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Abu Dhabi emerges as new haven for billionaires seeking to protect assets

IFM_Abu Dhabi Billionaires
According to data gathered by wealth advice firm M/HQ and reported by the news agency, Abu Dhabi's financial hub now has over 5,000 SPVs, up from just 46 in 2016

The UAE capital has become the newest destination for billionaires seeking to protect their assets, as thousands of high-net-worth individuals (HNWIs) have established special-purpose vehicles (SPVs) in the Abu Dhabi Global Market (ADGM) in recent years, according to Bloomberg.

According to data gathered by wealth advice firm M/HQ and reported by the news agency, Abu Dhabi’s financial hub now has over 5,000 SPVs, up from just 46 in 2016.

According to an analysis of the hundreds of corporate filings made in the United Arab Emirates, ADGM has recorded “dozens” of HNWIs establishing SPVs in Abu Dhabi in 2023 alone. These affluent investors include Russia’s steel mogul Vladimir Lisin, India’s Adani family, Ray Dalio, the billionaire hedge fund manager, and the richest person in the cryptocurrency space, Chagpeng “CZ” Zhao.

Nassef Sawiris, the billionaire Egyptian, also announced in December 2023 that he would relocate his family office to ADGM.

A parent company’s creation of business entities, subsidiaries, or holding companies is known as an SPV. To separate financial risk, they are set up with their balance sheet.

Former corporate consultant for the Abu Dhabi free zone, Bhaskar Dasgupta, claims that the number of SPVs in Abu Dhabi is “increasing sharply.”

“High-net-worth individuals are relocating here from the BVI, Cayman Islands, Mauritius, and Singapore at an increasing rate,” he stated further.

Abu Dhabi may see an increase in wealth inflow because of the Gaza crisis. The managing partner of M7HQ, Yann Mrazek, reports that he just received a request from a Palestinian businessman who intends to establish an SPV to safeguard assets. Mrazek is headquartered in Dubai.

Numerous studies indicate that after the COVID-19 pandemic, HNWIs have been drawn to the UAE.

The UAE, Australia, Singapore, the United States, and Switzerland were the top five destinations for net inflows of high-net-worth individuals (HNWIs) in 2023, according to a survey conducted by Henley & Partners.

One of the largest numbers of millionaires ever recorded is anticipated to relocate to the UAE this year—roughly 4,500. The UAE had historically had net inflows of about 1,000 HNWIs annually before to the epidemic.

This year, India is expected to account for most migrant millionaires, with significant contributions also coming from the United Kingdom, Russia, Lebanon, Pakistan, Turkey, Egypt, South Africa, Nigeria, Hong Kong, and China. stated Henley & Partners.

One of the main factors luring HNWIs to the UAE is its reputation as a haven. The UAE’s highly diversified economy, low tax rates, first-rate healthcare system, great real estate, upscale dining and shopping, and top-notch international schools all attract HNWIs.

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