The UAE will attract 4,500 High-Net-Worth Individuals (HNWIs)
The UAE will be the second most sought-after destination for HNWIs in 2023, with 4,500 new millionaires expected to relocate here by the end of the year.
The UAE has consolidated its position as a destination for high-net-worth individuals (HNWIs) seeking favorable economic conditions, a luxurious lifestyle, and a thriving business environment. Securing the second place in the index of top-tier destinations for net inflows of HNWIs, the UAE’s rise as a magnet for wealth is nothing short of remarkable.
Where does the UAE stand in the global index
The UAE is expected to attract an even larger inflow of HNWIs in 2023.
Firstly, a high-net-worth individual is anybody who holds at least USD 1 million in amassed investable (liquid) assets.
In 2023, Australia is expected to have an inflow of 5,200 HNWIs, according to a Henley & Partners report, making the “Land down under” home for the largest number of millionaires on a global level.
The UAE ranks second in the index and is expected to reach the 4,500 new HNWIs milestone by the end of 2023.
On the following spots tanks Singapore, with an expected inflow of 3,200 millionaires, followed by the US, with 2,100 wealth individuals. Switzerland is projected to attract 1,800 millionaires this year, securing a spot in the Top 5 list of destinations for HNWIs.
The number of HNWIs in the UAE is expected to increase by 39% by 2026 to more than 228,000 people, according to a report last year by consultancy Knight Frank.
What are the main reasons for the inflows of HNWIs in the UAE
The UAE’s rise as a preferred destination for HNWIs can be attributed to a combination of factors that appeal to both individuals and businesses.
Economic Prosperity
The UAE’s robust economy, underpinned by its oil reserves, has undergone a successful diversification strategy that encompasses sectors such as finance, real estate, tourism, and technology. This diversification not only bolsters the nation’s economic stability but also provides ample investment opportunities for HNWIs seeking to expand their portfolios beyond traditional sectors.
Taxation Policies
One of the most alluring aspects of the UAE for HNWIs is its favorable taxation policies. The absence of personal income tax and capital gains tax provides a significant advantage for those looking to preserve and grow their wealth.
Business-Friendly Environment
Entrepreneurs and business magnates are drawn to the UAE’s business-friendly environment, exemplified by free economic zones, streamlined bureaucracy, and an infrastructure that supports innovation and growth. The UAE’s strategic location at the crossroads of global trade routes only adds to its appeal as a hub for international business.
Lastly, The United Arab Emirates’ cultural diversity, lifestyle and unmatched safety add to its appeal as a destination for affluent people.
Furthermore, the UAE manages to attract more HNWIs only due for its lifestyle; they recognize the country as a fertile ground for investment diversification.
1. Real Estate: The UAE’s real estate sector has flourished, with iconic skyscrapers and innovative architectural marvels dotting its skyline. From Dubai’s Palm Jumeirah to Abu Dhabi’s Saadiyat Island, HNWIs have a plethora of high-end properties to choose from, offering potential appreciation in value and rental income.
2. Finance and Banking: The UAE’s well-established financial services sector, bolstered by a range of international and local banks, investment firms, and asset management companies, provides HNWIs with tailored financial solutions and wealth management services.
3. Entrepreneurship: The UAE’s commitment to fostering entrepreneurship is evident through initiatives like Dubai’s Silicon Oasis and Abu Dhabi’s Hub71. These hubs attract startups and innovators, creating investment opportunities for HNWIs seeking to support and collaborate with promising ventures.
On the flip side, the Henley & Partners report anticipates that China will witness the most substantial outflow of millionaires on a global scale, reaching 13,500 individuals. Following closely, India is projected to see 6,500 millionaires leaving the country, while the UK is expected to record an outflow of 3,200 millionaires. The report also indicates that Russia is poised to experience an exodus of 3,000 high-net-worth individuals.