Middle East families set for $1 trillion wealth transfer by 2030
Families in the Middle East, in particular across the GCC, are preparing for a monumental transfer of generational wealth estimated at $1 trillion by 2030.
A report released by the DIFC Innovation Hub, in collaboration with Swiss wealth management firm Julius Baer and financial markets infrastructure leader Euroclear, sheds light on how emerging technologies are reshaping legacy planning and wealth transfer processes, particularly in the Gulf region.
This report, titled 'Navigating the Future of Inheritance,' identifies cutting-edge digital technologies — such as artificial intelligence, smart contracts, distributed ledger technology, and tokenisation — as vital tools that can streamline inheritance processes.
These technologies promise to reduce friction, improve transparency, and enhance security in asset transfers. However, despite the potential benefits, a significant gap remains: only 24 per cent of HNWIs currently have a comprehensive estate plan in place. Moreover, 53 per cent of families surveyed expressed that the complexities of gathering and allocating assets across larger families make the planning process daunting and time-consuming.
The impending wealth transition will take place mostly across the GCC countries, particularly among high net worth individuals (HNWIs) in the UAE. According to McKinsey, nearly $1 trillion is projected to be transferred across generations in the GCC by 2030, leading to an increased awareness among families on the need for intergenerational wealth planning. As many family businesses in the GCC are beginning to transition into second and third generations, ensuring a smooth leadership change has become crucial for business continuity. Therefore, the pressure of establishing a succession plan has become a growing concern, with many HNWIs not having an inheritance plan in place.
Since 2022, the wealth of HNWIs in the UAE has surged by 20 per cent, now totalling around $700 billion. This dramatic increase necessitates a reevaluation of how families manage and transfer their assets, the report said.
'The findings of this report underscore the urgent need for improved inheritance processes,' said Mohammad Alblooshi, CEO of the DIFC Innovation Hub. 'We are at a pivotal moment in the Middle East, where generational wealth transfer is becoming increasingly complicated, driven by diverse asset categories and a growing interest in digital investments. Our collaboration with Julius Baer and Euroclear aims to harness technological advancements to facilitate a smoother inheritance journey and position the region as a leader in wealth transfer best practices.'
Alireza Valizadeh, CEO of Julius Baer (Middle East) Ltd, said: 'The generational wealth transfer momentum in the UAE and the broader Middle East presents unique opportunities. Our firm, rooted in family business principles, is well-positioned to guide clients through this evolving landscape, especially with the rise of digital assets. Technologies like blockchain and tokenisation are pivotal for creating secure and transparent wealth transfer processes. Collaborating with DIFC and Euroclear enhances our ability to contribute to the future of finance.'
Isabelle Delorme, global head of Product Strategy and Innovation at Euroclear, said: 'This initiative aims to explain the evolving inheritance landscape and address its unique regional challenges. Our goal is to empower financial stakeholders and policymakers to embrace innovation and build a future-ready inheritance framework that benefits generations to come.'
The report also highlights the distinct needs of family businesses at various stages, from those operating for just one or two generations to well-established multigenerational enterprises. To support these diverse requirements, the DIFC offers flexible family business structures and solutions, detailed in a series of new guides.
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