Gulf financial wealth will reach $ 2.7 trillion by 2025

The New Global Annual Wealth Management Report released by the Boston Consulting Group found that the compound annual growth rate of financial wealth in the UAE has grown at an annual rate of 3% since 2015, reaching $ 600 billion. dollars in 2020, of which 69% in 2020 is the category of wealth available for investment, at a time when the United Arab Emirates market has shown exceptional resilience in the face of the ongoing Covid-19 pandemic.

Mustafa Boska, Managing Director and Partner of Boston Consulting Group, said: “Despite the challenges posed by the recent spread of the Covid-19 pandemic globally, the UAE is estimated to have been able to record a sustainable growth in many areas. in the wealth sector. .

The report states that the UAE accounted for 26% of the share of financial wealth in Gulf Cooperation Council countries in 2020, while the compound annual growth rate of its financial wealth is expected to experience a remarkable growth of 4%. , reaching $ 700 billion by 2025, an increase of $ 100 billion from 2020.

On the other hand, the report expects the volume of financial wealth in the region to reach $ 2.7 trillion by 2025, compared to $ 2.2 trillion in 2020.

Equities and investment funds accounted for the highest percentage of the category of internally managed assets in the country, as this category accounted for 47% of total internal assets in 2020, while the category of currencies and deposits is expected. constitute the largest share of internal assets. over the coming period, reaching 47% of the country’s total domestic assets by 2025.

The report expects the wealth reality in the UAE to witness remarkable changes in the years to come, with the rise of the next generation of individuals with enormous wealth. According to the report, these wealthy individuals, aged 20 to 50, have longer investment horizons, greater risk-boldness and a willingness to invest their wealth to have a positive societal impact and generate returns. students. However, the challenge in this context is the reluctance of the greater number of asset managers to provide their services to these new clients.