Philippe Amarante is a Managing Partner at Henley & Partners and the Head of the firm’s Dubai and Pakistan offices.
Centi-millionaires are a unique cohort of individuals with a net worth exceeding USD 100 million in investable assets, with only 28,420 in the world able to claim this title. Their financial prowess and influence make them a sought-after group by governments worldwide for good reason — by finding ways of beckoning this elite wealth band to their shores, governments are turbocharging economic transformation in their countries. Attracting and retaining centi-millionaires can significantly boost a country's economic growth, innovation, and investment landscape. This essay delves into the strategies employed by governments to attract and retain this affluent group, with a particular focus on Abu Dhabi and Saudi Arabia.
Lessons can be drawn from Monaco, a small city-state nestled on the French Riviera, which stands as a testament to the profound impact of drawing in and keeping the ultra-wealthy and converting this rather small nation into an economic powerhouse, with one of the highest GDP per capita globally.
Another excellent example is Singapore. In March 2019, the Monetary Authority of Singapore and the Economic Development Board collaboratively set up a team dedicated to the attraction of single family offices (SFOs), aiming to bolster Singapore's position as a leading global center for wealth management and family office operations. A few years later, this dedicated strategy had led to the incorporation of more than 1,000 SFOs alone in 2022.
As per the economic model, demand drives value. With its immigration component a key consideration for SFOs and centi-millionaire attraction, the Singapore Global Investor Program (GIP) underwent new eligibility criteria in March 2023, now requiring Singapore-based SFOs to manage assets worth a minimum of SGD 200 million. Out of this, at least SGD 50 million should be brought into Singapore and invested specifically in approved exchange-listed companies, qualifying debt securities, funds overseen by licensed Singaporean managers, or equity contributions to unlisted Singaporean businesses. To further deploy more capital into the economy and create direct benefit for the local financial system, the permanent residence permit (re-entry permit issued for an initial period of five years) can only be renewed if the successful applicant has employed at least 10 individuals, five of which must be additional family office experts and at least three must be Singaporean citizens.
These revised stipulations underscore the potential value addition that SFOs and centi-millionaires can bring into an economy, thereby emphasizing the imperative for GIP investors to augment their investments in the domestic financial landscape and concurrently foster the creation of high-caliber employment opportunities for the local population.
Abu Dhabi, the capital of the UAE, has strategically positioned itself as a magnet for centi-millionaires and SFOs. Distinctively, the emirate's approach, perhaps contrasted with its neighbor Dubai, is meticulously tailored to lure centi-millionaires and highlight the city’s ambition to become a premier global hub for the world's financial elite.
The recent establishment of a family office branch in the Abu Dhabi Global Market by Ray Dalio, the Founder of Bridgewater Associates, exemplifies the rising attraction of Abu Dhabi to the global financial aristocracy. This move not only signifies the emirate's growing prominence but also attests to its robust financial infrastructure and strategic vision.
However, Abu Dhabi's offering extends beyond mere fiscal incentives. The efficient issuance of long-term visas, coupled with a compelling value proposition, emphasizes safety and protection without compromising the dynamic agility of its ecosystem. This unique blend fosters an environment conducive to pioneering economic initiatives and maps a trend we see around the world. If a government wants to attract private capital, it must develop and deploy a unique value proposition relevant to specific audiences.
The emirate wisely recognizes the multifaceted contributions of centi-millionaires beyond their substantial financial capital, understanding that these individuals bring with them innovative ideas, robust business strategies, and an intrinsic drive to create and expand. This, in turn, attracts a cadre of professionals and implementers, further enriching the local ecosystem. Conversely, Abu Dhabi’s proactive and adaptive governance fosters a sense of partnership, positioning centi-millionaires not merely as investors (just numbers) but also as collaborative stakeholders in a shared vision of prosperity and growth.
The Kingdom of Saudi Arabia's Vision 2030 is a transformative blueprint aimed at diversifying the nation's economy beyond oil and fostering a vibrant society, a thriving economy, and an ambitious nation. Spearheaded by Crown Prince Mohammed bin Salman, this vision seeks to reduce Saudi Arabia's dependence on oil, develop public service sectors, and promote tourism, entertainment, and investment.
The Public Investment Fund serves as the big engine and is investing globally across a myriad sectors and acts as a magnet to catalyse attractive domestic projects of unseen size and complexity. While certain regulatory framework enhancements are still under review, the kingdom has already launched dedicated streams to attract wealthy clients via its Premium Residence options. Equally important, it has also laid the pathway to citizenship for the brightest minds, which may change our collective tomorrow. This attraction of intellectual capital paired with enormous motivation for change and large funding creates comfort and opportunities for discerning centi-millionaires looking to engage in exciting ideas with first mover advantages.
Because attraction methods will always need to have some level of established awareness, Saudi Arabia is leveraging the introduction of tourist visas and focusing on luxury tourism as a showroom to the world. Albeit under development, the Red Sea Project and Amaala are luxury tourism initiatives aimed at ushering in the world's elite and receiving relevant media attention.
While attracting centi-millionaires is a challenge in itself and (thanks to competition and more options) not one that is getting easier, retaining them is another ball game. Both Abu Dhabi and Saudi Arabia have realized the importance of creating a conducive environment for these individuals to thrive in, and provide the ingredients that can formulate sustainable and long-term belonging between the state and the centi-millionaire group.
For any retention strategy targeting the high-end wealth demographic, certain elements are paramount. Foremost among these is the lifestyle on offer. Luxury shopping, exquisite dining options, and rich cultural experiences play an indispensable role in retaining this affluent class of individuals. Equally vital is a business-friendly environment. By ensuring streamlined business regulations, ease of doing business, and a robust legal framework, nations can create an atmosphere wherein centi-millionaires both desire to reside and are encouraged to invest, establish ventures, and build permanent homes.
And becoming more and more important, philanthropic opportunities hold significant weight. Many ultra-wealthy individuals possess a strong inclination towards philanthropy and giving back to society. By cultivating a vibrant philanthropic ecosystem, governments can provide these individuals with meaningful avenues to contribute to societal advancement.
The race to attract and retain centi-millionaires is intensifying around the world. While countries like Singapore have set the benchmark, the UAE and Saudi Arabia are not far behind. Their strategic initiatives, coupled with their unique cultural and economic propositions, make them formidable contenders in this race.
To truly captivate centi-millionaires, mere financial incentives and compelling investment opportunities are insufficient. In my view, governments need to adopt a two-pronged approach. The former strategies must be paired with comprehensive retention tactics. Creating an all-encompassing environment that addresses the business, lifestyle, immigration concerns, and even philanthropic aspirations of these super-wealthy individuals is pivotal.
In the ever-evolving global landscape, it's not just about attracting wealth but also about fostering a symbiotic relationship where both the country and the centi-millionaire cohort mutually benefit and strive for a better tomorrow.