SINGAPORE: In recent days some major companies have suggested that they have overestimated the advance of the middle class in Africa and Latin America but the numbers in this group are set to almost double in Asia.
Figures reported by Media Business Asia suggest that the proportion of South and Southeast Asia's population fitting Nielsen's definition of middle class – people with enough money to choose what they buy, equating to at least US$16 in daily disposable income – will roughly double between 2012 and 2020.
Some 210m people will have been added to the middle class consumer pool over this period, taking it to 400m and making it the majority across the region, as it will account for 55% of the total population, compared with just 28% in 2012.
The increase is even more dramatic in India, where the middle class is expected to grow 157%, from 210m to 540m. This increased affluence means that the middle classes will make up 39% of India's population in 2020, up from 17% in 2012.
China has already taken major steps towards raising living standards and the 800m-strong middle class there will grow rather more slowly, at just 25%. That still means a total of 1bn people will be classified as middle class by 2020.
Over all three regions, the middle classes will therefore grow 62% in the eight year period to a total of 1.94bn.
The picture elsewhere is not quite so bright, however, as food giant Nestlé recently made clear when announcing a 15% cut in its workforce across 21 African nations
"We thought this would be the next Asia, but we have realised the middle class here in the region is extremely small and it is not really growing," Cornel Krummenacher, chief executive for Nestlé's equatorial Africa region, told the Financial Times.
And SABMiller, the world's second largest brewer has just cut its growth forecasts for Latin America, relating a similar tale.
Randy Ransom, svp/ marketing and innovation in Latin America, told investors that while the middle class had grown, it was "not to the degree that we would have liked, nor to the degree that we had forecasted a few years back".
Data sourced from Media Business Asia, Financial Times; additional content by Warc staff