Why millionaires love UAE

The UAE is very popular for migrating millionaires mainly due to the low crime rate, first-class healthcare system and low tax rates.

Led by Dubai, the UAE continues to be a magnet for the high net worth individuals (HNWIs) in 2017 with more than 5,000 millionaires mainly from India, Turkey, Saudi Arabia and Nigeria making the emirate as their second home.
Andrew Amoils, head of research at New World Wealth, revealed that the total wealth held in the UAE is $925 billion (Dh3.4 trillion) by private individuals - this includes everyone living there i.e. poor, middle class and wealthy together, an increase of 10 per cent in 2017 and up by 60 per cent over the past 10 years from 2007 to 2017.
According to New World Wealth's report, Dubai was among the world's top 14 - and only one from the GCC - cities where more than 1,000 HNWIs migrated to in 2017.
The study also rated the UAE among the safest country in the Middle East region.
High net worth individuals are generally categorised people having at least $1 million in assets. 
Source of income
Amoils revealed that these UAE-based HNWIs are generating their income from financial services (banks), professional services (law firms, consultancies), real estate, construction and transport industries.
Anita Yadav, head of fixed income research at Emirates NBD Research, said much of the earnings of HNWIs come from business income or investment income.
"There are also some senior level executive, particularly in banking and finance and oil and gas who command substantial employment income," she said.
She said the wealth of the UAE-based HNWIs is mainly invested in their own businesses.
"Dubai has a high number of small and medium businesses involved in retail and wholesale trade. Real estate is another asset class which is attractive to HNWIs. Lately, investment in financial products and commodities is also on the rise. In order to seek diversification, a noticeable segment of the HNWIs wealth is invested in overseas assets," Anita Yadav told Khaleej Times.
Akber Naqvi, executive director and head of asset management, Al Masah Capital, sees family-owned businesses as one of the main income sources for these millionaires.
"We see a lot of multi-generational family offices that were established either here in the region or in the surrounding areas like sub-continent and Africa; their evolution is similar to the evolution of the global economies - many have gone from being purely manufacturing to a more diversified portfolio of investments in various sectors of manufacturing and services.
"Their wealth investments have also evolved and from being conservative and one-asset dimensional they have started to build more diversified, dynamic multi asset portfolios that not only grow their wealth through various economic cycles but in many cases they also accentuate and facilitate their core businesses," Naqvi added. 
What attracts them to the UAE
Andrew Amoils said the UAE is very popular for migrating millionaires mainly due to the low crime rate, first-class healthcare system and low tax rates.
Akber Naqvi believes lifestyle, quality of services, modern infrastructure, ease of doing business, safe and secure place to raise a family are mainly attracting to the UAE.
However, cost-of-living needs to be managed as that could become a key deterrent, he added.
Anita Yadav of Emirates NBD Research said UAE - especially Dubai - is attractive to high net worth individuals due to tax-free income, globally central location, low crime rate, good school education, high quality medical services and good potential for investments.
Compared to other GCC jurisdictions, she said Dubai's laws and regulations are more international investor-friendly and the level of transparency is relatively high and implementation of law in the UAE is seen to be fair and reliable.
- waheedabbas@khaleejtimes.com