Milionaire comparision - Essay Example

China’s number of millionaires is currently at 1.12 million in 2013 and is expected to rise to 2.1 million in 2018 thus representing an 88% increase. In the last one year, China experienced 90, 000 rising millionaires making her projections for 2018 to be doubled. This essay compares and analyses factors catapulting China and India’s rapid growth in the number of millionaires. China, India and Singapore recorded the highest increase in millionaires in 2011 and the Asia-Pacific experienced a rise in wealth while Western Europe and America encountered a decline in wealth.

The millionaire households in China rose by16 percentage and India saw a 21% increase, which represented 1.43 million and 162, 000 respectively. Nevertheless, the millionaires households in America decreased by 129, 000. US seems to lose the number of millionaires to China and India where the percentage increase in overall private wealth in both China and India’s overall private wealth has been attributed to their strong GDP (Datamonitor Financial, 2012). The two emerging markets tend to drive the future growth of wealth as the US, Western Europe and Japan loses wealth prompting the financial services and conventional wealth managers to look to the new markets for profit maximization.

Banks in India and China are preparing themselves to capture their new millionaire clients. Although the United States and Japan rank first and second as the countries with a huge number of millionaires, the rapid growth in millionaires is only evident in India and China (New, 2012). According to Hess (2013), mature markets such as US, Japan and Western Europe experience either slow or negative growth while emerging markets such as China and India ride a wave of very strong momentum steering their people to greater heights.

The china’s wealthy people rise at a higher rate compared to other countries experiencing financial crisis recovery. Rapid economic growth experienced in China, India and other emerging markets has largely contributed to the number of millionaires globally. The millionaires in these countries boast cash, stock and cash assets of more than $1 million and the two countries are likely to experience the rapid growth because of their many listed companies. The robust exports linked with both China and India enhanced their GDP growth making the rate triple the once for developed countries.

Recent economic growth in both China and India that has resulted to a huge number of millionaires is based on exports mostly to Europe and North America. Upon joining World Trade Organization, China’s export has largely increased making her value of exports between 2006 and 2013 to double from $1.1 trillion to $2.3 trillion. Similarly, India is further expected to experience a growth in exports from $191 billion to $350 billion within the same period (Hess, 2013). The high rate of domestic demand in both countries due to their high population is likely to enhance their respective economic expansion thus leading to emergence of more millionaires.

The decrease in demand from Western Europe and the US because of the financial crisis and the Eurozone’s debt challenges can therefore stall the growth of China’s economy. Interestingly, the impressive economic growth in India and China is unequal making their millionaires to represent 3.0% of the larger population. Rate of unequal