Demand for UK-regulated financial planners grows among Gulf expats

Demand for financial planners in the Gulf region is set to grow as the area experiences ‘substantial growth’, according to an independent Thinkpiece conducted by Chatham House.

The research, commissioned by the Chartered Insurance Institute (CII), revealed financial markets could grow at a rate to rival European standards’ in 2009 despite the local economy suffering from recession.

With the region’s governments under pressure to generate jobs for local young professionals, the research suggests financial services and related sectors may provide a ‘viable option’ that could in turn fuel growth in other sectors.

‘Even with oil prices a long way below the 2008 peak, driven down by the global crisis, the region is one of the wealthiest in the world. Given this substantial backing, the Gulf Co-operation Council [GCC] bloc may already be classified among the top 10 financial centres in the world,’ said Vanessa Rossi, senior research fellow in international economics at Chatham House.

The GCC comprises the United Arab Emirates (UAE), Saudia Arabia, Qatar, Oman, Kuwait and Bahrain. In 2008, GDP for the six states is believed to have exceeded $1 trillion, with public sector financial wealth in excess of $2 trillion, in addition to undisclosed levels of private wealth.

Keith Robertson, managing director of London-based financial planning firm Armstrong Financial, who has extensive experience of working and travelling in the region, said growing wealth among expatriates would drive demand for regulated planners.

A dearth of regulated financial planners, combined with language and cultural barriers, had created frustration among British expats needing advice, said Robertson.

‘When I have been travelling around, anecdotally I have picked up a lot of dissatisfaction or outright anger where not particularly sophisticated investors have been sold rather expensive and contentious offshore products there,’ he said.

‘The offshore advisers who operate out there are generally not going to be regulated for business in this country. They tend to do all their business out there and even if they live in the UK for a chunk of the year… they don’t bother maintaining their permissions in the UK to perform regulated activities,’ he added.

Robertson said there was a ‘gigantic’ expatriate community in the region and the number of high net worths was steadily increasing.