The Rise of Financial Growth and Generational Wealth Transfer in the GCC Region
The Gulf Cooperation Council states are on track to solidify their status as a hub for global fortunes, with financial growth, a coming generational wealth transfer, and an influx of high-net-worth individuals contributing to the region’s appeal as a fortune hub.
According to Boston Consulting Group, the region’s financial wealth is expected to grow by 4.7% annually by 2027, reaching $3.5 trillion, up from $2.8 trillion in 2022. This growth is attracting private wealth managers to the region, with hundreds of private banks, asset management firms, and family offices already established in the GCC.
The shift towards generational wealth transfer is also evident, with over 70% of the region’s private wealth currently held in offshore accounts. Local legislation is evolving to facilitate this process, with an estimated $1 trillion of assets expected to change hands in the Middle East by 2030.
In addition to fortunate heirs, the GCC is also attracting the globalized wealthy, with the UAE seeing a significant influx of millionaires seeking a safe haven for their fortunes and new business opportunities. To attract new high-profile residents, GCC governments have introduced reforms to labor laws, residency programs, golden visas, and ownership rules.
Local lenders are rising to the challenge posed by international financial institutions in the private wealth and asset management sector. Strategic alliances with international partners and a focus on specialized services, customer experience, and innovative solutions are helping local managers compete in the market.
As the region’s regulatory environments continue to evolve, GCC asset managers are looking towards financial innovation, including blockchain technologies and green finance initiatives. With the outlook for GCC asset managers looking positive, the region is poised to expand into new markets across Africa and Asia, tapping into emerging nodes of high-net-worth individuals.