Asia shows rise in high net individuals, but fails to unlock its human capital potential

According to the report by Knight Frank LLP, it is estimated that Asia will be witnessing the rise of plenty of billionaires in future. “The number of Asian billionaires will rise by 27 percent to 1,003 between 2018 and 2023, making up more than a third of the world’s total billionaire population of 2,696,” according to the estimates.

However with the rise in the billionaires, the rich are becoming increasingly cautious in their investments. An increasing number of individuals in Asia keep their wealth in currency, and spend less in viable asset possessions such as gold or bonds

“We are seeing a re-balancing of portfolios away from equities toward more defensive asset classes,” said Nicholas Holt, Knight Frank Asia Pacific’s head of research. “While cash, gold and private equity are likely to be increasingly targeted, investment-grade property with strong tenant covenants will also see significant interest over the next 12 months, “he added.

But as we talk about hosting some of the major billionaires, Asian region will show you a major contrast in the bigger picture pertaining to its human resources. Capital is not only limited to the national capital but also human capital development, which is not its best light in the Asian region currently. 

Although Asia will also see the biggest increase in ultra-high net worth individuals (people with net assets of $30 million or more), where India leads the world with 39 per cent increase, the other side of it exposes India. One would estimate that high number of billionaires would plausibly mean better earning potential, of individuals.

But Asian countries have been ranked poorly on the global Human Capital Index, which measures countries on the parameters of development and distribution of human capital. Here’s a contrast:

Asia hosting world billionaires showcases the immense potential of the region, but lags in the areas of overall human development. The countries in the region have shown equalizing growth in resource distribution and education, and seems to have long quest ahead in terms of inclusivity of growth.

With countries such a Singapore realizing human capital to its full potential, some nations in the region need to work on reaching even the bare minimum when it comes to optimizing its human capital.

However, Asian governments plan to use both manual and natural resources to upgrade their value chain, which will prove to be a real soar in the country’s wealth worked upon judiciously.