Interesting statistics… below is excerpt from a recent Forbes’ article:
“Brazil has been adding 19 ‘millionaires’ per day since 2007. Note that these are millionaires in Brazilian currency terms. Brazil currently has 137,000 millionaires and some 30 billionaires, with 70% of the country’s wealth concentrated in Sao Paulo and Rio de Janerio.
Brazilian consumption continues to grow very strongly, boosting the fortunes of retailers, banks and a plethora of industries that are clamoring for size. As these businesses grow, so does their owners’ wealth.
“There are many emerging companies growing very fast, especially in retail, but also in healthcare, real-estate, construction and other basic industries,” Guillermo Morales pointed out. He said M&A; activity is also gaining traction as many industries look to consolidate or large players (both locally and abroad) snap up smaller ones. A case in point is Schneider Electric’s recent purchase of small Brazilian electrical supplier Steck Group for some $350 million.
Another factor accounting for the rising tide of millionaires are high executive and banker salaries, which Morales said often beat those paid in the US. He noted it’s common for Brazilian investment bankers to make a US$539,000 (BR$1m) annual bonus these days while CEOs can make an average of US$75,000 a year (our comment: it just shows the compensation and payment distortions in the country).
According to other bankers, Brazil’s booming real-estate industry has also generated huge wealth as property values have doubled in recent years and are poised to increase further, especially in Rio de Janerio, as the city girds up to host the 2014 World Cup and the 2016 Olympics. (our comment: these so-called “real estate millionaires” are only millionaires on paper, and that will only prove to be true if property owners sell at these high prices and pocket their gains… many Americans were also millionaires in 2005 and 2006 based on their property values, and everyone knows what happened…)
“I think that this trend will continue for the next three years but I don’t see it lasting forever. After all, there is a limit to everything,” Morales noted.