China is now the richest nation in the world, according to the latest report by McKinsey & Co.
While its numbers showed that global wealth grew by three times in the last 20 years, the report said that China led the way in that growth and surged ahead of the United States to attain the number one spot on the list of the world's richest countries, reports Bloomberg.
Management consulting company McKinsey & Co said in a report that examines the national balance sheets of ten countries representing more than 60% of the world's income.
Net worth worldwide rose to $514 trillion in 2020, from $156 trillion in 2000, according to the study.
China accounted for almost one-third of the increase. Its wealth skyrocketed to $120 trillion from a mere $7 trillion in 2000, the year before it joined the World Trade Organisation, speeding its economic ascent.
The US, held back by more muted increases in property prices, saw its net worth more than double over the period, to $90 trillion.
In both countries -- the world's biggest economies -- more than two-thirds of the wealth is held by the richest 10% of households, and their share has been increasing, the report said.
As computed by McKinsey, 68% of global net worth is stored in real estate. The balance is held in such things as infrastructure, machinery and equipment and, to a much lesser extent, so-called intangibles like intellectual property and patents.
The steep rise in net worth over the past two decades has outstripped the increase in global gross domestic product and has been fueled by ballooning property prices pumped up by declining interest rates, according to McKinsey. It found that asset prices are almost 50% above their long-run average relative to income. That raises questions about the sustainability of the wealth boom.