An estimated 499 Kenyans dropped from the rank of dollar millionaires last year, highlighting how the impact of Kenya’s soft economy has hurt persons who each had a net worth of more than Sh100...
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IN SUMMARY
The Knight Frank report shows that Tanzania is ranked fifth ahead of Kenya despite the latter having a bigger economy.
South Africa led the pack with 1,033 ultra-rich persons followed by Egypt (764) Nigeria (724) Morocco (215) and Tanzania (114)
An estimated 499 Kenyans dropped from the rank of dollar millionaires last year, highlighting how the impact of Kenya’s soft economy has hurt persons who each had a net worth of more than Sh100 million.
The 2020 Knight Frank’s Wealth Report classified 2,900 Kenyans among the world’s High Net-Worth Individuals (HNWIs) last year, representing a 14.6 percent drop compared to the 2017 count.
Six Kenyans also dropped from an elite group of super-wealthy persons known as Ultra High Net-Worth Individuals (UHNWI) with a net worth of more than Sh3 billion, cutting their number to 42.
The shifts emerged in a year of relatively hard economic times in the country, which has resulted in a drop in corporate profits that has seen thousands of people lose their jobs and cut dividends from firms owned by the wealthy.
Over the three years, Kenya has elevated political uncertainties following a bruising presidential election in 2017 that put on hold many investment decisions. This was compounded by poor weather that held back farming — which accounts for a third of the country’s gross domestic product (GDP)—last year.
“The drop in number of dollar millionaires was a reaction to the slowdown of the Kenyan economy,” said Andrew Shirley, one of the researchers behind the Wealth Report.
The manufacturing, real estate and technology sectors have the biggest contributors to the number of new dollar millionaires in recent years.
The sectors bore the brunt of Kenya’s reduced economic activity with real estate, which has over the past decade been a favourite investment home for the wealthy, being hit hardest.
Business people and workers who took mortgages on the strength of their pay slips and expected earnings defaulted on their loans with the slowdown in real estate hurting property developers who are finding it difficult to sell units that were also built on debt.
But Kenya had the sixth highest concentration of wealthy persons with a net worth in excess of Sh3 billion or UHNWI in Africa among the countries captured by the Wealth Report.
