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There are now just 135,200 individuals with a wealth of USD 1 million or more, an 8% decline from 2013. Along with the continent’s 342 cent millionaires and 21 billionaires, those individuals have a total wealth of USD 2.5 trillion, the consultancy found.
According to a report by the consultancy company Henley & Partners, the number of millionaires living in Africa dropped by nearly 20,000 in the past decade. The reason for the drop in numbers, it is pointed out, is due to large-scale migration and dramatic currency depreciations that erode their wealth.
There are now just 135,200 individuals with a wealth of USD 1 million or more, an 8% decline from 2013. Along with the continent’s 342 cent millionaires and 21 billionaires, those individuals have a total wealth of USD 2.5 trillion, the consultancy found.
Currency depreciation and underperforming stock markets have chipped away at Africa’s wealth compared to global benchmarks, the report says. With African stock markets underperforming against global peers, local property markets facing headwinds. Currencies are depreciating against the dollar. That led to African investors’ wealth getting eroded on multiple fronts.
Africa’s economies have faced multiple challenges over the past decade that have put strain on their budgets and currencies. These included COVID-19 to rising interest rates to geopolitical tensions. South Africa, which has more than twice as many wealthy individuals as any other African country, has lost 20% of its millionaires in the last 10 years. The country faced logistics constraints, rolling blackouts, and endemic crime and corruption. During that time, the South African rand has fallen 43% against the greenback and the FTSE JSE All Share Index has also trailed the S&P 500.
Egypt and Nigeria, which are home to the next highest number of rich people after South Africa, have been grappling with runaway inflation, foreign exchange shortages, and multiple currency devaluations to allow their local units to trade more freely.
Despite all the challenges, Africa’s millionaire population is expected to rise by 65% in the next decade, according to the report. The gains will be driven by a surge in wealth in Mauritius, Namibia, Morocco, Zambia, Kenya, Uganda, and Rwanda, which are all expected to experience at least 80% millionaire growth, the report said.
Mauritius, with its stable governance and favorable tax regime, is projected to experience a remarkable 95% growth rate, positioning it as one of the world’s fastest-growing wealth markets,” the report said. “Namibia, too, is poised for impressive high-net-worth growth.
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Nigeria’s economy, which ranked as Africa’s largest in 2022, is set to slip to fourth place this year and Egypt, which held the top position in 2023, is projected to fall to second behind South Africa after a series of currency devaluations, International Monetary Fund forecasts show. The IMF’s World Economic Outlook estimates Nigeria’s gross domestic product at USD 253 billion based on current prices this year, lagging energy-rich Algeria at USD 267 billion, Egypt at USD 348 billion and South Africa at USD 373 billion.
Africa’s most industrialized nation will remain the continent’s largest economy until Egypt reclaims the mantle in 2027, while Nigeria is expected to remain in fourth place for years to come, the data released this week shows.
Egypt, one of the emerging world’s most-indebted countries and the IMF’s second-biggest borrower after Argentina, has also allowed its currency to float, triggering an almost 40% plunge in the pound’s value against the dollar last month to attract investment.
