Israel makes impressive headway with wealth growth in 2021 - Credit Suisse

While it’s expected that the growth will be counteracted this year, a five-year forecast puts global wealth at over $100,000 per adult.

Illustrative photo of the 200 New Israeli Shekel bill. (photo credit: NATI SHOHAT/FLASH90)
Illustrative photo of the 200 New Israeli Shekel bill.
(photo credit: NATI SHOHAT/FLASH90)

Residents of Israel, do you feel any richer in 2021 than you did in 2020? According to the Credit Suisse Research Institute’s 13th Global Wealth Report, you ought to.

“Israel’s growth of wealth per adult showed strong resilience in 2021,” said Joseph Wolf, Credit Suisse’s general manager for Israel. “According to the report, Israel was among the six largest gainers globally, with a mean wealth per adult of $273,420. This number represents an increase of $41,010 in 2021 compared to 2020.”

The surge in wealth per adult in Israel is in line with a global surge in wealth from 2020/2021, when global wealth increased by 9.8%, an increase of about $463.6 trillion. Not accounting for exchange-rate movements, aggregate global wealth grew 12.7% in 2021, which Credit Suisse said was “the fastest annual rate ever recorded.”

The average global individual did well that year, the report said, with a rise of 8.4% in wealth per adult, or a boost of $87,489.

There is a high likelihood that 2021-2022 may not fare as well. According to the report, some of those gains could recede due to factors such as inflation, rising interest rates and declining asset prices.

 Amiram Fleisher (credit: Suisse Israel PR) Amiram Fleisher (credit: Suisse Israel PR)

“While some reversal of the exceptional wealth gains of 2021 is likely in 2022/2023 as several countries face slower growth or even recession, our five-year outlook is for wealth to continue growing,” said Nannette Hechler-Fayd’herbe, Credit Suisse’s chief investment officer for the EMEA region and global head of economics & research.

“Our forecast is that by 2024, global wealth per adult should pass the $100,000 threshold, and that the number of millionaires will exceed 87 million individuals over the next five years,” she said.

WEALTH AROUND THE WORLD

While all regions contributed to the rise in global wealth, North America and China led the pack, with North America accounting for a little over half of the global total and China adding another quarter, the report said.

These are massive contributions when compared with Africa, Europe, India and Latin America, which together made up 11.1% of global wealth growth. Credit Suisse attributed those regions’ lackluster performance to widespread depreciation against the US dollar.

Regarding women’s wealth, 15 out of the 26 countries that make up 59% of the global adult population, including Germany, India and China, had a decline in the wealth of women over 2020 and 2021, the report said. The other countries, including the US and the UK, had a rise in the average ratio of women’s wealth to men’s wealth.