The UAE holds strong appeal among Western expatriates, with high quality of life and attractive investment opportunities cited as the top two reasons for moving to the region, according to a study by Lombard Odier, a global wealth and asset manager.
More than 40 per cent of Western expatriates, who participated in the survey, cited high quality of life and investment opportunities as the primary drivers for moving to the region.
“Younger HNWs primarily locate for business purposes, for example, to benefit from the region’s strong regulatory or legal framework (29 per cent) or to create a start-up (25 per cent). A quarter of expats also stated their desire to settle in the region permanently, a figure that rises to 49 per cent among those aged 51 and above,” said the study which focuses on the needs, goals and experiences of HNW expatriates living in the region.
A quarter of expats also stated their desire to settle in the region permanently, which rises to 49 per cent among those aged 51 and above.
Amer Malik, head of Middle East International at Lombard Odier Group, said in the dynamic wealth management landscape of the UAE, “the growing HNW expatriate community is increasingly seeking sophisticated and trusted advisors to help strengthen their knowledge across a range of issues, from wealth preservation and international wealth transfer to the taxation and regulatory implications of a relocation to the UAE.”
The survey points to certain challenges faced by expats in transferring wealth across borders, including difficulties in finding the right wealth manager (cited by 48 per cent of respondents), overcoming language barriers and differences in business culture (37 per cent) – particularly for younger expats aged 18-34 (67 per cent) – and concerns over losses due to market fluctuations or geopolitical risks (23 per cent). “This underscores the need for personalised private banking services that help expats acclimatise to their surroundings and understand the region’s regulatory landscape and cultural norms and sensitivities, as well as a demand for products and strategies providing downside protection in volatile markets,” said the survey report.
The report said in addition to these challenges, expats’ knowledge still holds scope for improvement, as evidenced by only 27 per cent feeling “very familiar” with the tax implications of holding wealth assets outside the UAE. Top of Form
“Moreover, 61 per cent of expats have yet to make any tax or estate planning arrangements for their children abroad, indicating a keen interest in discovering tax-efficient wealth transfer solutions. Private banks are well positioned to strengthen their understanding, given that a third (32 per cent) of expats place value on advice regarding international laws and tax regulations,” it said.
The study noted a growing interest in the expat community towards environmental, social, and governance investments, with plans to increase sustainable allocations from 14 per cent to 20 per cent within the next five years. The large proportion of expats looking to purchase property in the UAE suggests that investing in sustainable real estate may also hold appeal, both areas where a trusted banking partner can provide valuable guidance.