In a recent report by Henley & Partners, 2022 Africa Wealth Report published in partnership with New World Wealth, it shows that the African continent holds USD 2.1 trillion (0.5% of the aggregate global wealth of 463.6 trillion) and is projected to grow by up to 38% within the next decade. According to Knight Frank’s Wealth Report, the number of multi-millionaires in Africa will grow at a faster rate than anywhere else in the world over the next 10 years. The negative impact that the COVID-19 pandemic had on private wealth and HNWI (High Net Worth Individual) wealth in Africa caused a drop in levels by up to 9% in 2020. African HNWIs are already on the path to recovery, total private wealth held in Africa is expected to hit USD 2.6 trillion by 2030. This will be on the back of rapid growth witnessed in the billionaire and centi-millionaires segments, particularly in the following fast growing economies; Ethiopia, Mauritius, Rwanda, Kenya and Uganda (AfrAsia Wealth report, 2021).
There are currently 136,000 high-net-worth individuals (HNWIs) with private wealth of USD 1 million or more living in Africa, along with 305 centi-millionaires worth USD 100 million or more, and 21 US dollar billionaires. Notably, out of the 54 countries on the continent, 50% of total continental wealth is concentrated in only 5 countries referred to as ‘The Big 5’. These countries are South Africa, Egypt, Nigeria, Morocco and Kenya, research and wealth reports show. However, Mauritius although not numbered with The Big 5, remains the wealthiest country in Africa, in terms of wealth per capita (average wealth per person) at USD 34,500 and not by number of HNIs or total aggregate wealth. The number of HNWIs in Mauritius is projected to exceed 8,000. Following Mauritius in the ranking by wealth per capita is South Africa at USD 10,970 and third is Namibia at USD 9,320. In Q3 2020, the World Bank officially classified Mauritius (a small island nation of 1.27 million people, cradled in the Indian Ocean approximately 2,000 km off the south east coast of Africa) as a high-income country. Mauritius is now referred to by wealth managers as the Indian Ocean Powerhouse.
Despite a tough past decade, South Africa is still home to over twice as many HNWIs as any other African country 39,300 with aggregate wealth of 651 billion USD, while Rwanda is 17th on the list with 700 HNWIs holding aggregate wealth of 11 billion USD. In a comment, the CEO of MyGrowthFund Venture Partners Vusi Thembakwayo speaking to the rising of new wealth economies and the disruption leading to the diversification into new sources of wealth-creation, reckoned it an exciting trend driving the creation and flow of capital across the continent and challenging the preexisting narratives. He also described Africa’s Wealth as having a polar domination, with the largest wealth centers in the most extreme south — South Africa — and the most extreme north — Egypt and Morocco. The rise of the Big 5 which can also be referred to as the new frontier economies is a trend to be observed.
The wealthiest cities in Africa according to the report by AfrAsia Bank, (2022) are Johannesburg, Cape Town, Cairo, Lagos and Durban. Johannesburg has a total private wealth of 239 billion USD, while Cape Town has total private wealth of 131 billion USD. Cairo with 128 billion, Lagos and Durban are in 4th and 5th positions with 97 billion USD and 60 billion USD respectively in private wealth.
South Africa is known as home to the biggest luxury market in Africa by revenue, followed by Kenya and Morocco. South Africa’s luxury sector’s annual revenue is approximately 2 billion USD making it by far, the largest on the continent, mostly from the sale of luxury foreign brands.
In 2021, Nigeria ranked as the largest economy in Africa with a total GDP of $440.78 billion, followed by South Africa and Egypt with GDP estimates of $419.9 billion and $404.1 billion respectively. However, despite being the largest economy on the continent with a huge population size of over 200 million, Nigeria ranked 17th in terms of per capita. The general interest and appeal for investment migration by affluent families is for the benefits they hold, ranging from domicile diversification to global mobility enhancement, to accessing world-class education and healthcare, to having a plan B in times of uncertainties and turmoil. Many sub-Saharan countries are doubly disadvantaged, being among the most vulnerable to climate change as well as having poor global mobility, with their passports ranking consistently low on the global mobility metric, passport index as stated by Chidinma Okebalama, a senior consultant at Henley & Partners, Nigeria. Irrespective of place of birth or current residence, HNWIs often pay focused attention to future proofing themselves, their families and their wealth.