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Abu Dhabi Global Market issues 1,271 new licences in H1 2024

Assets under management surged 226% during the period

A total of 1,271 new licences were issued by the Abu Dhabi Global Market (ADGM), the international financial centre (IFC) of the UAE’s capital, at the end of June 2024 — 20.5 per cent more licences than a year earlier, data showed on Wednesday.

The asset management sector within ADGM continues to thrive, with a notable surge in AUM, global asset managers, firms and funds being anchored. In the first six months of 2024, AUM grew by 226 per cent compared to the same period last year. By the end of June 2024, the number of fund and asset managers operating in ADGM reached 112, managing 141 funds.

While asset management continues to lead the growth of ADGM, additional financial services entities across banking, payment services, wealth management and insurance sectors have also joined the ADGM ecosystem by receiving either an FSP or an IPA. The list of granted FSPs within these sectors includes Barrenjoey, Deutsche Bank AG, Fidelis OPCO, Laser Digital, and Paxos Issuance MENA. Prominent list of names that received an IPA includes Oyster Reinsurance Brokers, and SMBC Bank International, among others.

As the fastest-growing financial centre and the only jurisdiction with the direct application of the English Common Law in the region, ADGM’s consistent achievements and strategic initiatives are a catalyst to the growth of Abu Dhabi’s financial sector growth.

The momentum of ADGM bolsters the financial sector’s contribution to Abu Dhabi’s non-oil economy, which grew to 9.7 per cent in Q1 2024. ADGM is increasingly becoming a global magnet for asset management firms, outstanding talent, and investments, and is a cornerstone in cementing Abu Dhabi’s position as the ‘Capital of Capital’.

Ahmed Jasim Al Zaabi, Chairman of ADGM said, “As a catalyst for Abu Dhabi’s financial sector, ADGM’s remarkable growth in the first half of 2024 fosters Abu Dhabi’s position as a premiere hub and a destination of choice for global, regional and local corporations and financial institutions. ADGM’s strategies have been aligned with Abu Dhabi’s visionary leadership to position the UAE’s capital as a leading international financial centre. Through the establishment of a thriving ecosystem and our pursuit of innovation, excellence, and strategic development, we are proud to have propelled towards the exceptional success of realising the ADGM Growth Strategy 2023-2027 targets, underscoring the accelerated growth of Abu Dhabi’s financial industry.”

He added: “ADGM’s contribution to Abu Dhabi’s stature as a global financial powerhouse and its sustainable economic growth will continue to capitalise on opportunities that will further elevate Abu Dhabi’s Falcon Economy to unprecedented heights throughout this exceptionally successful year and beyond.”

One of the factors that has supported ADGM’s strong growth in H1 2024 is the significant increase in operational entities, which have risen to 2,088, including 231 financial services entities – a 31 per cent increase compared to H1 2023. This growth is also complemented by the number of Financial Services Permissions (FSP) granted in the first six months, equivalent to 42 – a growth of over 90 per cent compared to the June 2023 numbers which stood at 22.

In May 2024, ADGM hosted the second edition of the UAE-France Investors Meetup – an exclusive gathering, led by His Excellency Bruno Le Maire, the French Minister of Economy, Finance, and Industrial and Digital Sovereignty and attended by 24 French Asset Management firms with USD 1.6 Trillion AUM. The Meetup represented a unique opportunity for stakeholders in both countries to forge strategic alliances, identify new opportunities, and drive mutual growth. It reaffirmed Abu Dhabi’s position as a global financial hub and underscored the enduring strength of the Franco-Emirati partnership.

In its efforts to continue expanding its international positioning, ADGM conducted a series of roadshows in the first half of 2024, covering multiple countries and regions including the USA, Europe, Hong Kong and the Chinese subcontinent.

Blockchain innovation

Following the introduction of the distributed ledger technology (DLT) foundations regulations, ADGM has signed strategic partnerships with a couple of organisations in 2024. The first one was with the Solana Foundation, a non-profit organisation dedicated to decentralisation, adoption, and security on the Solana network to enhance DLT solutions and advance blockchain innovation. Another Memorandum of Understanding (MoU) was signed between ADGM and Hacken, a global leader in blockchain security auditing to collaboratively set new benchmarks for blockchain security and compliance as well as on-chain monitoring solutions in relation to ADGM’s DLT Foundations framework, positioning both organisations at the forefront of fostering a secure blockchain ecosystem.

Workforce booms

The workforce within ADGM’s Al Maryah Island has increased by more than 2,500 individuals, compared to the end of June 2023, and are now part of ADGM’s vibrant community.

The number is expected to maintain strong growth in 2024 in line with the positive responses received from a comprehensive outlook survey conducted in the first half. A total of 70.81 per cent of companies anticipate expanding their workforce in ADGM during 2024, with 29.93 per cent expecting significant increases and 40.88 per cent planning moderate growth in staffing.

Residential surge

Since the announcement of the expansion in April 2023, Al Reem Island has seen the introduction of 1,266 new residential units, bringing the total to 21,335 units. The growth in occupancy rates has remained steady, rising from 84.78 per cent in March 2023 to 92.82 per cent by the end of June 2024. Moreover, with ADGM’s exceptional growth, many employees of the new companies established within ADGM’s jurisdiction are choosing Al Reem Island as their place of residence. ADGM’s jurisdiction over both Al Maryah and Al Reem Island highlights its exceptional qualities, making it an ideal location to live, work, and conduct business.

In addition to regulatory amendments supporting existing Al Reem Island businesses, ADGM has launched an information centre in Shams Boutik Mall and organised two community events in 2024, one in March and another in July. These initiatives were implemented to engage with the Al Reem Island business community, provide essential updates on licensing, registration fees, and transition processes as well as foster interactive dialogue and collaboration among stakeholders. ADGM also introduced an incentive initiative for existing non-financial and retail businesses on Al Reem Island, exempting them from paying any fees for obtaining an ADGM commercial licence providing they apply before 31st October 2024.