Revealed: UAE, Middle East Fast Emerging As Global Capital For Private Wealth Management

The region also came to the rescue of private investors to save large fortunes amidst multi-billion losses suffered by the global wealthy – mostly the new-age tech czars – in the ongoing market bloodbath.

The planned private investments in the Gulf region are to exceed $1 trillion in a few years, lured by the surging sustainability initiatives across sectors, driving the boost of new industries, job creation, and strategic partnerships, market experts said.

This shift will create a solid base for funds and investment instruments focused on the green transition, including the expansion of hydrogen technologies and smart energy grids, they said.

The spike in the region’s investment attractiveness comes at a time when the world’s 500 richest people are estimated to have seen their combined wealth plunging by a whopping $208 billion in just a day – last Thursday, April 3 – when broad tariffs announced by President Donald Trump sent global markets into a tailspin.

The Middle East, however, was the only region where those on Bloomberg’s wealth index eked out net gains for the day.

“The Middle East is becoming a significant financial hub, with Dubai, Abu Dhabi, and Saudi Arabia emerging as key players,” Michael Reza Pacha, a wealth management expert and Founder of Index & Cie, a wealth management and financial advisory firm, told Arabian Business.

“Funding in renewable and green energy and waste management are attracting big time money that helps to build resilient infrastructure and modernise the region,” Pacha, who also runs JurisConsult International, another company specialising in wealth management and advisory services, and jointly manages several companies between the Middle East, Europe, and Africa, said.

The Middle East and North Africa (MENA) region is expected to attract over $1 trillion in renewable energy investments by 2030, according to experts who spoke at the third edition of the Sustainability Forum Middle East held in Bahrain in January this year.

Private investors flock to UAE

Market experts said the fast-growing attraction of the UAE and the wider region to private investors comes in the backdrop of the ascendance of the Middle East as a significant global financial hub, with Dubai, Abu Dhabi, and Saudi Arabia emerging as key players.

Many are also investing in artificial intelligence (AI) in the UAE and the region, they said.

Pacha said the GCC and MENA region should be more focused on bringing the most powerful and advanced AI companies to the region because it could also be a hub for entities rather than helping them grow around the world.

“I would prefer to attract them to the region and allow them to grow inside rather than outside,” he said.

As for the growing interest of private investors in the Middle East, Pacha said this is because the whole business changed in the last few years, and the UAE and Saudi Arabia managed to attract many actors and players.

“In fact, one of the biggest losers of this move is Switzerland – because they lost a lot of momentum, as did the UK, but let’s say mainly Europe lost the momentum of the financial business,” he said.

He said the Ukraine war and the UK’s move to change its neutral residency programme status also played a part in making global private investors focus on the Middle East.

“As Switzerland did not manage to keep its history of neutrality and become an ally of the other EU countries – it was a big mistake, and the UK did not maintain a neutral residency programme status – both lost a lot of momentum,” Pacha said.

Pacha said all this attraction to the UAE and the Middle East started long ago, but was boosted tremendously post-COVID and on account of how the UAE handled the post-COVID era.

“Simultaneously, the UAE and Saudi Arabia benefited from a couple of other events which happened on the other side of the world – Asia. Singapore lost momentum as well because the post-COVID era wasn’t well managed – the strict regulations made many players leave for Dubai – and Hong Kong to go back to China’s control and sovereignty,” he said.

Pacha said the UAE – and the region’s – smart move to become a hub for crypto and crypto trading has also helped in attracting large chunks of investments from the global wealthy.

“The reason why I moved to the UAE – I saw a land of opportunity; I saw the potential of this country and this region, which always followed the amazing progress and growth in the financial industry since 2010,” he said, adding that Dubai and Abu Dhabi are serious top players in the financial industry.

Pacha, who is also the founder of ENRROXS Energy & Mining, a company specialising in the research and production of mining resources and raw materials in the region, said there are other opportunities for UAE and MENA to consider – the mining industry.

“Africa was under the control of European countries, mainly France – these countries lost their momentum. I would highly recommend the UAE and GCC investments in Africa because today, only China and Chinese companies are investing in Africa – and there is a lot of potential in the mining industry in Africa,” he said.

Sustainability drives private investment

Sector experts cite the sustainability drive initiated by the UAE and other countries in the region as a major influencer for channelising private investments to the region amidst the growing trend of international investors prioritising organisations that deliver not only financial returns but also a positive social impact.

They also said the move on the part of a growing number of local businesses in the region to adopt ethical practices, responding to the expectations of major institutional investors who seek clearer rules and stronger assurances, aiding the surge in private investments.

Pacha said that just twenty years ago, environmental and social responsibility were rarely considered fundamental factors in investment decisions.

“However, the world around us is changing rapidly, and nowadays, we are witnessing significant transformations in private wealth management,” he said.

Market experts said the trend of “responsible investing” – which follows ESG (Environmental, Social, and Governance) standards – is gradually becoming a fully developed strategy for major corporations and private investors alike.

The potential for ESG investments in the Middle East and Africa regions appears particularly promising, they said, adding that the region will face continued growth in demand for clean energy and sustainable infrastructure projects.

Pacha, however, said the MENA region has to have a balanced policy in terms of environment and balance it with the necessity of industrial economy growth and business.

“If not, the industries will struggle and eventually disappear, which will not be good for the region in the long term,” he said.

The Index & Cie top executive strongly suggests that the UAE banks penetrate the European market and attract people in Europe to the region.

“Instead of waiting for them to take advantage of the MENA economy boom and growth, they [UAE banks] need to take some part of the market in Europe – instead of waiting for the Europeans to come into the market,” he said.