By Lise Alves, Senior Contributing Reporter
SÃO PAULO, BRAZIL – Facing one of the worst economic crisis in decades and a series of political scandals, Brazil lost approximately twelve thousand HNWI (high net worth individuals), or super-rich, in 2015, according to a study conducted by Capgemini. The study shows that the number of Brazilian HNWI fell from 161,200 in 2014 to 148,500 last year.
“A fall in commodity prices, the slow pace of reforms by the re-elected government, and a corruption scandal at the country’s state-owned energy firm brought equity markets down by 17.4 percent, contributing to declines of 6.4 percent in HNWI population and 1.4 percent in HNWI wealth,” stated Capgemini’s ‘World Wealth Report 2016’.
According to the consultancy the country, which accounts for more than fifty percent of Latin America’s HNWI wealth, limited Latin America’s growth and influenced global expansion of HNWI.
“Latin America experienced declines in HNWI population (-2.2 percent) and wealth (-3.7 percent), largely due to a crash in commodity prices and economic and political turmoil in Brazil,” concluded the report.
Last year allegations of mismanagement of public funds and irregular loans led the country into political chaos, culminating in the suspension of Brazil’s president, Dilma Rousseff, at the beginning of 2016. Added to this, a mega-corruption scandal involving one of the country’s largest state-owned companies, oil and gas giant Petrobras, severely compromised some of Brazil’s largest construction and logistics companies, hurting infrastructure and long-term investments.
The weakening economy, in addition to the steep decline in commodities prices in the international market and the sharp depreciation of the Brazilian currency in relation to the U.S. dollar all led to a reduction of the number of Brazilians millionaires last year.
The report considers the ‘super-rich’, those people who have liquid assets of more than US$1 million, excluding the real estate in which they reside, collectibles and consumer durables.