Dubai International Financial Centre (DIFC), the leading financial hub in the $7.4 trillion Middle East, Africa and South Asia (MEASA) region has celebrated a ‘year of firsts’ as it today reported a strong performance for 2016.
DIFC reached 1,648 active registered entities compared to 1,445 this time last year, representing a net increase of 14%.
This included 447 financial services firms , up 10% from the 408 recorded in December 2015.
In addition, 976 non-financial services firms registered in the DIFC, up 17% from the 835 non-financial firms last year, as well as 211 retailers, up 12% from the 189 retailers last year. Combined, this means that DIFC now totals a workforce of 21,611 professionals, a 9% increase from 2015, putting DIFC firmly on its path to execute the 2024 strategy.
This will see the Centre triple in size by deepening core client synergies, building relevance in key global sectors, and facilitating trade and investment across the South-South trade corridor. These initiatives will be supported by the continued enhancement of the Centre’s physical and regulatory infrastructure.
Commenting on these achievements, His Highness Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, Deputy Ruler of Dubai and President of DIFC, said: “DIFC has played an integral role in shaping the financial services landscape, not just in the UAE but in the broader Middle East, Africa and South Asia region, a market that is worth US$ 7.4 trillion. The Centre has excelled in providing a stable yet innovative platform for financial firms to access high-growth emerging markets in this region, positioning Dubai as a leading global financial hub.”
His Highness also said that DIFC continues to implement ambitious plans to keep pace with the growing economic development of the UAE, and to support the overall development of the emirate of Dubai in close cooperation with its partners.
He further said that DIFC’s achievements in 2016 have made it a clear leader in the region’s financial sector.
International companies have placed their confidence in DIFC, which has been vindicated by their increased growth. DIFC has steadily expanded its infrastructure to accommodate the growing demand from its partners, His Highness added.
Adding to this, His Excellency Essa Kazim, Governor of DIFC and Chairman of DIFC Authority Board of Directors, said: “The year 2016 was marked by significant global shifts, which brought challenges but also opportunities. Our strong financial results show that DIFC is resilient, while at the same time a number of ‘firsts’ achieved in the Centre bear testimony to the fact that we are agile, forward-thinking and innovative. We continue to demonstrate how our offering goes beyond being the region’s leading financial centre, by investing in leading concepts and developments to become a world-class business and lifestyle destination.
“As we move forward in 2017, we will continue to embrace the opportunities, particularly in terms of new technologies and the emerging markets of MEASA. We will focus on promoting innovation and use the next generation of technologies to further enhance our offering to clients, while providing access to international markets within a robust and secure regulatory and legal framework.”
A Year of Firsts
One of the main highlights for DIFC last year was the transfer of the HSBC Bank Middle East Limited (‘HBME’) head office from Jersey to the DIFC, meaning HBME is now lead-regulated by the Dubai Financial Services Authority (DFSA).
The move has reinforced the attractiveness and competitiveness of the UAE economy to international players in the banking and financial services sector, further strengthening the credibility of the DIFC’s regulatory regime.
As part of DIFC’s commitment to adopting innovation and harnessing information technology to enhance productivity and efficiency for its clients and position itself as an advanced technological hub, the Centre achieved yet another regional first as DIFC became home to the first, innovative Equity Crowdfunding platform.
Last year, Eureeca.com began DFSA regulated activity linking high growth businesses with much needed and underserved capital.
Pioneering a regional legal first, in 2016, DIFC announced the opening of the first specialist barristers’ chambers, demonstrating confidence on an international level in the Centre’s legal structures.
Outer Temple Chambers (OTC), from London, UK, is a leading set of expert, global barristers (lawyers who practice in international and English common law courts and arbitral tribunals).
Their services will benefit the entire regional business community, regardless of whether or not businesses are registered in DIFC, as long as they use the DIFC Courts.
DIFC also became one of the founding members of the Global Blockchain Council, a board formed in line with the efforts of Dubai Museum of the Future Foundation to promote innovation and use the next generation of technologies to enhance UAE’s position as a leading centre for innovation and knowledge economy.
The membership reinforced DIFC as a leading financial technology hub, as the Council’s role is to guide on how Blockchain can benefit market participants and provide and implement new and innovative ideas.
In line with DIFC's objective to better serve its clients and support Dubai’s vision of becoming a smart city, the Centre upgraded its unique and highly advanced technological infrastructure, by adding a number of user centric features.
These included its first mobile app, giving DIFC-registered clients access to a wide variety of online services and a Property Listings Website (properties.difc.ae).
Leading the way in environmental initiatives, DIFC also became the first district in the UAE to implement a complete makeover of its lighting infrastructure with the signing of an energy performance contract with Etihad ESCO, guaranteed to achieve annual energy savings of 72% at the Centre by 2022.
Driving Global Impact
DIFC continues to play a key role in the global economy and by maintaining international standards, developing international relations, business and job creation, and economic development, it is a major contributor to Dubai’s reputation as a global business hub.
The Centre, much like Dubai, is home to a truly multicultural community: DIFC’s financial services firms represent a cross section of all major geographies, with 35% originating from the Middle East, 17% from Europe, 16% from the United Kingdom, 11% from Asia, 11% from the United States, and 10% from other countries.
In the last year, high level delegations from DIFC made multiple visits to China, Europe, the UK, India, Africa, the United States of America and countries in the Middle East. Overall, the team participated in 122 events and received 32 international delegations at the centre, driving knowledge sharing and demonstrating thought leadership across the globe.
In China, highlights included participation in events such as the 2016 G20 conferences, sponsorship of Dubai Week in China and a partnership with the Shanghai Stock Exchange (SSE), to host the China Capital Market Forum.
Europe and the UK, other important areas of focus for DIFC, saw the hosting of the UAE-Luxembourg Council Event in Luxembourg and participation from DIFC in the City Week London 2016.
Africa, an important pillar of the South-South strategy, saw participation from DIFC delegations at the 2016 IIF Africa Financial Summit in Johannesburg and the Super Return Africa, in Cape Town.
DIFC delegations also focused on building strong relationships with US and global regulators and banking community through participation in IMF and World Bank Meetings and the UAE Banks reception in Washington D.C, as well as the US-UAE Business Council Event in New York City.
Deepening the core across all financial sectors
DIFC continues to work on improving its international legislative and regulatory framework, and providing an ecosystem and a wealth of expertise across all financial sectors.
In the Asset and Wealth Management space, DIFC welcomed the Bank of Singapore and Pictet as new clients. In addition, the establishment of the Wealth Management Working Group set the foundations for future knowledge and best practice exchange for DIFC clients.
The Centre further broadened its client portfolio in 2016, particularly in the Bank and Capital Markets sector.
DIFC welcomed a number of new firms to set up operations, including the Bank of Palestine, Ahli United Bank Limited (AUBL), a 100% subsidiary of Ahli United Bank B.S.C, which was the first bank in the GCC region to receive the Category 1 license from the DFSA, and Zenith Bank (UK), one of Nigeria’s leading commercial banks.
In addition, the Agricultural Bank of China (ABC Bank) was selected as the very first RMB Clearing Centre for the region.
Furthermore, the insurance sector in the DIFC has grown with key new clients including HDFC Life which is the first Indian insurance firm to join the Centre, and Starr Underwriting Agents. In addition, Jardin Lloyd Thompson expanded its operations to better service HNWIs.
In terms of Corporate and Service Providers, 2016 saw the DIFC welcome new entities, including Exxon Mobil, Mayer Brown LLP and Larsen & Toubro as well as over 20 family businesses which registered their firms in the Centre to structure and manage their wealth.
Beyond a world-class financial centre
DIFC is not only the region’s leading financial hub, but also a world-class business and lifestyle destination.
In April last year, DIFC announced a major addition to its infrastructure with the launch of Gate Avenue at DIFC, a first-of-its-kind urban living development in the region.
With the first phase set for completion by the end of 2017, the much anticipated project will offer over 200 dining, boutique, cultural and entertainment options, as well as an iconic new mosque and will be across 660,000 square feet and span 880m in total length.
Additional enhancements to infrastructure made in 2016, including measures to make the DIFC an energy saving financial centre by 2022, receiving the ISO/IEC 27001 accreditation for information security, and being awarded the Management & Operations Stamp from Uptime Institute for DIFC’s Data Centre, are the foundations that will make the Centre fit for the future.
Furthermore, DIFC’s community initiatives were at the forefront of the Centre’s activities in 2016, with over 25 Corporate and Social Responsibility activities taking place. In particular, the high profile, global Bloomberg Square Mile Relay was held for the first time ever in the region at DIFC, selected as the race’s official venue partner.
Guided by its 2024 Strategy, and exceeding projected targets for the year, the Centre is making strong headway into delivering against its goals and demonstrating double-digit growth across all metrics.
To date, DIFC has achieved 63% of its targeted occupied space, 45% of its target financial firms, and 43% of its target workforce – all of which are expected to be bolstered further upon completion of Gate Village 11 and Gate Avenue at DIFC, as part of the district’s broader Master Plan.
Furthermore, the Centre reached 36% of its target combined balance sheet.
Closing 2016 with a strong performance and looking ahead to 2017, DIFC is eager to continuously embrace change and innovate for growth.
Fuelled by FinTech and exciting new infrastructure developments, DIFC will confidently progress towards the delivery of its 2024 strategy.
At the centre of the strategy is DIFC’s unwavering commitment to deliver the very best for its growing community.
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