Credit By: Aletihad Newspaper
A growing number of wealth managers in Asia are establishing offices in Dubai, capitalizing on warming diplomatic ties between China and the Middle East and anticipating a surge in demand for geographical diversification from their clients.
Dubai Emerging as a Preferred Wealth Hub:
Dubai is becoming a preferred wealth hub for entrepreneurs and wealthy families in Asia, especially China. The city’s favorable policies, growing opportunities, and geopolitical considerations attract wealth managers seeking diversification to serve clients.
Noah Holdings Expanding to Dubai:
Noah Holdings, one of China’s top wealth managers, overseeing around $23 billion in client assets, expects to obtain a business license in Dubai by the end of the year. The Dubai office will cater to Chinese entrepreneurs establishing businesses in the Middle East.
Chinese Entrepreneurs Seeking New Markets:
Many are exploring new markets and diversifying their supply chains. With its post-COVID economic rebound, neutral political stance, ease of doing business, and tax-free status, the Middle East is seen as an attractive region for investment.
Middle East’s Growing Importance to Beijing:
The Middle East has gained significance in China’s global strategy, especially as its relations with the United States have faced challenges. The Middle East’s economic incentives and geopolitical neutrality make it an attractive destination for wealth management activities.
Incentives and Initiatives:
The United Arab Emirates (UAE) has introduced initiatives like the ‘golden visa’ system. Dubai has launched a ‘family wealth center’ to assist wealthy individuals and businesses with cultural issues and governance.
Western Wealth Managers Expanding:
Western wealth managers, including Swiss private bank Lombard Odier, are also expanding their presence in the region, aiming to tap into the growing population of rich individuals and expatriates.
Diversification Beyond Hong Kong and Singapore:
While Hong Kong and Singapore have traditionally been Asia’s preferred offshore wealth hubs, clients are now seeking diversification into other markets and exploring new investment opportunities.
Rising HNWI Population in the Middle East:
Despite a global decline in high-net-worth individuals (HNWI), the Middle East experienced a 2.8% increase in its HNWI population in 2022. The UAE witnessed the highest net inflow of millionaires globally in 2022.
Multi-Family Offices Expanding:
Multi-family offices, such as Farro Capital and Landmark Family Office, are setting up offices in Dubai to help clients based in China, Southeast Asia, and Australia find investment opportunities in the Middle East.
Geopolitical factors are crucial in families’ wealth management decisions, making Dubai an attractive destination. The city’s regulatory initiatives, including regulating virtual assets, further contribute to its appeal.
The trend underscores the shifting dynamics in the wealth management landscape, with Dubai emerging as a key player in providing financial services to clients seeking global diversification.
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