Coronavirus pandemic strips 154 Israelis of millionaire status

The coronavirus pandemic has ousted 154 people from the ranks of Israeli millionaires, the Credit Suisse Global Wealth Report 2020 shows, with the nation counting 157,286 such persons, as of June 2020, compared to 157,440 millionaires in Israel at the start of the year.

Israel is ranked 30th globally for its number of millionaires. It also has 10 billionaires, unchanged from 2019, compared to 358 in the US, 142 in China, and 66 in Germany, the three nations with the most billionaires.

The bank considers a millionaire anyone with $1 million in liquid assets — or some NIS 3.4 million. The Israeli millionaires’ average wealth was a net $3.33 million, deducting liabilities and loans, the data showed, similar to last year.

The average wealth of each adult Israeli was $220,996, as of end June 2020, compared to $222,513 at the start of the year, ranking the nation 20th for average adult wealth.

Wealth growth globally will be depressed for the next couple of years, and likely longer, as the coronavirus pandemic has cut economic growth and increased national debt, the report said.

The onset of the pandemic resulted in a $17.5 trillion drop, or 4.4%, in global household wealth between January to March, the report said. The pandemic has caused average wealth per adult to drop to $76,984, whereas without the pandemic, global wealth per adult would have been $78,376, the report said.

Last year, total global wealth rose by $36.3 trillion and wealth per adult reached $77,309, up 8.5% versus 2018. As a consequence, the world was better placed to absorb any losses from COVID-19 during 2020.

“The surge in equities was the main reason why many countries posted exceptional rises in household wealth during 2019. The United States not only continued its unbroken spell of increases in total wealth each year since 2008, but recorded a gain of $42,090 per adult, far above the rise in any previous year,” said Hila Goldenberg, the CEO of Credit Suisse Israel, in a statement released on Sunday.

The most adversely affected region by the pandemic in 2020 was Latin America, where currency devaluations led to the economies to contract, resulting in a 12.8% reduction in total wealth in US dollar terms. The pandemic eradicated the expected growth in North America and caused losses in every other region, except China and India.

Among the major global economies, the United Kingdom has seen the biggest relative erosion of wealth, the report said.

Due to lockdowns, and rent and mortgage deferrals, reflected in a fall in global consumption, the rate of savings has risen globally, but its overall impact on wealth is likely to be modest, the report said, since limitations on spending are not expected to persist in the long term.

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Written by Aakash Malu


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