Private investable financial assets reach $22t at end-2018
The growth rate of investable financial assets held by Chinese individuals slowed to 8 percent in 2018 due to a challenging economic background, a report revealed on Monday. However, analysts forecast that it would soon rebound once the government stimulus efforts kick in.
As of the end of 2018, China's private investable financial assets reached 147 trillion yuan ($21.89 trillion) with 1.67 million high net worth individuals (HNIs) having investable financial assets of more than 6 million yuan, according to a report on China's private banking market released jointly by China Construction Bank and Boston Consulting Group (BCG).
"The 8 percent growth was in line with last year's challenging economic background of external trading conflicts and internal industrial upgrading pressure," Tian Yun, director of the China Society of Macroeconomics Research Center, told the Global Times on Tuesday.
Beijing topped the list with an HNI rate of 78 per 10,000 people, and a total of 10 provinces and cities surpassed the threshold of 50,000 HNIs, BCG calculated. Private entrepreneurs are still the backbone of this group after 40 years of high-speed economic development amid the implementation of reform and opening-up, according to the report.
China has reduced the current value-added tax (VAT) rate of 16 percent for manufacturing and other industries to 13 percent and plans to reduce the tax burdens and social insurance contributions of enterprises by nearly 2 trillion yuan this year.
"Optimistically, the growth rate of private investable assets might rebound in the following years as China government has strengthened its efforts to stabilize economic growth with greater tax and fee reductions. More profit will remain in the private sector and create more HNIs," Tian said.