Prevailing economic and social realities in Nigeria have affected the growth of wealth held by private individuals. Total personal wealth in the country experienced a 27% decline in the last ten years.
This retarded growth was attributed to factors such as the ease of doing business, the rate of taxes charged on businesses, social and political safety, and the growth of financial services.
The 2022 edition of the Africa Wealth Report revealed the decline
At the top of the rankings are countries not considered economic powers in the continent, taking the top five spots on the rankings. Mauritius recorded a 74% growth in first place, while Rwanda, Ethiopia, Uganda, and Kenya completed the top five.
The impressive growth rate recorded by Mauritius was due to its conducive business environment. The country ranked first in Africa and 13th globally in the ease of doing business ranking. Taxes in the country are low, which encourages businesses to thrive. Also, the country is rated as the safest country in Africa by the New World Wealth. With all these in place, businesses are enhanced by a fast-growing local financial services sector and stock market.
However, the business environment in Nigeria is quite problematic and is ranked 131st globally. This, coupled with other factors such as political instability, issues of insecurity, and high taxes, has seen private wealth growth decline over the last ten years.
Mauritius has the highest per capita income of wealthy persons in the continent. This is due to the strong growth of a large millionaire pool as there has been a relocation of wealthy individuals to the country. Also, the locals continue to improve their status financially, increasing their wealth.
However, Nigeria, regarded as the wealthiest country in Africa due to its $480 billion GDP, has low wealth per capita. The country was not in the top 10 countries but occupied the 11th position with $1100 per capita.
Generally, the total wealth held by private individuals in Africa increased in 2021 after dropping in 2020. The Africa Wealth Report revealed that private individuals in the continent had a total pool of $2.1 trillion by 2021. This increased from the $2 trillion held by the end of 2020.
However, the figure is lower than the 11-year average of $2.21 trillion held by Africa’s wealthiest individuals from 2011 to 2021. Also, the highest amount held in any year was in 2012, when $2.4 trillion was the total wealth held by individuals in Africa.
By the end of 2021, the Highest Net Worth Individuals (HNWIs) in the continent was 136,000. These are persons with a minimum of $1 million and above in assets.
Of this number, 6,700 are multi-millionaires with assets worth $10 million and above. The number of individuals dropped to 305 in the centi-millionaire category (those with assets worth greater than or equal to $100 million). Those with a net worth of $1 billion or more in assets are just 21 within the continent.
The country ranking shows that South Africa has the highest pool of wealthy individuals. The country has $651 billion in private wealth held by 39,300 individuals.
Egypt is in second place with $307 billion as the total wealth held by private individuals totaling 16,900. Egypt, however, has the highest number of billionaires in Africa. The country has seven billionaires within its territory.
Nigeria occupies third place with a total private wealth of $228 billion. This wealth is held by 10,000 Nigerians.
The other countries in the top five are Morocco, with a total wealth of $125 billion, and Kenya, with $91 billion.