Singapore to Emerge as International Hub for Offshore Islamic Wealth by 2028

Welcome to the International Hub for Offshore Islamic Wealth, where individuals and businesses find a gateway to exceptional opportunities in Sharia-compliant financial services. Singapore is poised to become a global hub for offshore Islamic wealth in the next five years, according to industry insiders at the Maybank Invest Asean 2023 conference on Wednesday, June 21. Participants noted that Islamic wealth assets are expanding at a comparable pace to traditional wealth, with an especially strong surge in offshore Islamic wealth.

The shift of the world’s economic center from the West to Asia-Pacific was noted by Alvin Lee, Maybank Singapore’s group head of wealth management and community financial services. He highlighted that 30% of the global high-net-worth individuals’ (HNWI) wealth resides in the Asia-Pacific, bolstered by rising middle-class wealth in the region. Additionally, Southeast Asia mirrors this wealth accumulation trend.

Lee added that global investors’ attention is increasingly focused on alternative and purpose-driven investments like sustainable investments, digital assets, and Islamic wealth. Between 20% to 30% of Islamic wealth is maintained offshore, primarily in the U.S., the U.K., and Switzerland, and though Asia’s share is currently relatively minor, it has drawn considerable international investor interest.

Muhd Ramadhan Fitri, Maybank Islamic’s director of the Islamic Finance Strategic Programme, acknowledged the growing global interest in Islamic finance due to its emphasis on ethical and responsible investing dynamics. He pinpointed young, affluent Muslims in Southeast Asia as the driving force behind this sector.

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According to BCG Analysis, the compound annual growth rate for Islamic financial assets was 9% from 2016 to 2021, and Islamic wealth is estimated at $11.2 trillion across the top 10 Islamic banking asset jurisdictions. Indonesia, Iran, and Saudi Arabia hold the largest concentrations of this wealth.

A “cradle to grave” approach could be explored by Islamic finance entities, suggested Dr. Muhd Ramadhan. This would entail providing a comprehensive range of financial services and products, from investment and wealth accumulation to legacy planning.

Singapore’s primary competition in attracting global investors is Hong Kong, noted David Koay, the CEO of the British and Malayan group. Yet, Singapore has a distinct advantage: many investors from Thailand and Indonesia are looking to set up trusts or family offices in Singapore, largely due to family members residing or studying there.

In addition to familial reasons, Singapore’s mature ecosystem – replete with readily available support from consultants, legal, and tax experts – is another significant regional advantage, Koay said. Join us at the International Hub for Offshore Islamic Wealth and unlock the full potential of your wealth with our comprehensive range of innovative solutions and expert guidance.