The UAE’s net wealth reached $2.9 trillion in 2023 while financial wealth grew by 10 percent from 2022 to 2023, versus the Middle East and Africa’s 8 percent. Global financial wealth rose at 7 percent, following a decline of 4 percent in 2022. Over the next five years, an estimated $92 trillion of financial wealth will be created globally.
“The UAE may become the sixth-largest global booking center by 2028. This potential ascent highlights the UAE’s growing importance in the international wealth management landscape and its appeal to high-net-worth individuals seeking diverse financial opportunities,” said Lukasz Rey, managing director and partner, and head of financial institutions at BCG in the Middle East.
World’s seventh-largest booking center
Boston Consulting Group’s (BCG) annual global wealth report, “Global Wealth Report 2024: The GenAI Era Unfolds” also revealed that cross-border wealth grew globally by 5.1 percent in 2023, reaching $13 trillion. In this evolving landscape, the UAE has emerged as a standout performer. Currently, the world’s seventh-largest booking center, the UAE is gearing up to overtake the Channel Islands and the Isle of Man to become the sixth-largest by 2028.
The UAE’s growth rate outpaces traditional European cross-border booking centers like Switzerland, the U.K., and Luxembourg, competing with Singapore and the U.S.
“This projection reflects broader trends in geographic diversification and wealth generation across markets. As the cross-border wealth landscape evolves globally, we anticipate shifts in the relative positions of various booking centers,” added Rey.
UAE Financial Wealth Surges
The outlook for the UAE’s financial wealth looks promising. Financial wealth increased by 7.6 percent annually from 2018 to 2023, reaching $1 trillion in 2023. Projections suggest that this growth will continue at an annual rate of 7.3 percent, reaching $1.5 trillion by 2028.
Real assets have also achieved a dynamic growth of 9.1 percent annually from 2018 to 2023 and will likely grow 8.5 percent annually to reach $3.1 trillion by 2028. Meanwhile, liabilities have remained roughly still at $180 billion and will likely stay in the same range, reaching $240 billion by 2028.
The UAE’s net wealth, which includes financial wealth, real assets, and liabilities, will likely increase from $2.9 trillion in 2023 to $4.4 trillion by 2028.
Concentration of ultra-high net-worth individuals propels growth
The financial wealth landscape of the UAE is notable due to the significant concentration of ultra high net worth (UHNW) individuals. Individuals with assets exceeding $100 million make up 29 percent of the UAE’s total financial wealth, more than double the global average of 14 percent for the same wealth segment.
This substantial share that UHNW individuals in the UAE hold exceeds the global figure and the broader Middle East & Africa region’s 23 percent. It also underscores the UAE’s increasing prominence as a hub for high-net-worth individuals.
Read: Investopia announces 4th edition of annual summit, signs 15 new partnerships
Wealth managers have massive opportunities
“In the UAE market, where 81 percent of financial wealth is investable — a number expected to climb to 83 percent by 2028 — wealth managers are staring at a massive opportunity,” Mohammad Khan, managing director and partner at BCG, explained.
Khan added that because 41 percent of onshore assets are in cash, there’s a clear need for wealth players to provide solutions and target underserved segments. This includes providing customers with access to integrated offerings such as advisory, lending products, and alternative investments catering to customers’ holistic needs.
“We will also see a greater focus by leading players in the GCC to position themselves with younger customers through greater use of digital platforms and a differentiated customer engagement model as wealth is transitioned to the next generation,” he added.
GenAI will significantly change the wealth management industry, offering ways to improve client experience and increase efficiency across the value chain. The technology shows potential in client acquisition, onboarding, servicing, and internal support.
GenAI applications can also assist in creating personalized pitch documents, speeding up know-your-customer (KYC) processes, providing instant client support through chatbots, and improving transaction monitoring by reducing false positives. Despite the potential benefits, many wealth managers are still in the early stages of GenAI adoption. While 85 percent of financial institutions believe GenAI will be highly impactful, 82 percent lack an overarching, long-term GenAI strategy and short-term implementation roadmaps.
