New Young Wealthy African Class

Rappers Wizkid and Banky W at private jet terminal in Lagos. Photo:

Rappers Wizkid and Banky W at private jet terminal in Lagos. Photo:

A huge inflow of capital from all parts of the world into Africa has helped create a new class of super wealthy Africans and there’s no sign it will stop anytime soon says Peter Welborn, chairman of UK-based real estate firm Knight Frank Africa. Entrepreneurship, innovations and investments from North America, Europe, China and the Gulf are increasing the population of super wealthy individuals in Africa faster than the global average, according to the Knight Frank Wealth Report 2016.

The proportion of super rich Africans is expected to increase by 54 percent from 2015 to 2025 compared to the global average of 41 percent in the same period, Shanghai Daily reported.

An ultra high net worth individual is defined as having investable assets of $30 million plus. Here’s how the classes break down, according to Investopedia:

The high net worth “club” is $1 million in liquid financial assets. An investor with less than $1 million but more than $100 000 is considered to be “affluent”, or perhaps even “sub-HNWI”. The upper end of HNWI is around $5 million, at which point the client is then referred to as “very HNWI”. More than $50 million in wealth classifies a person as “ultra HNWI”.

Angola, Egypt, Kenya, South Africa and Nigeria have the highest population of high-net-worth individuals, according to the Frank report.

“There is real optimism from external investors on Africa’s potential,” Well-born said.

“They are forging joint ventures with local players to grow businesses that have unleashed wealth among the middle and upper classes.”

An estimated 200 Kenyans became millionaires in 2015, according to the report. The country is now home to 8,500 dollar millionaires.

Africa’s new rich are younger and hipper than their predecessors, according to a report in Bloomberg, which also referred to the Knight Frank Wealth Report 2016.

“The profile of a rich African is shifting from older white-haired males to younger, hip millennial who have found new ways to make and keep money in a changing global scene,” according to the report.

Younger, better educated people are joining the super-rich African club and they’re bringing fresh, non-traditional ways of growing and spending their money, said Andrew Shirley, editor of the report, at a press conference in Nairobi, Bloomberg reported. In a continent with challenging transportation, more ultra-rich Africans are buying jets, Shirley said.

Ultra high-net-worth individuals have revitalised the African real estate and luxury goods market, the report said.

They’ve invested heavily in luxury homes, private jets, cars, bonds and equities.

“Homes comprise an estimated 22 percent of assets owned by Africa’s super wealthy and they have allocated 33 percent of their portfolios to liquid investments such as bonds and equities,” according to Shanghai Daily.

Collectibles such as wine, art, antiques, jewellery and classic cars are expected to gain popularity among Africa’s ultra wealthy in the coming decade.

Executives say they’re optimistic about wealth creation continuing in Africa despite risks associated with insecurity, global inflationary pressures, climate change and political uncertainty, according to the report.

By 2025, it’s predicted there will be 3 933 ultra-wealthy people on the continent compared to 2 650 in 2015, according to the Knight Frank Wealth Report 2016. —

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  • Panyanga

    Why are there no mentions of any Zimbabweans? More sanctions?

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