ADGM (Abu Dhabi Global Market), the International Financial Centre in the UAE’s capital, has showcased impressive growth during the first half of 2023, solidifying Abu Dhabi’s position as a ‘falcon economy’ and a predominant financial powerhouse in the GCC region.
The number of investment firms and hedge funds setting up within ADGM has seen a significant uptick. There are currently 102 asset managers operating in ADGM, managing 128 funds, asserting Abu Dhabi’s leadership in the asset management sector. Moreover, the Assets Under Management (AUM) of ADGM has reported a year-on-year growth of 35% as of June 2023.
A key update this year was the enhancement of the Financial Services Regulatory Authority’s (FSRA) framework. The move enables ADGM-based collective investment funds to invest in credit facilities, highlighting the intention to provide alternative financing, especially for the Small and Medium-sized Enterprise (SME) sector. This development was underscored by the introduction of the Private Credit Fund framework.
Renowned global firms such as Goldman Sachs, Brevan Howard, and Apollo, among others, have chosen ADGM as their location in 2023, a testament to ADGM’s appeal as a holistic financial hub. Additionally, the IFC saw the legendary investor Ray Dalio select Abu Dhabi as the strategic hub for his family office’s expansion.
Alan Howard, Founder of Brevan Howard, commented on the move to ADGM:
Abu Dhabi and ADGM offer a transparent and business-friendly environment to the banking, fintech, and investment management industries.
Similarly, Rajeev Misra, CEO of OneIM, emphasized Abu Dhabi’s emerging role as a global hub for investors.
The first half of 2023 also saw ADGM’s FSRA roll out its sustainable finance regulatory framework, introducing the region’s most comprehensive ESG disclosure requirements. Notably, the Asian Infrastructure Investment Bank (AIIB) also signed an agreement to establish its first Interim Operational Hub at ADGM, with sustainability at its core.
A significant landmark in ADGM’s trajectory in 2023 was the announcement of its expansion to include Al Reem Island, making it one of the largest financial districts globally. This expansion mirrors the growth trajectory with operational entities in ADGM reporting a 36% year-on-year increase.
The efficiency in issuing commercial licenses has also been noteworthy. From June 2022 to June 2023, there’s been a 50% improvement in this sector.
In response to these developments, H.E. Ahmed Jasim Al Zaabi, Member of Abu Dhabi’s Executive Council & Chairman of ADDED and ADGM, said:
We are excited to see the growth numbers of ADGM at the end of the first half of 2023. Our outlook remains strong for 2023.
With such milestones, ADGM’s positive performance in 2023 aligns with its Growth Strategy for 2023-2027, reiterating Abu Dhabi’s ambition to spearhead economic diversification via the growing financial sector.