Turkey has emerged as a leader in an annual global wealth ranking, surpassing other nations by a significant margin, despite facing high levels of inflation. According to the Global Wealth Report 2024 by Swiss bank UBS, Turkey experienced a remarkable growth of over 157% in wealth per adult between 2022 and 2023, outpacing all other countries. The report highlighted that Russia and Qatar followed with nearly 20% growth, while South Africa saw just over 16% growth. In comparison, the United States recorded a growth of nearly 2.5% in average wealth per adult.
Despite Turkey’s inflation rate reaching nearly 72%, causing financial challenges for its 85 million citizens, individuals who own assets like homes have seen their wealth increase due to the rising costs of these holdings. The UBS report defines wealth as the value of financial assets and real assets owned by households minus their debts. The relationship between inflation and wealth growth in Turkey was discussed by the report’s authors, emphasizing that high inflation rates can lead to faster wealth accumulation, particularly for those who own real assets like housing or equities.
The report also highlighted the impact of currency fluctuations on wealth growth, noting that local currency growth figures can differ significantly from those in dollar terms. For instance, Turkey’s wealth growth of over 63% in USD more than doubled to nearly 158% in Turkish lira. Evaluating average wealth growth from 2008 to 2023, the report noted that Turkey experienced a substantial increase of 1708% in local currency terms.
UBS Global Wealth Management’s Chief Economist, Paul Donovan, pointed out that being asset-rich in Turkey does not necessarily translate to being cash-rich, as real wages may not keep pace with asset value appreciation. Donovan emphasized the importance of considering living standards alongside wealth accumulation, highlighting the challenges posed by negative real income in the Turkish economy in recent years.
