Asia is home to some of the world’s richest families that have accumulated wealth across different generations. As families accumulate more wealth, they continue to dwarf poor countries with struggling economies.
Data presented by Buy Shares indicates that the top ten wealthiest families in Asia control a cumulative fortune of $307.31 billion as of November 2020. India’s Ambani family, known for Reliance Industries, is the wealthiest family, with the wealth amounting to $76 billion. Chinese Sy family ranks as the tenth richest family in Asia with a fortune of $19.70 billion.
The research compared the wealth to the cumulative GDP of 61 most impoverished countries. As of December 2019, the countries had a GDP of $304.65 billion in total. The ten poorest countries trail the wealthy Asian families by about $2.66 billion. Kiribati is the world’s poorest country, with a GDP of $0.19 billion.
How the richest families continue growing their fortune
The highlighted wealthy families and the poor countries operate under different economic conditions. Specifically, the families are located in a region that is enjoying rapid economic growth with countless opportunities. The developing countries are still struggling to find productive economic policies.
The families have remained resilient in preserving wealth through generations. The ability to maintain and grow wealth is due to diversifying investment portfolios to match current market conditions. On the other hand, the poor countries are still grappling with ineffective leadership and runaway corruption that has hampered economic growth. The countries continue to remain dependent on investments from such families.
By the end of the year, the gap between the families and the highlighted countries might be greater. The data on GDP is based on 2019 findings. However, this year’s figures might be lower due to the economic impact of the coronavirus pandemic. Most countries globally witnessed the crippling of their economies. Some of the countries like Seychelles heavily rely on tourism but the sector was among the most impacted by the pandemic. In such cases, GDP for 2020 might witness massive corrections.
As the countries seek recovery away from the pandemic, a section of the wealthiest families saw their fortune increase during the health crisis. Families that have a stake in the technology sectors are among the primary beneficiaries of the pandemic. For example, amid the health crisis, the Ambani family struck deals with some of the world’s leading tech companies to sell stakes in Reliance’s digital unit. Ambani’s wealth has been growing recently to double the fortune of Asia’s second most affluent family.
It is worth mentioning that wealthy families have been amassing there’s fortune over the years. The growth has been aided by robust GDP and equity market growth, especially in the emerging markets of India. Elsewhere, families in mature economies like Japan and South Korea have witnessed consistent growth in wealth.
Widening global inequalities
From the data, there is greater inequality between the wealthiest families and the poor countries. Notably, economic growth appears to benefit a small fraction of the world. This inequality has sparked increasing discussion of the need for inclusive growth with the potential to ensure as many people as possible enjoy greater prosperity.
Global inequalities have been on the rise leading to societal divisions widening. Citizens in poor countries continue to search for opportunities, something that can lead to unrest. As a result, there have been calls to reduce inequality to improve livelihood as most people recover from the pandemic.