Where do Africa's richest live? In Joburg, while Cape Town also among the elite
A New World Wealth report has identified the two SA cities as among the wealthiest in the Africa and Middle East region
Johannesburg and Cape Town are among the richest cities in Africa and the Middle East.
This is according to a New World Wealth report which reviewed the wealthiest cities in the world in 2021, with a special focus on the Africa and Middle East region.
The report, which contains figures as of June 2021, took into account private wealth rather than GDP.
Wealth - in the report - refers to the net assets of a person and includes property, cash, equities and business interests, less any liabilities.
Johannesburg has been identified as the wealthiest city in Africa, with total wealth amounting to $235bn (R3.41-trillion).
“Most of Johannesburg’s high net worth individual wealth – those with $1m (R14.5m) or more – is concentrated in the suburbs of Sandhurst, Hyde Park, Houghton and Westcliff.
“Major sectors in the city include financial services and professional services like law firms, consultancies,” the report states.
When it comes to Cape Town, real estate and fund management are fuelling wealth there.
“Total wealth held in the city amounts to $130bn [R1.89-trillion). It's home to Africa’s most exclusive suburbs including Clifton, Bantry Bay, Fresnaye, Llandudno, Camps Bay, Bishopscourt and Constantia.”
The report noted it is also home to a number of top-end lifestyle estates like Steenberg, Atlantic Beach and Silverhurst Estate.
Dubai, Tel Aviv and Istanbul - a gateway city between the Middle East and Europe - have also been listed among the richest cities in Africa and the Middle East.
Dubai, with its of $530bn (R7.69-trillion) “is the wealthiest city in the Middle East and Africa region and the 29th wealthiest city in the world”.
The report said the city was home to just more than 54,000 high net worth individuals, as well as 165 centimillionaires and 12 billionaires.
“Major industries there include financial services, basic materials, oil and gas, transport, hotels, retail and real estate.
“We consider wealth to be a far better measure of the financial health of an economy than GDP,” said New World Wealth's Andrew Amoils.
Reasons for this include:
- In many developing countries, a large portion of GDP flows to the government and therefore has little impact on private wealth creation.
- GDP disregards income levels in a country.
- GDP ignores the efficiency of the local banking sector and the local stock market at retaining wealth in a country.
- GDP largely ignores the impact of property and stock market moves. These two factors have a huge impact on wealth.
- GDP is generally quite a static measure – it tends to only move slightly year-on-year. As a result, it is not a great gauge of the performance of an economy.
“Wealth figures, on the other hand, do not have any of these limitations, making them a far better gauge of the financial health of an economy than GDP figures.”