“At the other end of the wealth pyramid, the bottom 52.5% of the world’ population (2.8bn) had net wealth of just 1.2%”
By Michael Roberts
My last post was on the Global Wealth report produced every year by Credit Suisse and associated economists. It showed that in 2021, 1.2% of adults had 47.8% of the world’s wealth while 53.2% had just 1.1%.
However, as I published that post, the 2023 global wealth report was released, now under the name of UBS which has taken over Credit Suisse (that’s another story). Now the data show that in 2022, global wealth inequality dropped back to 1% of adults (59m) owning 44.5% of all personal wealth, still slightly higher than before the pandemic in 2019. At the other end of the wealth pyramid, the bottom 52.5% of the world’ population (2.8bn) had net wealth of just 1.2%, slightly better than in 2021.
2022 recorded the first fall in net global household wealth since the global financial crisis of 2008. One reason was an appreciation of the US dollar against other currencies, reducing the dollar wealth of non-dollar countries. Indeed, if exchange rates are held constant at 2021 rates, then total wealth increased by 3.4% and wealth per adult by 2.2% during 2022.
The other reason was the relative decline in financial wealth during 2022 as stock and bond markets prices fell. So the number of US dollar millionaires worldwide fell by 3.5 million during 2022 to total 59.4 million at year-end. The ultra-high net-worth (UHNW) group with wealth above USD 50 million had 22,490 fewer members than in 2021, with North America accounting for 81% of this decline.
But the long-term trends outlined in the post on the 2022 report remain. The vast majority of rich and very rich people still live in the so-called ‘Global North’. This century, the rise of household wealth in emerging markets, most notably in the large populations of China and India, has narrowed wealth differences between countries. And this has been the dominant factor governing the overall slightly downward global inequality trend.
China’s median wealth per person in 2000 was about twice the world average; now it is more than three times. Moreover, it is now higher than the average for the whole of Europe (that’s Western and Eastern Europe)!
And this point remains: If you own a property to live in and, after taking out any mortgage debt, you still have over $100,000 in equity and any savings, you are among the wealthiest 10% of all adults in the world. You may find that difficult to believe, but it’s true because most adults in the world have no wealth to speak of at all.
And apart from phenomenal rise of China, personal wealth and power remains in the imperialist bloc of North America, Europe and Japan with add-ons from Australia. Just as the imperialist bloc rules over trade, GDP, finance and technology, it has nearly all the personal wealth.
- Michael Roberts is an economist and author, this article was originally published by Michael Roberts’ blog on August 24th, 2023.
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