Over 10 000 millionaires from the rest of Africa are expected to move to South Africa over the next decade, according to a report by New World Wealth, which provides information on the global wealth sector, especially high growth markets.
According to the report, these millionaires – having a net worth of about R14.5m or more – from the rest of Africa would then significantly boost millionaire numbers and luxury spending in SA.
By June last year, it was estimated that there were about 163 000 dollar millionaires living in Africa with a combined wealth of $670bn.
Research by New World Wealth found that over 1 500 millionaires from the rest of Africa have moved to SA since 2007. Most of them came from Nigeria, Angola and Ghana. Many millionaires from the rest of Africa have also bought second residences in SA, which they use for business and holiday purposes.
These millionaires are attracted to SA by good private schools for their children, luxury residential estates, good private healthcare, exclusive shopping centres and good transport infrastructure. They also like that SA is an English-speaking country and that there is very little religious violence.
At the same time, New World Wealth has found that 2015 was a particularly bad year for SA millionaires. The number of HNWIs in the country declined by 18% during 2015 – from 46 800 at the end of 2014 to 38 500 at the end of 2015. For the purposes of the report, local HNWIs included all individuals living or working in SA, including expats.
The decline in numbers was found mainly to be due to poor economic conditions in SA. A significant number of HNWIs also left the country in 2015. Based on its 2015 migration survey, New World Wealth estimates that SA lost just over 950 millionaires to emigration in 2015. Of the ones that left, 36% went to the UK, 15% to Australia, 11% to the US, 8% to Canada, 5% to Mauritius and 4% to Israel.
Previous research done by New World Wealth in 2015 found that nearly 42% of all dollar millionaires in Africa were living in South Africa’s top four cities. According to their latest research 44% of the so-called high net worth individuals (HNWIs) in SA – those worth about R14.5m or more) live in Johannesburg. About 18% (7 000) live in Cape Town, 7% (2 600) in Pretoria and 7% in Durban (including Umhlanga).
Paarl, Franschhoek and Stellenbosch in the Western Cape are, however, the areas with the fastest growing numbers of dollar millionaires in South Africa. The number of millionaires in these three towns and their surroundings has increased by 38% from 2007 to 2015.
Research showed that by June last year Cairo in Egypt had the second most millionaires in Africa, followed by Lagos in Nigeria.