Wealthy Africans See Political Climate as Key Risk to asset preservation

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Wealthy individuals in five African nations including South Africa, Nigeria and Kenya see political instability as a significant threat to the preservation of their assets, according to a report commissioned by Standard Bank Group Ltd.

Researchers from Johannesburg-based Intellidex surveyed 265 individuals in various industries across these countries to compile the report. It found that Africans were most concerned about political risk, with 82% of South African respondents citing it as significant. That compares with 67% in Ghana, 64% in Nigeria and 55% in Kenya. Only 31% of Mauritian respondents saw the political environment as a threat.

The role political stability plays in deepening economic and social progress is beyond debate, Standard Bank economist Simon Freemantle said in the report.

“The absence of political calm –- a reality which still besets many African economies — has the ability to fundamentally constrain economic growth and institutional reform, deter investment, and compound already pressing welfare and humanitarian challenges,” he said.

About 67% of respondents had an estimated net worth of $1 million to $5 million, with the rest estimated to have wealth exceeding $5 million.

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Other findings from the report:

Personal safety and security was another common concern for wealthy Africans; most respondents placed it at first or second on their list of concerns. South Africans placed it only fourth and are more concerned about stock market volatility and taxes.The main vehicle for consolidating and preserving wealth is property, with the exception of South Africa where investments in equities took the lead.

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