United Arab Emirates: the new Eldorado for millionaires?
An unprecedented flow of millionaires
According to Henley & Partners (an international consultancy specializing in residency and citizenship by investment) and its "Private Wealth Management" report on millionaire migration trends in 2024, the UAE is set to attract 6,700 new millionaires this year. This affluence is mainly due to the absence of income tax, combined with initiatives such as the golden visa program, which offers considerable advantages to foreign investors.
The famous city of Dubai, for example, has seen its millionaire population increase by 78% over the past decade.
By comparison, the USA and Singapore, respectively second and third in Henley's rankings, are expected to attract significantly fewer millionaires this year, with net inflows of 3,800 and 3,500 millionaires.
Other countries, such as China, are experiencing millionaire exoduses and are expected to lose 15,200 millionaires, mainly due to a desire to seek better infrastructure and opportunities. The UK, meanwhile, could see an exodus of 9,500 millionaires this year, a figure compounded by post-Brexit uncertainty and changes in the non-dom tax regime.
As we've seen, the migration of millionaires is constant, and they're heading for Dubai in massive numbers.
So, to better understand the consequences of these arrivals, it's legitimate to ask about the economic and social impact caused by these flows.
Millionaires at the service of a booming society
The arrival of these millionaires in the United Arab Emirates has major repercussions for the country's economy. On the economic front, for example, GDP growth will be sustained by a 44% increase in real estate transactions in 2023. Meanwhile, in the same year, foreign direct investment (FDI) reached $16 billion, an increase of 7.4% on the previous year. And the benefits don't stop there : the luxury goods, finance and technology sectors have particularly benefited from this influx. For example, sales of luxury goods rose by 20% in 2023 and the financial industry created over 10,000 new jobs. On a societal level, the influx of millionaires has contributed to Dubai's cultural diversity, with over 70 nationalities now represented among the new wealthy residents. Another example, this time in the field of education and health, is the allocation of an additional $2 billion to improve public schools and hospitals through increased tax revenues in 2023.
The role of the Dubai International Financial Centre (DIFC) in attracting millionaires
DIFC plays a central role in making the United Arab Emirates attractive to investors. As the leading special economic zone dedicated to financial services in the Middle East, the DIFC offers a regulatory and governance environment in line with international standards. With over 2,500 registered companies and a dynamic ecosystem for banks, insurance companies and asset managers, the DIFC is a key platform for regional and global expansion. For example, it has an independent legal framework based on English common law, providing companies and investors with a high level of transparency and legal certainty. It also offers tax exemptions on corporate and personal income for a period of 50 years, making investment in the center extremely attractive for millionaires looking to maximize their income.
As a result, the United Arab Emirates, and more specifically Dubai, is becoming the new center of gravity for millionaires investing on a massive scale to transform the UAE economy.
Sources :
https://www.pauljorion.com/blog/2022/06/17/ou-vont-les-migrants-millionnaires/
