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KUALA LUMPUR, Dec 9 — Malaysia’s largest city Kuala Lumpur has the highest number of millionaires (denominated in US dollars) surpassing all other cities of the world, according to a report by international wealth research group WealthInsight.
The city had 13,800 millionaires or high net worth individuals (HNWIs) in 2013, higher than Abu Dhabi’s 12,500, Cape Town’s 8,753 or Birmingham’s 8,736, WealthInsight said.
The number of millionaires concentrated in Kuala Lumpur gives an indicator of Malaysia’s fast-growing wealth at the top end but also suggests an increasing gap between the richest and the rest of the population.
Average annual income in the country stands around RM20,000 and minimum wage weighs in at RM900 a month.
WealthInsight predicted that Malaysia’s number of millionaires will jump from over 26,000 last year to 30,054 in just four years, with total Malaysian wealth also projected to increase from US$151 billion (RM527 billion) to US$206 billion (RM719 billion) in the same period.
“Malaysian wealth grew at the remarkable rate of 59.6 per cent between 2009 and 2013 and is expected to increase by a further 28% to reach US$206 billion in 2018,” said the group which claims to have a detailed database on the rich and an international-based team of over 500 economists, analysts and researchers.
WealthInsight analyst Tom Carlisle cited the well-performing Malaysian economy during the financial crisis as the reason for the 45.5 per cent hike in new millionaires minted during the 2009 to 2013 period to the total pool of 26,105.
“Since becoming an Islamic banking hub, Malaysia has seen a large surge in investment to its shores, increasing by 52.6 per cent since 2008 to US$11.6 billion. Malaysia has also seen a large increase in HNWIs acquiring their wealth in finance as well as in real estate and construction, increasing by 64.8 per cent, 57.2 per cent and 55.1 per cent respectively”, says Carlisle.
“Malaysian HNWIs are currently investing 54% of their overseas portfolio in the Asia-Pacific,” Carlisle said, adding that the Malaysian millionaires’ wealth had grew through investment in real estate which would be influenced by the high economic growth expected over the next five years.
Malaysia is also predicted to have more billionaires (20) in 2018 compared against oil-rich United Arab Emirates (19), WealthInsight said in its report titled “Millionaires in Malaysia: 26,000 and Counting”.
The leading source on the rich and ultra-rich pointed out that Malaysia’s overall wealth was similar to countries with larger populations, including Argentina’s US$160 billion, Colombia’s US$154 billion and Indonesia’s US$206 billion.
“With a population of only 28.3 million, Malaysia has a similar number of millionaires than much more densely populated countries such as Indonesia, whose population stands at 237.6 million.
“This demonstrates the big potential for billionaire growth in Malaysia,” Carlisle said.
Currently, Malaysia’s billionaires have 209 per cent more wealth than Paraguay’s entire millionaire population, with the growth of Malaysian billionaires last year standing at US$46 billion, WealthInsight said.