Soon after the first Iranian missile and drone attacks on Dubai last week, two Indian entrepreneurs based there attempted to transfer more than US$100,000 each from their local bank accounts to Singapore to hedge against risks.
Initial transfer hurdles
Technological glitches in the wake of the attacks initially blocked those plans, the entrepreneurs told Reuters on condition of anonymity due to the sensitive nature of the matter.
One of them later succeeded in moving the funds to his Singapore account through another bank based in the Emirates.
Industry advisers and lawyers said scores of other wealthy Asians are making similar enquiries or taking steps to relocate Dubai-parked assets to regional financial centres Singapore and Hong Kong.
The moves follow the US-Israel war on Iran, which has clouded the Gulf’s reputation as a safe haven and unsettled investors.
Dubai’s appeal now questioned
While the wealthy usually spread investments across regions and asset types, they select bases based on tax rules, regulations, privacy and ease of operations.
In recent years Dubai has become a favoured wealth hub for Asian entrepreneurs and rich families, especially from China, drawn by favourable policies and a booming property and infrastructure scene.
That trend now faces sharp scrutiny after attacks on Dubai and Abu Dhabi raised doubts about the United Arab Emirates’ long-standing image of stability.
A Singapore-based private wealth lawyer Ryan Lin said six or seven of his 20 Dubai-based clients, each managing an average of US$50 million in assets, contacted him this week.
Three are planning immediate transfers to Singapore, with one client urgently checking how quickly everything can be moved.
Rising enquiries to Singapore firms
Iris Xu, principal at Anderson Global, said 10 to 20 family offices have reached out this week about shifting assets back to Singapore from the Middle East over fears the conflict could drag on.
Family offices manage the full portfolios of ultra-wealthy individuals and families.
Xu noted that while Dubai offered strong tax benefits, those advantages may no longer top the list of priorities.
A Singapore wealth management adviser, speaking anonymously as they were not authorised to speak to media, said they had spoken to 13 UAE-based clients, with more than half seriously considering moves to Singapore.
The adviser added that even if the conflict ends soon, frequent travel back and forth will remain challenging, describing it as a matter of confidence.
Grace Tang, CEO of Phillip Private Equity, said her mostly Asian clients are nervous, with 10 to 20 asking about relocating wealth to Singapore to preserve capital.
Mixed views from wealth managers
Not all advisers see immediate large-scale capital flight.
Dhruba Jyoti Sengupta, CEO of Dubai-based Wrise Private Middle East, said his firm has not witnessed serious discussions about moving funds.
He described clients as sophisticated global investors already diversified internationally yet deeply committed to the UAE’s growth story.
Sengupta said they continue to feel safe and secure despite broader regional geopolitical turmoil.
The UAE central bank governor Khaled Mohamed Balama stated on Thursday that the banking and financial sector remains resilient, strong, stable and well-equipped to handle regional developments.
He confirmed that banks, financial firms and insurers are operating normally without disruption.
Leading Singapore wealth managers Bank of Singapore and DBS Group said clients are closely monitoring the situation and adopting a wait-and-watch approach for now.
Some expansion plans continue
As the UAE works to preserve its safe-haven image, certain businesses are pressing ahead with growth in the Emirates.
Jeremy Lim, co-founder of GrandWay Family Office, is proceeding with plans to open a family office in Abu Dhabi.
He said the plans stand unless the UAE becomes directly involved in the conflict or Iran escalates further.
Lim noted that direct UAE involvement alongside one side in the conflict would be the real deal-breaker for businesses.
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