World's wealthiest end 2016 on a high, but Chinese billionaires lose amid sliding yuan

Mr Warren Buffett (above) added US$11.8 billion during the year as his investment firm Berkshire Hathaway saw its airline and banking holdings soar after Mr Donald Trump's victory.
Mr Warren Buffett (above) added US$11.8 billion during the year as his investment firm Berkshire Hathaway saw its airline and banking holdings soar after Mr Donald Trump's victory.PHOTO: BLOOMBERG

BEIJING (BLOOMBERG) - The world's wealthiest people are ending 2016 with US$237 billion (S$343.2 billion) more than they had at the start, triggered by disappointing economic data from China, British vote to leave the European Union and election of Mr Donald Trump as the new president of the United States.

However, wealth creation for Chinese billionaires turned negative for the first time since the inception of the Bloomberg index five years ago, with the country's richest losing US$11 billion in 2016 amid a slump in the Shanghai Shenzhen CSI 300 index and a 7 per cent decline for the yuan against the US dollar. 

The gains were led by Mr Warren Buffett, who added US$11.8 billion during the year as his investment firm Berkshire Hathaway saw its airline and banking holdings soar after Mr Trump's surprise victory on Nov 8. Mr Buffett, who has pledged to give away most of his fortune to charity, donated Berkshire Hathaway stock valued at US$2.6 billion in July.

The US investor reclaimed his spot as the world's second richest person two days after Mr Trump's victory ignited a year-end rally that pushed Mr Buffett's wealth up 19 per cent for the year to US$74.1 billion.

Mr Bill Gates remained the world's richest person throughout the year with US$91.5 billion. Mr Amancio Ortega, Europe's richest person and founder of the Zara clothing chain, was in second place on the index for most of the year until he ceded it to Mr Buffett in November. Mr Ortega, who dropped US$1.7 billion in 2016, is the world's third-richest person with US$71.2 billion.

France's Bernard Arnault was the sole non-American representative among the five best performers, adding US$7.1 billion to take his fortune to US$38.9 billion. His LVMH Moet Hennessy Louis Vuitton said the Chinese luxury-goods market is improving.

Oilman Harold Hamm rounded off the list adding US$8.4 billion to more than double his fortune to US$15.3 billion.

"2016's been event-driven with global news driving prices rather than fundamentals," said Mr Michael Cole, president of Ascent Private Capital Management. "The belief that Trump is going to come in and deregulate big parts of the economy is driving the markets right now."

Most fortunes outside of the US did not get the same boost from Mr Trump's victory, and were hurt by fluctuating commodities prices and the rise of the greenback, the currency used for the Bloomberg ranking. Nine of the 10 biggest decliners in 2016 were from outside the US, led by China's second-richest person, Mr Wang Jianlin, who lost US$5.8 billion. Mr Wang, founder and chairman of conglomerate Wanda Group, ended the year as the world's 21st-richest person with US$30.6 billion.

Nigeria's Aliko Dangote, the richest person in Africa, lost US$4.9 billion or one-third of his wealth as the combined effect of falling oil prices and the June devaluation of the naira pushed him to No. 112 with US$10.4 billion. Saudi Arabia's Prince Alwaleed Bin Talal Al Saud fell US$4.9 billion, a 20 per cent drop.

Alibaba Group founder Jack Ma closed the year with US$33.3 billion, adding US$3.6 billion in 2016. He dropped in and out of his place as Asia's richest person for the first four months of the year before claiming it for good in May after Alibaba's finance affiliate, which is laying the groundwork for an initial public offering expected as soon as next year, completed a record US$4.5 billion equity fundraising round.

China has 31 billionaires on the index with US$262 billion, trailing the US which has 179 billionaires who control US$1.9 trillion, and Germany, whose 39 individuals have US$281 billion. Russian billionaires also began to put the negative effects of US and European sanctions behind them, reversing the combined US$63 billion declines for 2014 and 2015 and adding US$49 billion in 2016.