According to a report by Henley and Partners (an investment migration consultancy), United Arab Emirates has emerged as the most favoured destination for high net-worth expats. Said the report: “For the third year running, the UAE looks set to take first place as the world’s leading wealth magnet, with a record-breaking 6,700 moneyed migrants expected to make the Emirates home by the end of the year, significantly boosted by large inflows from the UK and Europe.”
An estimated 1.28 lakh High Net worth Individuals (HNI’s) – defined as individuals with liquid assets of $ 1 million — are likely to move to another country this year. The UAE is likely to see an inflow of 6,700 millionaires this year.
The US is the second most attractive country for HNI’s, while Singapore is third. Countries with the highest outflow of millionaires are – China (15,200), UK (9,500) followed by India (4,300). While Asian countries have been witnessing an outflow of millionaires, the outflow from UK has been driven by several economic and political factors.
Why UAE is attractive
According to the report, UAE is attractive due to a myriad of factors – the fact that UAE is tax efficient, has world class infrastructure and is strategically located. UAE’s location and impressive air connectivity with different parts of the world are decisive factors for businessmen especially from South Asia – especially India. It would be pertinent to point out, that in the aftermath of covid, UAE was one of the first countries to relax rules for travellers and this gave a strong boost to the Gulf nation’s economy (UAE’s tourism sector was amongst the first to bounce back globally as a result of the Expo 2020 held in Dubai from October 2021 to March 2022). The Henley and Partners report also makes a mention of UAE’s “golden visa” – a long term residence visa which seeks to attract entrepreneurs as well as highly skilled individuals — as being one of the key reasons for the Gulf nation becoming an attractive destination.
For HNIs from India, UAE has been attractive for several reasons and the UAE’s Golden Visa and its emphasis on attracting immigrants who can contribute to its economic growth means that for several Indians who have other options, UAE is the first preference. Seeing the rise in Indian HNI’s migrating to UAE, several Indian banks have expanded their operations in the Gulf nation.
UAE’s foreign policy
UAE’s reasonably balanced foreign policy has also stood it in good stead economically. The Gulf nation shares good ties with both US and China. The Comprehensive Economic Partnership Agreement (CEPA) with India has also further strengthened economic ties with India — with bilateral trade getting a strong fillip. UAE has entered the China dominated BRICS+ and like several other countries has also been looking towards de-dollarization – trade in local currencies and reduction of dependence upon the US dollar. It would be pertinent to point out that UAE’s growing links with China, especially in tech have not gone down well with the US. Recently, UAE’s Artificial Intelligence Minister clarified that there will be “complete alignment between the UAE and US” as far as the AI front is concerned.”
UAE’s increasing emphasis on Soft Power
While UAE for long has focused on attracting immigrants as a part of its economic vision, in recent years it has also begun to look at drawing talent which can contribute towards strengthening the countries Research and Development as well. The Henley report makes a mention of how the UAE’s Golden Visa “provide long-term residence to investors, entrepreneurs, specialists, students, and researchers who make a significant investment to the country.”
The fact that the pool of expats is diversifying adds to the cosmopolitanism as well as the goal of UAE strengthening its ‘Soft Power’. For long, the UAE has been a favoured destination for rich expats from the Middle East, India, Russia and Africa. It has also begun to attract expats from UK and Europe.
Here it would be pertinent to point out that UAE was ranked 10th in the Global Soft Power Index compiled by Brand Finance. One of the key factors for UAE’s high ranking was its stable economy. UAE’s focus on emerging as a sports centre is also bolstering its Soft Power.
In conclusion, UAE emerging as a top destination for millionaires is important for several reasons. Not only will it give a boost to the Gulf nation’s economy and align with the country’s Vision but also strengthen its “Soft Power” and enrich its society. UAE’s approach vis-à-vis immigrants also reiterates the point that while globalization may no longer be driven by western countries, it is irreversible.
[Image by Ronald Sagarino from Pixabay]
The views and opinions expressed in this article are those of the author.
Tridivesh Singh Maini is a New Delhi based analyst interested in Punjab-Punjab linkages as well as Partition Studies. Maini co-authored ‘Humanity Amidst Insanity: Hope During and After the Indo-Pak Partition’ (New Delhi: UBSPD, 2008) with Tahir Malik and Ali Farooq Malik. He can be reached at [email protected].
