Over the past 5 years, Africa has seen an increase in the number of high net worth individuals (HNWI), largely correlated with the continent's economic growth of nearly 4% per year. In 2021, it returned to its 2015 level and its millionaire population is expected to increase by 42% in the next 10 years.
Over the past 5 years, Africa has seen an increase in the number of high net worth individuals (HNWI), largely correlated with the continent's economic growth of nearly 4% per year. In 2021, it returned to its 2015 level and its millionaire population is expected to increase by 42% in the next 10 years.
Historically, Westerners have been more interested in the five largest economies on the continent, in particular South Africa, Nigeria, Kenya, Egypt and Morocco. However, these savings only represent just over 56% of HNWIs (High Net Worth Individuals) whose assets under management exceed $1 million.
What about other countries? Why not take an interest in it? Why not also focus on individuals whose assets exceed 1800 times the average monthly salary? If we apply this ratio to France, we should only be interested in individuals with more than 4,6 million euros in managed assets. In this context, should we not review the value and scoring scales of what an HNWI represents at the local level, with regard to its real purchasing power? Private wealth is growing across the continent, providing promising markets for wealth management and investment advisory firms, even as major French banks continue to divest from the continent.
Certainly, Africa is a continent of 54 countries with cultures and relationships to heritage and money that differ from one country to another. African HNWIs face many unique challenges. Political instability, endemic corruption, cumbersome and manual bureaucracy, brain drain, power outages and capital flight are just some of the common challenges. But Botswana ranks just behind Portugal in 2022 and 3 places ahead of Spain in terms of corruption (8 places ahead of Italy). Rwanda is positioned behind Greece and ahead of Croatia, far ahead of China. Benin, Ghana, Senegal, South Africa and Burkina Faso out of 180 countries rank in the 66 countries least affected by corruption. As for bureaucracy, what can we say in the face of 500 standards and 000 laws and 17 codes existing in France or 000 pages of regulations What do our prefects receive per year?
The subject of addressing African Heritage is more cultural than real. Many banks or European Heritage managers project their framework onto countries which have nothing to do with what they know. This is why high net worth people in Africa are faced with the double problem of having unique local constraints requiring adapted financial and wealth management advice and contacts present and available nearby or reachable.
It is normal that large European or international financial institutions may have difficulty maintaining a physical presence in all countries on the continent, or even beyond the five largest countries. Even using Fintechs or local partnerships with local banks or other financial services, the level of profitability required, with regard to the information systems to be implemented and the local operating costs to which are added those of the standards European and international regulatory requirements are extremely weak.
Beyond the large, increasingly mature African countries, great growth opportunities exist in underserved countries with rapidly growing economies. Currently, the fastest growing economies in Africa are Rwanda (+75% growth in private wealth until 2032), Ivory Coast, Benin, Ethiopia and Tanzania. It is in this area that Kouamou Capital, like other players in independent private management, is positioning itself... without real competition. It is up to Africa to create its own standards.
More agile, more expert, closer to local markets, Kouamou Capital is better positioned than anyone to respond to the challenges of Africa's high earners, with the ability to adapt to available financial resources and help them navigate international investments and wealth management.
ARTICLES AND ANALYZES
This website uses cookies. By continuing to use this site, you accept our use of cookies. learn more
