UAE’s financial advisory market volume to exceed AED 875 bn in 2023

Dubai on pace to rank in top 20 wealthiest cities in the world by 2030
UAE’s financial advisory market volume to exceed AED 875 bn in 2023
Financial advisory

Following UAE’s ultra-high-net-worth individuals (UHNWI) population increasing by 18% in 2022, the country’s UHNWI demographic is projected to grow at a CAGR of nearly 6% through the next five to seven years. What is driving this growth and why is UAE’s financial advisory market estimated to reach a market volume of almost AED 875 billion expected by end 2023?

Home to over 200 different nationalities, the UAE has typically seen migration inflows of 1,000 high-net-worth individuals (HNWIs) per year. However, last year the country welcomed over 5,200 people from this tax bracket. This strong growth is set to sustain in 2023 with industry analysts setting an expectation that 4,500 millionaires will move to and permanently reside in the nation. For over 50 years, the UAE has laid the groundwork for such an evolution but COVID-19 appears to have accelerated this progress.

Spearheaded by HH Sheikh Mohammed Bin Zayed AL Nahyan’s wise leadership, the UAE’s deft handling of COVID-19 demonstrated the country’s ability to foster safety and security while also protecting residents’ best interests and the nation’s economy. These efforts garnered global attention to attract affluent investors from all over the world. In turn, a strong influx of wealth has entered the country over recent years, and this trend should hold steady with Dubai on pace to be one of the top 20 wealthiest cities in the world by the end of 2030.

Read: UAE’s Ministry of Finance’s strategic role in public finances strengthened fiscal planning

As the emirate strives towards achieving this ambitious projection, the wealth of HNWIs and UHNWIs will play a significant role. Data shows that assets under management (AUM) in the UAE’s wealth management market are forecasted to reach upwards of AED 938 billion in 2023 while showing a CAGR of 10% to result in a market volume of nearly AED 1.4 trillion between now and 2027.

Bas Kooijman, CEO and Asset Manager of DHF Capital S.A., explained: “According to the GlobalData Country Risk Index, the UAE is a low-risk nation that ranks 10th out of 153 countries worldwide. Meticulous management of the coronavirus pandemic, alongside proven stability through times of turbulence such as the financial crisis in the early 2000s, have amounted to this reputable status. This is a driving force behind why the world’s highly affluent are flocking to the UAE – the country provides an ideal environment for safeguarding and growing investors’ assets.”

Overseas turmoil has seen HNWIs and UHNWIs from countries like China and India, among other nations, make their way to the UAE in increasing numbers. Many of these expatriates have pinpointed Dubai as a means of safeguarding and growing their assets.

For more banking and finance stories, click here.