SINGAPORE will leapfrog Hong Kong to have the highest concentration of millionaires in the world in 10 years, a new Barclays Wealth report says.

A total of 40.7 per cent of all households in the Republic, or 436,000 households, are set to boast net wealth in excess of US$1 million (S$1.36 million) by 2017.

That means two out of every five households in Singapore are projected to be millionaires by then. The report looks at the combined wealth of household members.

The data used measures aggregate wealth, financial wealth such as currency, deposits, loans and insurance, as well as non-financial wealth such as property and land. Liabilities are subtracted from the total.

Last year, Singapore ranked second with 23.3 per cent, behind Hong Kong's 26.4 per cent. In 2017, Hong Kong is expected to register 39.4 per cent, ahead of Switzerland, which maintains its current third ranking.

Barclays Wealth, the leading wealth manager in Britain, said Singapore's efforts to move away from manufacturing into higher value-added activities like technology and financial services had helped its rise.

Mr Didier von Daeniken, Asia-Pacific chief executive of Barclays Wealth, said at a press conference yesterday that the opening of previously protected sectors, such as financial services, and various free trade agreements had also helped Singapore's cause.

He added that Singapore's future millionaires would likely come from a growing number of rich entrepreneurs.

The report, by Barclays Wealth and the Economist Intelligence Unit, said wealth held by high net worth Singapore households, defined as those with more than US$1 million, could hit US$1.6 trillion.

Mr von Daeniken said this presented great growth opportunities for private banks. 'Asia now represents 25 per cent of high net worth individual wealth globally, 60 per cent of the world's population, but only about 10 per cent of the income of the major private banks.'

This article was first published in The Straits Times on May 7, 2008

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