Commodities multiply the world's wealthy

Latin America, the Middle East and Africa saw the greatest growth in the number of rich people last year as surging commodities prices and booming local stock exchanges increased the wealth of entrepreneurs and investors in emerging markets.

The number of people with liquid assets of at least $1m grew by 10 per cent or more in those three regions, according to a report by Merrill Lynch, the investment bank, and Cap Gemini, the consultancy.

The report estimates last year there were 8.7m millionaires on the planet, an increase of 6.5 per cent upon 2004. What's more, these people are becoming richer, with their total assets rising 8.5 per cent last year to an estimated $33,300bn.

Wealthy people in North America, Europe and Asia continue to account for the vast majority of the world''s millionaires. These three regions account for 8m of the global total, and 82 per cent of total wealth.

The figures reflect the effects of economic growth and rising stock markets worldwide last year, particularly growing demand for commodities. Some of these gains are likely to have been reversed in recent months after a sharp sell-off in some emerging markets as some investors switched back to less risky asset classes.

Swelling ranks of the rich have led to a scramble among the world's largest banks to capture them as clients. Growing complexity of wealth management has encouraged rich people to shift assets to large financial institutions in recent years, though even the largest players still have only a very small share of the market.

The world's rich continue to shift their money into alternative asset classes, with the proportion of wealth allocated to private equity and hedge funds rising to 20 per cent on average last year. That reflects a strong inflow into private equity, Merrill Lynch found. Lacklustre returns meant investors were less enthusiastic about hedge funds than in previous years.