Photo Credit:REUTERS/Thomas MukoyaLong seen as synonymous with poverty and droughts, Ethiopia has broken all stereotypes and seen the largest increase in number of dollar millionaires in Africa over the past six years as its economy soars.
The country, which has the second largest population in Africa at 85 million people, saw the number of millionaires grow from 1,300 to 2,700 in six years - a whopping 108% increase, according to the latest research from New World Wealth.
High economic growth in Africa has given rise to a wealthy segment of the population, as the authorities slowly make a dent on poverty levels and alleviate the lives of millions of Africans.
The new economic push has also given rise to entrepreneurial Africans who have benefited from the range of opportunities that are on offer - from telecoms, to healthcare, from development of mineral resources to agriculture - and everything in between.
The UK-based New World Wealth's list of ten fastest-growing African countries for millionaires, could also serve as the list of countries which have seen the greatest growth in economic terms.
"Ethiopia is one of the largest countries in Africa in terms of population with over 85 million inhabitants and we expect it to become one of the 10 largest African wealth markets by 2030," Andrew Amoils, senior analyst at New World Wealth, wrote in the report.
After Ethiopia, Angola is home to the second fastest growth in millionaires -- up 68% between 2007 and 2013.
Tanzania (up 51%), Zambia (up 50%) and Ghana (up 50%) make up the countries with the greatest percentage increases.
SOUTH AFRICA DOMINATES
After Ethiopia, Angola is home to the second fastest growth in millionaires -- up 68% between 2007 and 2013.
Tanzania (up 51%), Zambia (up 50%) and Ghana (up 50%) make up the countries with the greatest percentage increases.
SOUTH AFRICA DOMINATES
Despite the advances made by a number of African countries, South Africa remains home to the largest number of millionaires, with nearly 48,700 high-net-worth individuals calling it home - a growth of 14% over six years.
Egypt remains a distant second with 22,800 millionaires, although growth has crawled to 2% over six years, reflecting the political upheaval it has faced over the past few years.
Nigeria - the region's second largest economy -- has been growing at a much faster clip at 44% during the period, and is now home to 15,700 millionaires.
Kenya, Tunisia, Angola, Libya, Tanzania, Morocco and Algeria, round up the top ten countries with the highest concentration of millionaires.
2030 FORECAST
Egypt remains a distant second with 22,800 millionaires, although growth has crawled to 2% over six years, reflecting the political upheaval it has faced over the past few years.
Nigeria - the region's second largest economy -- has been growing at a much faster clip at 44% during the period, and is now home to 15,700 millionaires.
Kenya, Tunisia, Angola, Libya, Tanzania, Morocco and Algeria, round up the top ten countries with the highest concentration of millionaires.
2030 FORECAST
South Africa will retain its number one rank with 86,700 millionaires by 2030, a far cry from second-placed Nigeria with 43,000 millionaires. The NWW forecast expects Egypt to lose its second spot, and register the lowest growth among the top 10 countries.
"In terms of growth rate forecasts, Ivory Coast comes out on top with growth of 243% between 2013 and 2030," the report said. "Zambia ranks second with 200% growth followed by Ghana (196% growth) and then Ethiopia (193% growth)."
GLOBAL WEALTH MANAGERS COME TO TOWN
A recent CapGemini report estimated that there were 135,800 African millionaires in 2012 - a near-10% increase over the previous year, and the fastest growing region. In 2008, there were less than 94,600 millionaires in the continent.
"Africa outperformed the global growth rate for both HNWI [high-net-worth individual] population and wealth. HNWI population for Africa grew 9.9% compared to 9.2% globally while HNWI wealth in the region increased by 11.5% compared the global average of 10.0%," CapGemini noted.
Over the next five years, wealth in Africa is projected to rise by 90%. South Africa is a model for many other African markets, with an established stock market and sophisticated insurance and pension industries, said PriceWaterHouseCoopers in a report. "Wealth managers should leverage connections established with expanding corporations and businesses in order to reach HNWIs."
A number of international wealth managers including Switzerland-based UBS, US-based Citibank and emerging market bank Standard Chartered are increasingly focusing their efforts to cater to Africa's wealthiest.
While many well-heeled Africans are being serviced from London, New York, and Geneva, there is an increasing effort from regional banks to focus on this fast-growing market.
Barclays Africa Group Bank, for example, has expanded its presence in places like Kenya, Ghana and Mauritius.
"With global wealth shifting toward emerging markets, wealth managers are under increasing pressure to rethink their growth strategies and to capitalize on new market opportunities," said PWC. "While political and regulatory risks can be significant in these emerging markets, the decline of state-owned entities, abundant natural resources, and economic reform agendas will spur economic activity, establishing the conditions for wealth creation."
The international banks are competing with South African and Nigerian banks for the growing wealth banking market in the continent.
The rise of millionaires is a welcome development and mirrors the growth being experienced by many African countries. But despite the positive development, there is a sense that the wealth continues to be concentrated in the hands of few.
"The broad picture emerging from the data is that Africa's economies have been expanding robustly and that poverty is coming down," says Shanta Devarajan, the World Bank's chief economist for Africa.
"At the same time, the aggregate numbers hide a great deal of diversity in economic growth and performance, even among Africa's faster growers," Devarajan said in a World Bank report.
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