December 29, 2025
By Richard Rousseau
Throughout history, cities have attracted investors, artists, entrepreneurs, and wealthy individuals from beyond their native countries and regions. The Hanseatic cities of the 13th and 14th centuries, for example, were at the heart of the revival of trade at the end of the Middle Ages. They were also places where more freedom reigned. Genoa and Bruges took up the mantle from the 15th century onward. Starting in the 17th century, Geneva and Switzerland became popular destinations because of their freedom and security.
Beirut, in the Middle East, acquired the status of a financial center and a meeting point of cultures in the 1960s and ’70s. Starting in the 1980s, Singapore also played a key role as an economic and financial magnet in Asia. In recent years, Dubai and the United Arab Emirates have emerged as preferred destinations for investing and securing capital.
New global financial hub
In less than fifty years, Dubai has transformed from a regional trading port into one of the world’s most dynamic financial centers. It is now the leading financial center in the Middle East, surpassing Bahrain and Riyadh. This financial shift began in the 1990s and was solidified by the establishment of the Dubai International Financial Centre (DIFC) in 2004. The DIFC is an offshore financial zone that operates under Anglo-Saxon law and is independent of the local legal system.
Dubai enjoys a stable political system and maintains excellent relations with the United States, Europe, China, and Russia. It is renowned for its high level of internal security and low crime rate. Its tax regime is competitive, offering no income tax, a moderate corporate tax rate of 9%, and total exemption within the DIFC zone. Thanks to these advantages, Dubai attracts wealthy individuals from the Gulf, India, Pakistan, and Africa, as well as Russian and Chinese families and, increasingly, European families. Privacy, the legal stability of the DIFC, and low corporate taxes further fuel this growth.
According to the British immigration consultancy Henley & Partners, the UAE has been top destination for high-net-worth individuals in 2025, with an anticipated 9,800 arrivals representing $63 billion in assets. This surpasses the United States (7,500 arrivals totaling $43.7 billion) and Switzerland (3,000 arrivals totaling $16.8 billion), putting the UAE far ahead of Singapore and Hong Kong. Over 130,500 millionaires have already settled in the UAE, including 81,000 in Dubai. Among them are 28 billionaires, which is a 98% increase from ten years ago.
For instance, Dubai is expected to surpass Paris, which has 160,100 millionaires and 22 billionaires. Wealthy families favor Dubai because they can easily establish themselves there. The city’s regulations are more flexible than those in Geneva, Singapore, or Hong Kong. Furthermore, Dubai offers all the amenities affluent individuals expect, including high-end services, a high-performing healthcare system, leisure activities, shopping malls, and luxury boutiques. The international airport provides access to capital cities worldwide, notably via Emirates, one of the world’s leading airlines.
dubai people cityThe Challenge of Islamic Finance
Dubai is competing with Kuala Lumpur to become the world capital of Islamic finance. The authorities also intend to establish the city as a hub for fintech companies to develop the crypto-asset market. Many cryptocurrency companies are leaving Hong Kong or London to establish a presence there. Within the DIFC, more than 8,000 financial institutions are present, employing 48,000 people. Twenty-seven of the world’s 29 most important banks have offices there, including five of the largest Chinese banks. JP Morgan, Goldman Sachs, HSBC, BlackRock, and others have also chosen Dubai.
Over the past ten years, the size of banking assets has grown 200% to reach $240 billion. The DIFC has also become a major insurance hub for Africa, the Middle East, and South Asia. However, Dubai is not without its weaknesses. Its rapid, speculative growth leaves it vulnerable to price changes and corrections in the financial or real estate sectors. The financial market is not very diversified, with few local companies listed. Reputational risk persists due to money laundering and opaque capital flows. After putting the UAE under close watch for a period of time, the Financial Action Task Force (FATF), an intergovernmental organization established in 1989 at the behest of the G7 to formulate policies aimed at combating money laundering and safeguarding specific interests, decided to include it on its gray list for the years 2022–2025.
Although this designation has since been lifted, the threat remains. The UAE Ministry of the Interior has stated that it has handled 521 money laundering cases in recent years in collaboration with international organizations. Over one billion dollars has been seized. In 2023, Dubai implemented a low corporation tax and a 5% Value Added Tax (VAT) to set itself apart from offshore havens. Being named a tax haven is no longer mainly advantageous for the wealthy.
Dubai does not seek to supplant New York or London; rather, it is positioning itself as a premier worldwide financial hub, comparable to Singapore. Dubai is currently ranked 11th among financial cities, whereas Paris has the 18th position, Shanghai is 8th, and San Francisco is 5th.
Dubai’s rise is based on a strategy combining political stability, legal innovation, and international openness. While the Gulf city remains exposed to certain structural risks, it continues to attract talent and capital at an unprecedented rate. It is now establishing itself as an essential link in the financial geography of the 21st century.
Richard Rousseau, Ph.D., is an international relations expert. He was formerly a professor and head of political science departments at universities in Canada, Georgia, Kazakhstan, Azerbaijan, and the United Arab Emirates. His research interests include the former Soviet Union, international security, international political economy, and globalization. Dr. Rousseau's approximately 800 books, book chapters, academic journal and scholarly articles, conference papers, and newspaper analyses on a variety of international affairs issues have been published in numerous publications, including The Jamestown Foundation (Washington, D.C.), Global Brief, World Affairs in the 21st Century (Canada), Foreign Policy In Focus (Washington, D.C.), Open Democracy (UK), Harvard International Review, Diplomatic Courier (Washington, C.D.), Foreign Policy Journal (U.S.), Europe's World (Brussels), Political Reflection Magazine (London), Center for Security Studies (CSS, Zurich), Eurasia Review, Global Asia (South Korea), The Washington Review of Turkish and Eurasian Affairs, Journal of Turkish Weekly (Ankara), The Georgian Times (Tbilisi), among others.
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