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Asia Today ISSN 1861-4604 Friday, December 15, 2017

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Allianz launched Global Wealth Report 2013

Total global financial assets brought up to a new record level of EUR 111 trillion.

Share on Facebook September 26, 2013, Reporter : Allianz, Reader : 430

Michael Heise, Chief Economist at Allianz news

Allianz has launched the fourth edition of its annual publication "Global Wealth Report", which analyzes the situation of assets and debt of private households in more than 50 countries

According to the report conclusions, overall gross financial assets of private households increased by 8.1% in 2012. It is the most pronounced increase in the last 6 years and is well above the multi-year average (2001-2012) of 4.6% per year after adjusting for the effects of currency exchange rates.

One of the main factors driving growth last year was the positive trend on the stock markets: assets held in securities swelled by 10.4%. This brought total global financial assets up to a new record level of EUR 111 trillion.

At the same time, debt growth (including mortgage debt) remained subdued at 2.9% in 2012, the fourth year after the Lehman collapse. The global debt ratio (liabilities expressed as a percentage of GDP) dropped by another percentage point to 65.9%, compared with 71.6% in 2009. This meant that global net financial assets (gross financial assets less liabilities) actually witnessed double-digit growth of 10.4%. All regions benefited from this strong growth. Even in the crisis-ridden eurozone, net financial assets climbed by 7.2% –  not least thanks to stagnating liabilities – putting them back above the pre-crisis value for the first time at the end of 2012.

But the positive development seen last year is not enough to paper over the deep cracks in private asset balance sheets in the euro area. The wealth gap is getting wider and wider. Average net financial assets in Greece now come in at only 28% of the eurozone average; before the crisis hit, this figure was still well above the 50% mark. In Spain, the figure slipped from 61% to 44% last year. "The growing wealth gap in the eurozone is an upshot of the crisis," said Michael Heise, Chief Economist at Allianz. "If this gap between north and south widens further it could undermine European cohesion. The reform drives to date are starting to bear fruit this year. Further resolute steps towards integration are needed in order to give all Europeans a clear prospect of growth and prosperity again." 

The global wealth middle class is growing and becoming increasingly Asian

The analysis of how assets are distributed within the individual countries is even more revealing than the asset distribution by country. After all, it is not countries, but rather their citizens, who are rich or poor, climbing up or down the wealth ladder. This is why we have defined global wealth classes, as in previous years. The global wealth middle class, based on the average global net per capita financial assets, encompasses all individuals with assets of between EUR 4,900 and EUR 29,200 in 2012.

Based on this breakdown, around 860 million people with medium net financial assets lived in the countries included in our analysis in 2012, almost 140 million people more than a year before. Much of this growth is due - in addition to general population growth - to China. This means that, on the whole, 18% of the world’s total population belonged to the global wealth middle class in 2012 (2011: 15%).  more…

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