too, with their average net-worth sitting at $4 billion.

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