Oct. 10 (Bloomberg) -- China may become the world’s wealthiest country by household assets after the U.S. in five years as the nation’s middle-class consumers grow richer, Credit Suisse Group AG forecast.
The nation will add $18 trillion in household wealth by 2017, taking its total to $38 trillion, according to the bank’s global wealth report today. That would surpass Japan’s $35 trillion, and be less than half of the U.S.’s $89 trillion.
China, which is embroiled in a territorial dispute with Japan over islands in the East China Sea, surpassed its Asian rival to become the world’s second-largest economy in the second quarter of 2010. It had annual gross domestic product of $7.3 trillion at the end of last year, compared with Japan’s $5.9 trillion.
“If we look at the very top end of the wealth pyramid, in terms of billionaires and ultra-high net worth individuals, China is expected to have a higher number of these high wealth holders than Japan,” said Fan Cheuk Wan, head of Asia-Pacific research for Credit Suisse’s private bank. “This is mainly related to continual capital-market reforms and privatization of the economy.”
Japan and China are each claiming the islands, called Senkaku in Japanese and Diaoyu in Chinese, since Japan moved to buy the islands from their private owner last month. The territorial dispute has clouded a trade relationship between Asia’s two largest economies that has tripled in the past decade to more than $340 billion.
Household wealth in the Asia-Pacific region will rise 55 percent to $115 trillion by 2017, Credit Suisse forecast, accounting for 35 percent of global wealth.
From mid-2011 to mid-2012, global wealth declined 5.2 percent to $223 trillion, mainly due to the euro-area’s debt crisis, said Fan. That’s the fastest decline since 2008, when it shrank 14.6 percent, she said.
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