DUBAI’S RISE TO FINANCIAL DOMINANCE POWERED BY TRUST, TAX AND TIMING

Attributed by: Nicholas Wright, Head of Institutional Sales, Saxo Bank

Dubai’s winning combination of UK-inspired regulation, investor-friendly tax policies, and a strategic time-zone advantage is propelling the city to the forefront of global wealth destinations, attracting a wave of new millionaires from traditional centres like London.

Its evolution from a regional trading outpost to a global financial centre has been one of the defining economic success stories of the past two decades. Once viewed primarily as a gateway to the Gulf, the city is now positioning itself as a trusted bridge between East and West, a place where capital, talent, and innovation converge.

This transformation is intentional, driven by a powerful combination of regulatory trust, tax advantages, and a strategic location. These combined “push-and-pull” forces are attracting a fresh wave of global investment and high-net-worth migration, solidifying Dubai’s role in the world’s financial architecture.

 Building Global Confidence: Regulation that Mirrors London

A critical pillar of Dubai’s ascent has been the credibility of its regulatory ecosystem, anchored by the Dubai Financial Services Authority (DFSA). The DFSA’s adoption of a UK-style, principles-based framework has created a familiar and trusted environment for international investors, particularly those from established markets such as London, Zurich, and Hong Kong.

By aligning with global standards set by IOSCO and Basel, the DFSA has helped ensure that Dubai’s financial regulations meet the expectations of international institutions. Importantly, the city’s common-law legal framework, applied through the DIFC Courts, offers predictability and transparency, qualities that distinguish Dubai from many emerging markets.

Aligning with internationally recognised best practices attracts global firms that value strong governance and reassures private investors that Dubai’s rapid growth is built on solid foundations. In doing so, it turns the city’s financial free zones, particularly DIFC, into a natural extension of the world’s major financial capitals.

Global Tax Shifts and the Migration of Wealth

While regulation provides the foundation of trust, global tax realignments are now accelerating Dubai’s growth. Across Europe and the UK, tightening fiscal regimes and increased scrutiny of offshore structures are prompting many high-net-worth individuals (HNWIs) and family offices to reassess their base of operations.

The UK’s reform of the long-standing Non-Domiciled (“Non-Dom”) tax regime, combined with higher tax rates and stricter reporting obligations, has diminished London’s appeal as a haven for global wealth. Resulting in a clear outflow of capital, the UK is forecast to lose around 16,500 millionaires in 2025, according to Henley & Partners, the largest net outflow recorded by any country in over a decade.

In contrast, Dubai has emerged as one of the world’s leading destinations for mobile wealth. Over the past decade, the number of millionaires residing in the city has doubled. According to The Rise of Dubai study, the emirate is home to 86,000 millionaires, 251 centi-millionaires, and 23 billionaires, as of June 2025.

This shift represents a classic case of push and pull: mature markets are tightening, while dynamic jurisdictions like Dubai combine transparency with competitiveness. The UAE’s own fiscal evolution,  including the introduction of a federal corporate tax aligned with OECD standards, has enhanced credibility while preserving the hallmark advantages of no personal income tax and a stable, predictable business environment.

At the same time, Dubai’s establishment of family wealth centres, along with trust and foundation structures in the DIFC, is attracting international family offices that value both strong global compliance and flexible local regulations. The DIFC now accommodates over 120 family offices and more than 800 family-related entities, together managing an estimated US$1.2 trillion in assets.

 Dubai’s Enduring Wealth Base and Private Banking Strength

Long before it became a magnet for global capital, Dubai was already a regional hub for private banking, buoyed by decades of oil wealth and the emergence of HNW and UHNW individuals across the Gulf. Historically, much of that wealth was parked offshore in jurisdictions such as Switzerland and London.

Today, that wealth is increasingly being repatriated and managed locally, as the DIFC and DFSA frameworks give investors confidence that their capital is governed under international standards. Making this city a magnet for new millionaires, surpassing other global hubs in attracting mobile wealth.

 Population Growth and the Rise of the Mass Affluent

Dubai’s population surged past 4 million residents in 2025, up from around 1.9 million in 2011. This rapid demographic expansion, fueled by a strong influx of capital, added more than 223,000 new residents in just one year, marking the fastest growth rate in the city’s history.

A significant portion of this growth is concentrated within the affluent and mass-affluent segments, creating strong potential for the next generation of digital and hybrid wealth managers. As professionals, entrepreneurs, and global citizens increasingly choose Dubai as their base, the city’s financial ecosystem is expanding beyond traditional private banking into scalable, tech-enabled wealth management platforms.

The Next Chapter: Sustaining Momentum

As Dubai’s profile grows, so too does the need to maintain the balance between openness and oversight. The DFSA has already demonstrated its adaptability, from developing frameworks for digital assets and fintech innovation to integrating ESG principles into its supervisory approach.

Such responsiveness will be vital as global finance enters a new era shaped by digitalisation, sustainability, and shifting investor expectations. If Dubai can continue to combine rigorous regulation with pragmatic innovation, it will not only retain its current momentum but also strengthen its claim as the most trusted financial hub between London and Singapore.