In Nicaragua 42.5 percent of the country lives below the poverty line but 210 ultra-wealthy individuals control a combined fortune of $30 billion, equal to 2.5 times the country's annual economic output.
Latin America, a region of some 600 million people, is home to nearly 15,000 "ultra high net worth" individuals, or people with fortunes of at least $30 million, according to luxury industry consultancy Wealth-X. The number rose five percent last year, while the number of billionaires rose to 151, a 38 percent increase. That was the fastest growth rate for billionaires of any region on Earth. The ultra-wealthy have varied profiles, from Mexican telecoms magnate Carlos Slim, whose $77 billion fortune is the second-largest in the world according to Forbes, to Brazilian beer magnate Jorge Paulo Lemann (net worth: $25 billion), Chilean mining scion Iris Fontbona ($13.5 billion), to Colombian banker Luis Carlos Sarmiento ($13.4 billion). What is clear is that their numbers are growing, in some cases because family fortunes have been divided up among heirs, said Mykolas Rambus, the chief executive of Singapore-based Wealth-X.
Ensconced behind the high walls of their luxury villas, the mining magnates, telecoms tycoons, large landholders and others who make up Latin America's uppermost crust can be less visible than the region's poor. Their lavish lifestyles and growing numbers are attracting keen interest from the global luxury industry, eager to expand to new markets and court new customers in existing ones. Natixis Global Asset Management, a firm that specialises in managing large fortunes, recently launched its first Latin American offices in Mexico City and Montevideo. According to market research firm Euromonitor, the Latin American luxury market will total $26.5 billion in 2019, up 88.8 percent from 2014 -- the strongest growth in the world.
Porsche is one example. Since arriving in Latin America 15 years ago, the German sports car maker has increased annual sales to the region from less than 300 vehicles to nearly 3,900 vehicles, said George Wills, president of Porsche Latin America. The region's largest economies, Mexico and Brazil, remain the "volume drivers," he said. "But if you look in terms of the markets themselves, the markets that are enjoying good growth are markets like Peru, Colombia, Panama... with 60 percent growth in some of them."
Mexico is the world's second-largest market for private jets, behind the United States, with Brazil poised to surpass it within the next decade, according to a recent market study by Brazilian jetmaker Embraer.
"The main characteristic of inequality in Latin America is not that there are a lot of poor people, but that there are a few people who have a lot," said Juan Pablo Jimenez, an economist at the UN's Economic Commission for Latin America. Moreover, the latter "pay very low taxes, both in international terms and compared to what they are supposed to pay," he said. "Taxes on wealth are very low in Latin America, and inheritance taxes are almost nonexistent."
Ecuador's President Rafael Correa had to back down last week from plans to start taxing inheritances of more than $35,400 after an outcry from the business world.