New citizens will enrich the UAE's heritage and evolving culture. EPA
New citizens will enrich the UAE's heritage and evolving culture. EPA
New citizens will enrich the UAE's heritage and evolving culture. EPA
New citizens will enrich the UAE's heritage and evolving culture. EPA

With citizenship, world's talent can call the UAE home


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On Saturday, Sheikh Mohammed bin Rashid, Prime Minister and Ruler of Dubai, detailed a new, formal process through which the country's foreign residents can obtain Emirati citizenship. The announcement means that the world's most talented people have the chance of a permanent home in the UAE, and an opportunity to integrate fully into the national identity.

Internationally recognised scientists and inventors, as well as doctors – especially those in high-demand sectors – can be nominated by the country's officials and rulers. Artists, creatives and intellectuals of sufficient renown are also eligible – a recognition of the fact that the vitality of a society extends beyond just its technical expertise. The directive of President Sheikh Khalifa, which has become law through amendments of the executive regulation of the law on nationality and passports, means a new chapter for expatriates has begun in the UAE.

This new avenue to citizenship will come with responsibilities and can be withdrawn if the recipient breaks Emirati law. But it is the latest iteration of a drive to render the UAE a global centre of excellence. In 2019, the Golden Visa scheme gave talented people in specific sectors the chance to obtain a 10-year, renewable residency permit, which also extends to their families. Last year, the programme expanded to include people from a greater number of fields, including exceptional students.

The most ambitious global citizens are increasingly open to the prospect of working abroad. The UAE is among a group of nations that aspire to attract this spirit. Other countries with talent visa schemes include the US, UK and Singapore.

No matter how globalised our world is becoming, we intrinsically seek a place to call home

The new policy also introduces dual nationality. Recipients of UAE citizenship can keep their original citizenship.

Nowadays this trend is shifting, as changes to residency laws increasingly offer talented people the chance to remain for longer. Granting citizenship to certain foreigners is the strongest gesture yet that the UAE can be a permanent base for them to realise their potential. For decades, people from diverse backgrounds have contributed to the rapid development of the country. Workers from all over the world continue to do so, attracted by ambitious projects, favourable employment conditions and a safe and tolerant society. Many, however, have had limited opportunity to stay for the long haul.

Minister of State Zaki Nusseibeh linked the creation of the new laws to the UAE's culture of tolerance. Granting citizenship is significant beyond the permanent right to work. It gives the recipient a more fundamental connection to the country. No matter how globalised our world is becoming, we intrinsically seek a place to call home. With an Emirati passport, leading experts in the nation will now be able to do so.

The UAE has set itself hugely ambitious developmental targets, aiming by 2071 to be one of most advanced nations in the world. While talent knows no borders, gathering world-leading expertise in one place catalyses innovation.

This will not only benefit those with an interest in pushing the boundaries of science, medicine, culture and innovation. It will weave new threads into the fabric of the UAE's evolving heritage, further enrich this nation's identity and help to secure its future.

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A cheaper choice

Vanuatu: $130,000

Why on earth pick Vanuatu? Easy. The South Pacific country has no income tax, wealth tax, capital gains or inheritance tax. And in 2015, when it was hit by Cyclone Pam, it signed an agreement with the EU that gave it some serious passport power.

Cost: A minimum investment of $130,000 for a family of up to four, plus $25,000 in fees.

Criteria: Applicants must have a minimum net worth of $250,000. The process take six to eight weeks, after which the investor must travel to Vanuatu or Hong Kong to take the oath of allegiance. Citizenship and passport are normally provided on the same day.

Benefits:  No tax, no restrictions on dual citizenship, no requirement to visit or reside to retain a passport. Visa-free access to 129 countries.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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