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Visualizing the Wealth of Nations

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The Wealth of Nations (2018-2028F)

Visualizing the Wealth of Nations

Just as there exists a longstanding inequality in the distribution of household wealth, so exists a considerable differential in the amount of wealth held by countries on the international stage.

Simply put, some nations are “haves”, while many others are “have-nots”.

“Wherever there is great property, there is great inequality.”

– Adam Smith, The Wealth of Nations

Ranking Riches

We previously showed you how the ranking of the richest countries in the world has changed over the course of the last 10 years (2008-2018).

Today’s chart keys on a slightly different question.

What are the wealthiest nations today, both in absolute and per capita terms, and how is this list projected to change over the next decade? Let’s see how the wealth of nations stack up.

Private Wealth: Now and in the Future

Using data from the Global Wealth Migration Review, here are the 10 wealthiest nations both now and as forecasted in 2028.

RankCountryWealth (2018)Wealth (2028F)Approx. Growth
#1🇺🇸 United States$60.7 trillion$72.8 trillion20%
#2🇨🇳 China$23.6 trillion$51.8 trillion120%
#3🇯🇵 Japan$19.1 trillion$24.9 trillion30%
#4🇮🇳 India$8.1 trillion$22.8 trillion180%
#5🇦🇺 Australia$6.0 trillion$10.8 trillion80%
#6🇬🇧 United Kingdom$9.1 trillion$10.0 trillion10%
#7🇩🇪 Germany$8.8 trillion$9.7 trillion10%
#8🇨🇦 Canada$6.0 trillion$7.8 trillion30%
#9🇫🇷 France$5.9 trillion$6.4 trillion10%
#10🇮🇹 Italy$3.8 trillion$4.2 trillion10%

It’s worth noting that these figures are meant to represent wealth, which is defined as the total amount of private wealth held by individuals in each country. It includes assets like property, cash, equities, and business interests, minus any liabilities.

China has been the best performing wealth market in the last decade, and these projections show the country as continuing on that track. In fact, both China and India are expected to see triple-digit growth in private wealth between now and 2028.

As far as developed countries go, it’s not surprising that growth rates are much more modest. In Europe, countries like Great Britain, Germany, France, and Italy are only expected to add 10% to private wealth in 10 years, while Canada (30%) and the U.S. (20%) do marginally better.

One notable exception here is Australia, which is expected to add 80% to private wealth over the timeframe – and it will leapfrog both Germany and the U.K. in the rankings in the process.

Wealth per Capita

Here’s a look at the wealth of nations in a different way, this time with numbers adjusted on a per capita basis.

RankCountryEst. PopulationWealth per capita (2018)
#1🇲🇨 Monaco38,695$2,114,000
#2🇱🇮 Liechtenstein37,810$786,000
#3🇨🇭 Switzerland8,420,000$315,000
#4🇱🇺 Luxembourg590,667$300,000
#5🇦🇺 Australia24,600,000$244,000
#6🇳🇴 Norway5,258,000$198,000
#7🇺🇸 United States327,200,000$186,000
#8🇸🇬 Singapore5,612,000$177,000
#9🇭🇰 Hong Kong7,392,000$169,000
#10🇨🇦 Canada36,540,000$163,000

When using per capita numbers, it’s absolutely no contest.

Monaco, the city-state on the French Riviera, is a money magnet with $2.1 million of private wealth per citizen. This means the average Monacan is at least 10 times richer than the average North American or European.

Liechtenstein, a microstate that sits in the Alps between Switzerland and Austria, also has a high average wealth of $786,000 per person. Like Monaco, its population is well under 50,000 people.

Finally, it’s worth mentioning that three countries on the per capita list also made the overall list. Put another way, the countries of Australia, Canada, and the United States can all claim to be among the wealthiest of nations in both absolute and per capita terms.

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Interest Rate Hikes vs. Inflation Rate, by Country

Inflation rates are reaching multi-decade highs in some countries. How aggressive have central banks been with interest rate hikes?

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Interest Rate Hikes vs. Inflation Rate, by Country

Imagine today’s high inflation like a car speeding down a hill. In order to slow it down, you need to hit the brakes. In this case, the “brakes” are interest rate hikes intended to slow spending. However, some central banks are hitting the brakes faster than others.

This graphic uses data from central banks and government websites to show how policy interest rates and inflation rates have changed since the start of the year. It was inspired by a chart created by Macrobond.

How Do Interest Rate Hikes Combat Inflation?

To understand how interest rates influence inflation, we need to understand how inflation works. Inflation is the result of too much money chasing too few goods. Over the last several months, this has occurred amid a surge in demand and supply chain disruptions worsened by Russia’s invasion of Ukraine.

In an effort to combat inflation, central banks will raise their policy rate. This is the rate they charge commercial banks for loans or pay commercial banks for deposits. Commercial banks pass on a portion of these higher rates to their customers, which reduces the purchasing power of businesses and consumers. For example, it becomes more expensive to borrow money for a house or car.

Ultimately, interest rate hikes act to slow spending and encourage saving. This motivates companies to increase prices at a slower rate, or lower prices, to stimulate demand.

Rising Interest Rates and Inflation

With inflation rates hitting multi-decade highs in some countries, many central banks have announced interest rate hikes. Below, we show how the inflation rate and policy interest rate have changed for select countries and regions since January 2022. The jurisdictions are ordered from highest to lowest current inflation rate.

JurisdictionJan 2022 InflationMay 2022 InflationJan 2022 Policy RateJun 2022 Policy Rate
UK5.50%9.10%0.25%1.25%
U.S.7.50%8.60%0.00%-0.25%1.50%-1.75%
Euro Area5.10%8.10%0.00%0.00%
Canada5.10%7.70%0.25%1.50%
Sweden3.90%7.20%0.00%0.25%
New Zealand5.90%6.90%0.75%2.00%
Norway3.20%5.70%0.50%1.25%
Australia3.50%5.10%0.10%0.85%
Switzerland1.60%2.90%-0.75%-0.25%
Japan0.50%2.50%-0.10%-0.10%

The Euro area has 3 policy rates; the data above represents the main refinancing operations rate. Inflation data is as of May 2022 except for New Zealand and Australia, where the latest quarterly data is as of March 2022.

The U.S. Federal Reserve has been the most aggressive with its interest rate hikes. It has raised its policy rate by 1.5% since January, with half of that increase occurring at the June 2022 meeting. Jerome Powell, the Federal Reserve chair, said the committee would like to “do a little more front-end loading” to bring policy rates to normal levels. The action comes as the U.S. faces its highest inflation rate in 40 years.

On the other hand, the European Union is experiencing inflation of 8.1% but has not yet raised its policy rate. The European Central Bank has, however, provided clear forward guidance. It intends to raise rates by 0.25% in July, by a possibly larger increment in September, and with gradual but sustained increases thereafter. Clear forward guidance is intended to help people make spending and investment decisions, and avoid surprises that could disrupt markets.

Pacing Interest Rate Hikes

Raising interest rates is a fine balancing act. If central banks raise rates too quickly, it’s like slamming the brakes on that car speeding downhill: the economy could come to a standstill. This occurred in the U.S. in the 1980’s when the Federal Reserve, led by Chair Paul Volcker, raised the policy rate to 20%. The economy went into a recession, though the aggressive monetary policy did eventually tame double digit inflation.

However, if rates are raised too slowly, inflation could gather enough momentum that it becomes difficult to stop. The longer high price increases linger, the more future inflation expectations build. This can result in people buying more in anticipation of prices rising further, perpetuating high demand.

“There’s always a risk of going too far or not going far enough, and it’s going to be a very difficult judgment to make.” — Jerome Powell, U.S. Federal Reserve Chair

It’s worth noting that while central banks can influence demand through policy rates, this is only one side of the equation. Inflation is also being caused by supply chain issues, a problem that is more or less outside of the control of central banks.

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Mapping the Migration of the World’s Millionaires

This graphic maps out the migration of millionaires across the globe, showing the top 10 countries the ultra-rich are moving to and from.

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Mapping the Migration of the World’s Millionaires

Throughout 2022, a projected 88,000 millionaires will move to a new country, according to the latest Henley Global Citizens Report.

Which countries are these millionaires moving to, and where in the world are they coming from?

This graphic maps the migration of high net worth individuals (HNWIs)—people with a net worth of over US$1 million—showing where rich people are flocking, and where they’re fleeing.

Migration of Millionaires is Back

Before diving into the country-specific data, it’s worth taking a step back to look at overall millionaire migration trends, and how things are changing this year.

2020 saw a drastic drop in the number of millionaire migrants, as pandemic-induced lockdowns kept people from leaving their home countries—and at times, their homes in general.

But as restrictions ease and countries begin to open up their borders again, the migration of millionaires is beginning to gather steam once again:

Year# of HNWIs that migratedY-o-y change
2018108,00014%
2019110,0002%
202012,000-89%
202125,000108%
2022P88,000252%
2023P125,00042%

Below, we’ll dive into which countries are seeing the highest number of HNWI migrants, and which ones are losing the most HNWIs.

Which Countries Are Millionaires Leaving?

There are a plethora of reasons why the ultra-rich move countries. Escaping conflict is one of them, which is why it’s no surprise to see Russia and Ukraine are projected to see some of the biggest emigration numbers by the end of 2022.

Here are the top 10 countries by millionaire outflows:

CountryProjected net outflows of HNWIs (2022)% of HNWIs lost
🇷🇺​ Russia15,00015%
🇨🇳​ China10,0001%
🇮🇳​ India8,0002%
🇭🇰 Hong Kong3,0002%
​🇺🇦 Ukraine2,80042%
​🇧🇷​ Brazil2,5002%
🇬🇧​ UK1,5000%
🇲🇽​ Mexico8000%
🇸🇦 Saudi Arabia6001%
🇮🇩 Indonesia6001%

Figures rounded to the nearest 100.

While Russia is expected to see 15,000 millionaires leaving the country, Ukraine is projected to experience the highest loss in percentage terms—a whopping 42% of its HNWIs could leave the country by the end of 2022.

China could also see a big loss in its millionaire population, with a projected loss of 10,000.
According to Andrew Amoils, Head of Research at New World Wealth, this could be more damaging to the country than in previous years, since general wealth growth in China has declined recently.

Where Are The Ultra-Rich Moving?

The United Arab Emirates (UAE) has become a millionaire magnet, with a projected 4,000 HNWIs flowing into the country by the end of 2022. This influx of ultra-wealthy people is partly because of the country’s accommodating immigration policies that are specially tailored to attract private wealth and international talent.

Here are the top 10 countries that saw millionaire inflows:

CountryProjected net inflows of HNWIs (2022)% of HNWI Gained
​​🇦🇪​ UAE4,0004%
🇦🇺​ Australia3,5001%
🇸🇬 Singapore2,8001%
​🇮🇱 Israel2,5002%
​​🇺🇸 USA1,5000%
​🇵🇹​ Portugal1,3002%
🇬🇷​ Greece1,2003%
🇨🇦​ Canada1,0000%
🇳🇿​ New Zealand8001%

Australia continues to attract HNWIs, coming in second behind the UAE. According to New World Wealth, approximately 80,000 millionaires have moved to the Land Down Under in the last two decades.

A few things that attract migrants to Australia are the country’s low costs of healthcare, its lack of inheritance tax, and its generally prosperous economy.

Where does this data come from?

Source: Henley Global Citizens Report 2022

Data notes: As countries reopen, and the invasion of Ukraine wears on, this will have ripple effects on where people choose to live. There are two main things to keep in mind when view the information above. 1) Individuals need to remain in a country for six months in order to be updated in the database. In many cases, it’s not yet clear where people leaving certain countries choosing to relocate. 2) In the graphic above, we’ve visualized the top 10 countries for inflows and outflows.

 

Update: This article and graphic have been updated to more clearly explain what’s being shown, and list the data source in a more prominent way. We appreciate your feedback.

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