Amidst its immense diversity and complex socio-economic fabric, the African continent is carving out a formidable presence in the global wealth arena with the number of millionaires and billionaires in the continent rising significantly.

The latest edition of the Africa Wealth Report for 2024, a collaborative effort between Henley & Partners and New World Wealth, unveils a compelling narrative of Africa’s burgeoning wealth landscape.

With a staggering investable wealth tallying at USD 2.5 trillion, coupled with a projected surge of 65% in its millionaire populace over the forthcoming decade, Africa emerges as a pivotal player in the global economic narrative.

In its ninth iteration, the annual report meticulously dissects Africa’s high-net-worth individuals (HNWIs), revealing a current count of 135,200 individuals boasting liquid investable assets exceeding the USD 1 million mark. Furthermore, the continent boasts 342 centi-millionaires and an impressive cohort of 21 billionaires. Although compared to other continents, Africa still lags, mainly due to its multifaceted challenges obstructing economic growth.

Among the challenges are currency depreciation and underperforming stock markets.

“Currency depreciation and underperforming stock markets have chipped away at Africa’s wealth compared to global benchmarks,” notes Dominic Volek, Group Head of Private Clients at Henley & Partners. “The South African rand fell 43% against the US dollar from 2013–2023, and currencies in most other African countries also performed poorly compared to the dollar over the past decade.”

Volek added that currencies in most other African countries also performed poorly compared to the dollar over the past 10 years, with dramatic depreciations of over 75% recorded in Nigeria, Egypt, Angola, and Zambia.

Echoing Volek’s sentiment, Andrew Amoils, Head of Research at New World Wealth, noted the impact of migration on Africa’s wealth trajectory.

“Approximately 18,700 high-net-worth individuals have left Africa over the past decade,” Amoils reveals. “Most of these individuals have relocated to countries such as the UK, the USA, Australia, and the UAE.”

Nevertheless, Africa remains a crucible of opportunity, boasting some of the world’s fastest-growing markets. The ‘Big 5′ wealth markets – South Africa, Egypt, Nigeria, Kenya, and Morocco – stand as a testament to Africa’s economic vibrancy, commanding over 56% of the continent’s millionaires and over 90% of its billionaires, according to the report.

Despite facing challenges over the past decade, including a 20% decline in its millionaire population, South Africa still boasts the largest population of HNWIs in Africa. With 37,400 millionaires, 102 centi-millionaires, and 5 billionaires, South Africa leads the continent in terms of wealth concentration. Egypt follows closely behind with 15,600 millionaires, 52 centi-millionaires, and 7 billionaires.

Nigeria ranks third with 8,200 HNWIs, followed by Kenya with 7,200 millionaires, Morocco with 6,800, and Mauritius with 5,100. Algeria, Ethiopia, Ghana, and Namibia are the top 10 wealthiest countries in Africa, with varying numbers of HNWIs ranging from 2,300 to 2,800. Despite economic challenges, these countries continue to attract and sustain affluent populations, contributing to their positions as key players in Africa’s wealth growth.

Moreover, burgeoning economies such as Mauritius, Namibia, and Zambia are poised to witness exponential growth in their millionaire populations over the next decade.

Renowned South African political commentator Justice Malala noted Africa’s economic prowess, projecting Sub-Saharan Africa as the second-fastest-growing region globally in 2024, trailing only behind Asia.

The growth prospect has opened room for Africa to expand its leadership role globally. With Africa expected to claim 11 out of the 20 fastest-growing economies globally, African leaders are clamoring for greater representation in international decision-making forums.

“With Russia, China, the USA, and the EU all jostling for favor on the continent, African leaders have become more emboldened and are demanding a seat at the top tables. These will come with closer relationships between continental leaders and other “middle powers” such as India, Turkey, Argentina, and Saudi Arabia. Already, Ethiopia and Egypt have joined the BRICS grouping and the African Union has become a permanent member of the G20. Previously, only South Africa was in these exclusive clubs,” said Malala.

He added that with growth projected at 4% by the IMF, Sub-Saharan Africa will be the second-fastest–growing region in the world in 2024, after Asia.

Though the wealth comes from many sectors of the continent’s economy, real estate stands out – with some cities claiming the lion’s share of the growth.

In real estate, Johannesburg and Cape Town emerged as veritable bastions of wealth, with promising growth trajectories witnessed in cities such as Kigali, Windhoek, and Marrakech.

Louisa Mojela and Nontobeko Ndhlazi of WIPHOLD extol Africa’s allure for investment, attributing its appeal to a youthful demographic dividend and rapid urbanization.

In luxury real estate, Cape Town reigns supreme, closely followed by Grand Baie in Mauritius and select cities in South Africa and Morocco. Berry Everitt, CEO of the Chas Everitt International property group, notes Africa’s allure in the global luxury real estate arena, propelled by a burgeoning demand fueled by demographic and urbanization trends.

However, Africa’s economic mobility is stifled by passport limitations, constraining citizens’ ability to traverse international boundaries for business and investment endeavors.

According to the report, only two African passports, those of Mauritius and Seychelles, grant their holders access to more than 50% of global GDP without requiring a visa in advance. This is despite Africa being home to some of the most open nations in the world based on the Henley Openness Index, which measures visa-free access to other countries. While many African countries are open in terms of visa-free access, the economic power and influence associated with global GDP access remain limited for most African passport holders.

“Africa tops the list of rejections with 30% or one in three of all processed applications being turned down, even though it had the lowest number of visa applications per capita. This was 12.5% higher than the global average,” said Mehari Taddele Maru, part-time professor at the School of Transnational Governance and Migration Policy Centre.

“The rejection rates for African applicants for Schengen visas are generally 10% higher than the global average, three times higher than the highest rejection rate, and ten times higher than for US-Americans. Despite justifications based on security or economic concerns, the European visa system clearly demonstrates apparent bias against African applicants.”

However, the report noted that Africa is ascending in the global wealth echelons – underpinning a continent on the precipice of transformation, brimming with opportunities for discerning investors. It however emphasized the need for friendly immigration policies as investment migration is emerging as a potential further mechanism to accelerate Africa’s economic growth.

“By offering residence and citizenship by investment opportunities, African countries can attract vital foreign capital, stimulate job creation, and foster knowledge transfer,” said Volek.

The International Monetary Fund (IMF) has projected a decline in Nigeria’s inflation rate to 26.3% in 2024, alongside an anticipated economic growth of 3.3% for the same year.

Released as part of its revised Global Economic Outlook for 2024, the IMF’s report highlighted Nigeria’s improving growth prospects while leaving Sub-Sahara Africa’s growth outlook unchanged, balancing a downward forecast in Angola with an upgrade in Nigeria’s projections.

The IMF’s report indicates that Nigeria’s economy is expected to grow by 3.0% in 2025, a slight decrease from the Fund’s previous projection in January 2024. Despite this, the Sub-Saharan Africa region is forecasted to experience growth, rising from an estimated 3.4% in 2023 to 3.8% in 2024 and further to 4.0% in 2025, attributed to the gradual subsiding of earlier weather shocks and improving supply issues.

“In sub-Saharan Africa, growth is projected to rise from an estimated 3.4 percent in 2023 to 3.8 percent in 2024 and 4.0 percent in 2025, as the negative effects of earlier weather shocks subside, and supply issues gradually improve,” the report stated.

Globally, the IMF predicts stable growth at 3.2% for both 2024 and 2025, maintaining the same rate as seen in 2023. The report indicates a slight increase in growth for advanced economies, projected to rise from 1.6% in 2023 to 1.7% in 2024 and 1.8% in 2025. Emerging markets and developing economies are expected to experience a slight deceleration in growth, decreasing from 4.3% in 2023 to 4.2% in both 2024 and 2025.

The IMF’s projection aligns with analysts’ expectations of a downward trend in Nigeria’s inflation, despite the consistent increase witnessed since the beginning of the year. Starting at 29.90% in January and reaching 33.2% by March, inflation has been a significant concern.

The World Bank’s Africa Pulse publication also forecasts Nigeria’s inflation to be lower, projecting it at 24.8% in 2024 and settling at 15.1% in 2026, in line with the IMF’s growth rate projection of 3.3%.

The report attributes the improved economic prospects for Nigeria to several factors, including a slight uptick in global economic growth, stable growth projections for advanced economies, and a relatively favorable outlook for emerging markets and developing economies.

Keeping hope of economic recovery alive

One of the most notable implications of a decline in inflation is the potential boost to the spending power of Nigerians. With prices rising at a slower rate, consumers are expected to experience an increase in their purchasing power. This, in turn, is also expected to stimulate consumer spending, a critical driver of economic activity, and contribute to overall economic growth.

Furthermore, a decrease in inflation is likely to provide relief to households and individuals grappling with the high cost of living. As the erosion of the value of money slows down, Nigerians are expected to find it easier to afford essential goods and services, thereby alleviating financial strain and improving their quality of life.

Moreover, lower inflation rates often lead to a reduction in interest rates by central banks. This policy intervention aims to encourage borrowing and investment, further stimulating economic activity. Businesses may also benefit from increased confidence and stability, potentially leading to higher levels of investment, job creation, and overall economic expansion.

While the IMF’s forecast bodes well for Nigeria’s economic prospects, it is important to note that challenges persist. Experts have warned that the government will need to continue implementing sound economic policies and reforms to sustain the momentum of recovery and address underlying structural issues.

However, economists agree that the IMF’s projection of a decline in Nigeria’s inflation rate offers a glimmer of hope amidst economic uncertainty. They said if realized, this forecast could contribute to a more favorable economic environment, characterized by increased purchasing power, reduced cost of living, and enhanced economic stability.