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Written by Xie Yu and Yantoultra Ngui
HONG KONG/SINGAPORE (Reuters) – A number of Asian asset managers are opening offices in Dubai, taking advantage of growing diplomatic ties between China and the Middle East and betting on a surge in client demand for geographic diversification. There is.
Dubai, a major financial hub in the Gulf region, has emerged as a preferred wealth hub for many entrepreneurs and wealthy individuals in Asia, primarily China, looking to take advantage of favorable policies and expand their businesses. wealth managers said.
For example, Noah Holdings, one of China’s leading asset management firms that manages about $23 billion in client assets, plans to obtain a license to operate in Dubai by the end of this year, said Qin Pan, the company’s chief financial officer. Told.
He said the Dubai office will serve Chinese entrepreneurs setting up businesses in the market.
“Noah’s strategy has followed the growth of customers’ wealth. Therefore, we have to be on the ground and take care of the wealth created locally,” Pan said, adding that the company will first bring staff from China. He added that the plan is to dispatch staff and then hire them locally. .
“Many Chinese entrepreneurs are looking for new markets and diversifying their supply chains, and many are excited about the opportunities the Middle East offers.”
The Middle East has become increasingly important to China as relations with the United States deteriorate amid disagreements on issues ranging from trade and technology to human rights and Taiwan.
Economic recovery post-COVID-19, neutral political stance, ease of doing business, convenient time zones, and tax-free status have all helped attract large numbers of wealthy people to the Middle East in recent years. There is.
The United Arab Emirates (UAE) has recently introduced preferential treatment such as the “Golden Visa” system. Last year, Dubai launched a Family Wealth Center to help wealthy individuals and businesses address cultural issues and governance.
As a result, Western wealth management companies, including Swiss private bank Lombard Odier, are looking to expand their business presence in the region to take advantage of the influx of foreigners and the growing wealthy population.
investment opportunity
In Asia, Hong Kong and Singapore have long been the most preferred offshore wealth hubs for the wealthy. However, some clients are now looking to diversify into other markets and take advantage of new investment opportunities, the wealth managers said.
According to Capgemini’s 2023 Wealth Report, the number of high net worth individuals (HNWIs) worldwide decreased by 3.3% to 21.7 million in 2022, while the Middle East’s HNWI population grew by 2.8% in the same year.
The UAE will record the world’s highest net inflow of millionaires in 2022, and become the center of private wealth by 2023, according to data from Dubai-based wealth and immigration advisor Henley & Partners. It is estimated that there will be a net influx of an additional 4,500 people.
Betting on this trend, Singapore-based multifamily office Faro Capital opened an office in Dubai last month. Patrick Tsang, chairman of Hong Kong-based private office firm Tsang Group, said his firm plans to open new offices in Abu Dhabi and Riyadh, Saudi Arabia, this year, following its expansion into Dubai in 2022.
Hong Kong-based Landmark Family Office also plans to open an office in Dubai in the coming months. Landmark founder and CEO Cameron Harvey said the company’s Dubai office will be used to help clients based in China, Southeast Asia and Australia find investment opportunities in the Middle East. He said it would be done.
A recent survey of 76 single and family offices based in Asia Pacific by Camden Wealth & Raffles Family Offices found that respondents had an average asset allocation of just 1% to the Middle East region. It was found that 7% of respondents plan to increase their allocation.
“We live in very interesting times, where geopolitics is becoming more important to families than ever before,” said Manish Tibrewal, co-founder of Faro Capital in Singapore. He added that the promotion of virtual asset regulations and the golden visa system are having an impact. This made it even more appealing.
(Reporting by Xie Yu in Hong Kong and Yantultra Ngui in Singapore; Editing by Sumeet Chatterjee and Muralikumar Anantharaman)
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