Why the number of millionaires is set to rise in UAE

The number of millionaires in Dubai and Abu Dhabi will increase from 440 last year to 511 in 2023 and from 192 to 223, respectively.

The number of millionaires in the UAE increased last year and this trend will continue over the next five years as growing investment opportunities will generate more millionaires locally as well as political and economic stability will also woo rich individuals and families from foreign countries, say researchers and analysts.
According to the latest report released by global consultancy Knight Frank, the number of millionaires, or high net worth individuals, in the UAE expanded 3 per cent to 53,798 last year from 52,344 in the previous year. The numbers are projected to grow 14 per cent to 61,292 by 2023. Similarly, the number of ultra-high net worth individuals (UHNWIs) - who own more than $30-million wealth - in the UAE grew from 672 in 2017 to 693 last year and will reach 799 by 2023.
The study predicted that the number of UHNWIs in Dubai and Abu Dhabi will increase from 440 last year to 511 in 2023 and from 192 to 223, respectively.
Issam Kassabieh, senior financial analyst at Menacorp, believes that the ultra-rich will continue to flock to the UAE in coming years.
"At the moment, Dubai is attractive for foreigners. Now, it is a place not just for good investments returns but also to stay for long term. Government is focusing on key sector so that the cash comes in and stays in the country through different measures such as longer visas and ease of doing business initiatives," Kassabieh said.
"The UAE is an attractive place for foreign investors - financial markets are at an early stage and have a long way to go. Real estate was the first to anchor the economy and that brought foreign investors here. Going forward, the focus will be on more diverse sectors. Also, the ease of doing business chart shows the UAE is first in the region and also competitive globally," he added.
"Dubai offers a full package - good quality of life, healthcare, education and investment opportunities. All these complement each other and attracts high net worth individuals to this country. In addition to that, diversity of population plays a big role in this," said Kassabieh.
Knight Frank data revealed that Dubai and Abu Dhabi will witness higher growth in UNHWIs as compared to Manama and Riyadh.
Raju Menon, chairman and managing partner, Kreston Menon, said the number of millionaires will undoubtedly continue growing in the UAE in coming years.
"Whatever the business challenges or revenue decline the companies are facing today, it is temporary. We need to look at long-term of 5 to 10 years. Millionaires should grow here in the UAE because money is available here so the investment avenues will be opened. The UAE's economy offer big opportunities," he said.
Menon believes that most of the new millionaires will be homegrown mainly in retail, trading, healthcare, real estate, services and shipping sectors. 
Iyad Abu Hweij, Managing Director of Allied Investment Partners, said the UAE, home to over 9.4 million residents, remains an attractive destination for HNWIs in the region.
With investor and business friendly policies, world class infrastructure and a stable outlook, HNWIs are expected to continue to grow in numbers in the country over the next coming years. Such policies and initiatives have played an important role in bolstering the confidence of investors and attracting Foreign Direct Investments in the UAE, which in turn creates jobs for a highly talented workforce,"  Abu Hweij said
Additionally, the UAE, viewed as a regional startup hub and a digital leader, continues to boast more startups than any other country in the region. Naturally, such startups attract more venture capital and private equity investments locally than anywhere else regionally, he added.
"The UAE continues to provide solid investment opportunities for investors locally and globally, which, along with a rapidly developing financial services sector, has played a catalyst like role for the growth of HNWIs in the country."
Regional performance
The number of millionaires in the Middle East with wealth below $30 million grew three per cent from 446,384 in 2017 to 459,937 last year. The number is projected to grow 18 per cent to 541,311 by 2023. Similarly, the ultra-high net worth individuals with more than $30m assets grew four per cent year-on-year to 8,301 last year. It's estimated that the number will grow 20 per cent over the next five years to 9,997.
According to Knight Frank forecast, the number of billionaires in the region will grow from 89 last year to 99 by 2023.
Globally, the number of millionaires with less than $30 million assets are projected to expand from 19.6 million in 2018 to 23.4 million by 2023, an increase of 19 per cent. While ultra rich will increase 22 per cent during 2018 to 2023 from 198,342 to 241,053.
- waheedabbas@khaleejtimes.com