Outlook 2025
Outlook 2025: Redefining global wealth and investments in the Middle East
The Middle East is fast emerging as a cosmopolitan capital of global finance, attracting diverse families and institutions seeking stability, innovation, and opportunity.
Speaking to LC IDEAs: Views & Insights, Prashant Tandon, Managing Director & CEO, UAE, Lighthouse Canton shared his 2025 outlook for the Middle East on four critical themes shaping the region: the consolidation of wealth management industry, UAE’s rise as a global financial hub akin to Singapore and Hong Kong, its strategic focus on healthcare, education, and financial markets, and the the democratisation of private markets which is happening at a noteworthy pace in the region.
CONSOLIDATION AND INCREASED GOVERNANCE
"The wealth management segment is undergoing two core changes: consolidation and increased governance," Tandon observed.
This shift is being driven by a combination of market pressures and evolving client expectations.
“With 2025 expected to bring continued market challenges, fringe players in the wealth management and family office space may face increased pressure. This could lead to some exiting the market or seeking consolidation opportunities with larger, more established firms like Lighthouse Canton,”shared Tandon.
The transformation within wealth management is also closely tied to the changing demands of ultra-high-net-worth clients in the region.
"Many high-quality finance professionals have gone independent or joined outfits like Lighthouse Canton, and along with them have come high-quality clients," Tandon said. These clients, accustomed to working with large institutions, now expect their wealth managers to provide similar infrastructure, service delivery, and governance framework.
This evolution ties well Middle East’s aspiration to grow as a global financial hub, as the region has actively fostered an ecosystem conducive to institutional standards.
As an example Tandon pointed to the rapid growth of the Dubai International Financial Centre (DIFC) as evidence of this transformation.
"The number of businesses registered in the DIFC has grown almost in excess of 3x in the last seven years," he noted. This surge includes hedge funds, family offices, and other financial institutions that are drawn to the UAE’s regulatory frameworks and infrastructure.
Abu Dhabi also has also emerged as a standout player in this period. "Abu Dhabi is now called the ‘capital of capital,’ and that says it all," Tandon said. This reputation is bolstered by its strategic infrastructure investments and policy-driven growth.
The increased focus on governance and institutional rigour is also a testament to the Middle East’s commitment to becoming a trusted destination for global wealth.
"This ecosystem is no longer just about scale," Tandon explained. "It’s about creating a framework that combines global standards with local innovation, ensuring clients receive unmatched service and oversight."
A COSMOPOLITAN OF FINANCE
"From an economic life cycle perspective, the UAE is right now where Singapore was some years back," Tandon remarked, drawing a parallel to Singapore’s transformation into a global financial hub. "A lot of Chinese families, Korean families, European families, and UK families are now calling the UAE home. South Asians have always been here, but the demographic is diversifying rapidly."
This diversification is supported by favourable geopolitical and regulatory conditions. Numbers support the narrative. As per a Financial Times report of 2024, thousands of millionaires were projected to leave China and UK in 2024 and the UAE is expected to be the biggest beneficiary of this move.
Recent changes to UK tax laws have prompted wealthy families to consider relocating, with many choosing the UAE over destinations like Singapore or Hong Kong. The UK's decision to abolish the non-domicile (non-dom) tax status, has been a significant catalyst for this movement. Under the new rules, foreign income and gains will become taxable after four years of UK residence, removing the previous remittance basis that allowed non-domiciled individuals to pay taxes only on income brought into the UK.
"April 2025 is the deadline by which the UHNWI and HNWI have to decide, and for many, the UAE works best," Tandon noted.
This is as the UAE offers a more favorable tax environment for HNWI. The country imposes no personal income tax, capital gains tax, or inheritance tax, making it an attractive destination for those seeking to preserve their wealth. Additionally, the UAE's Golden Visa program provides long-term residency options for investors and entrepreneurs, further enhancing its appeal.
Knight Frank’s Wealth Report 2024 also supports this trend, the UAE has seen a 6.2% rise in ultra-high-net-worth individuals (UHNWIs) in 2023, the second-highest growth globally, reflecting its enhanced appeal to global investors.
Historically, the region’s wealthy investors favoured private markets over public ones. "The bulk of the investment made by the local diaspora has always been in private markets," Tandon noted. However, these markets are now also being democratised.
"The middle segment or high-net worth individuals are becoming increasingly aware of private market opportunities, thanks to funds like Lighthouse Canton’s, which have brought down tickets for investment in private markets," Tandon said. This shift is enabling mid-tier families to access opportunities previously reserved for institutional players, further diversifying the investment landscape.
Public markets, too, are gaining momentum. The rise of government-backed IPOs and improved market infrastructure is paving the way for broader investor participation in this space.
The combined value of stocks listed in the UAE recently crossed the $1 trillion market capitalisation mark, marking a shift away from its traditional reliance on real estate.
As Tandon put it, "This region had conventionally been very heavy on real estate investing, but that’s changing. Clients are now very open to making non-real estate investments, particularly in technology."
Also read: Beyond the obvious, what is driving the growth of the Middle East as a family office hub
STRATEGIC FOCUS
The UAE’s commitment to becoming a global financial hub is deeply rooted in its strategic focus on healthcare, education, and financial services. These sectors, driven by innovation and equity, are at the core of the country’s long-term vision.
"Healthcare and private hospitals in the UAE are now at par with Silicon Valley," Tandon noted. This is reflected in the significant investments being made to upgrade infrastructure and attract global talent.
According to a 2024 report by Deloitte, the Middle East healthcare market has grown from USD78 billion in 2021 to an expected US$320 billion by 2030.Private healthcare providers are increasingly catering to the growing population of wealthy expatriates and international families relocating to the region.
Education, another pillar of the UAE’s strategy, has seen transformative developments. "The UAE is the first foreign destination for an IIT to set up a full campus. NYU Stern already has an affiliated campus in Abu Dhabi," Tandon explained, highlighting the country’s focus on tertiary education. These advancements are complemented by high-quality primary and secondary education, which has become a default standard in the region. "When I moved to Dubai seven years ago, high-quality primary and secondary education was selectively available. Now, it’s a given," he added.
This focus on healthcare and education aligns with the UAE’s broader ambition to attract a cosmopolitan mix of global families and professionals. "A lot of foreign players are coming and investing in the UAE, particularly in education and healthcare," Tandon observed. This influx is not only uplifting the country’s social infrastructure but also fueling economic growth.
In financial services, the UAE continues to evolve as a global powerhouse. The Dubai International Financial Centre (DIFC) has become a magnet for institutional investors and asset managers. "The UAE’s regulatory landscape is now as stringent as Singapore’s," Tandon said, emphasising the region’s global competitiveness.
This progress is reflected in the UAE’s burgeoning equity markets, as highlighted above.
The combined focus on healthcare, education, and financial services is transforming the UAE into a dynamic ecosystem for global investors and families. By fostering innovation and equity across these sectors, the UAE is not just adapting to global trends—it is setting them.
Also read: Outlook 2025: A brave new world in the wealth management industry
