More than 200 decision-makers, HNWIs, wealth managers, private bankers listen to 30+ specialists on how the future of the global wealth market will evolve and how they could prepare themselves for it
Investors in the Arab World and beyond need to remain cautious and watch the escalation of the US-China trade war and how a ‘no-deal’ could affect the global economy, along with the US Federal Reserve’s possible interest rate hike, speakers cautioned more than 200 decision-makers, investment advisors, wealth managers, business-owners and private bankers at the Wealth Arabia Summit held at the JW Marriott Marquis hotel in Dubai on Thursday, November 29, 2018.
World leaders are meeting at the G20 Summit in Argentina that starts tomorrow, Friday, November 30 and continues till December 1, 2018
“The impact of the outcome of the trade negotiations between the United States and China at the G20 Summit this week and the US Federal Reserve’s decision to hike the interest rates will have a major impact on global investor community and the equity markets worldwide and investors will factor these in their decisions,” Kay Van-Petersen, Global Macro-Strategist at the Singapore-based Saxo Bank, told delegates at the Wealth Arabia Summit.
“United States and China represent nearly 40 percent of the US$87.5 trillion global economy. The US economy is on fire – it grew 4.2 percent in the second quarter. The annualised growth of the US and Chinese economy adds roughly US$1.7 trillion to the global economy – larger than the economy of Australia.”
After its meeting on November 8, 2018, the Federal Reserve announced that it would maintain the target range for its benchmark interest rate of 2.00% ‑ 2.25 percent. In September, the Fed raised interest rates by 25 basis points to current levels, the highest recorded since April 2008.
“The US equity has outperformed, including the tech equities and we have seen the Apple’s market capitalisation hit a record US$1 trillion this year,” Van Petersen said.
“We need to find out where do we reprice – in all asset classes – to benefit from the volatility. Most investors are pricing on the possible US Fed rate hike.”
He said, the Global Financial Crisis of 2008-09 left the global economy with $170 trillion worth of debts that has now ballooned to nearly US$250 trillion.
“The big question is – are we going to see another fiscal stimulus? The market projects at least four Fed rate hikes from December 2018 till the end of 2019,” Van Petersen said.
“The quantitative easing (QE) and stimulus packages have inflated the value of assets – across all asset classes. The market is stressed. This is big correction.”
He said, the next recession will be ‘drawn out’.
Global wealth increased by US$14 trillion last year – with China ranking second after the USA, according to Credit Suisse.
“Our latest findings show that the world was wealthier in the past than our previous analysis indicated. New official statistical data and other reliable sources have led us to revise our estimate. The revision mostly relates to non-financial assets owned by the middle class,” Credit Suisse report said.
“China is now clearly established in second place in the world’s wealth hierarchy. Another prominent feature of the world wealth outlook this year is the seemingly relentless rise in household wealth in the United States. Total wealth and wealth per adult in the United States have grown every year since 2008, even when total global wealth suffered a reversal in 2014 and 2015.
During the twelve months to mid-2018, aggregate global wealth rose by US$14.0 trillion to US$317 trillion, representing a growth rate of 4.6 percent. This was also sufficient to outpace population growth, so that wealth per adult grew by 3.2%, raising global mean wealth to US$63,100 per adult, a record high.
The Wealth Arabia Summit is the only platform in the region built from the ground up that specifically caters to high net-worth individuals (HNWIs) and their most trusted representatives in wealth management.
Since its inception in 2016, the summit has established itself as the premium forum bringing together the region’s HNWIs, senior investment executives and service providers for actionable investment advice from the world’s most informed.
Following the continued success of 2016 and 2017, the 2018 edition of the Wealth Arabia Summit has evolved significantly with the introduction of three new forums and a larger exhibition space. The 2018 edition includes the Main Stage which features six keynote presentations on vital trends shaping the investment space, followed by the Women’s Investment Forum, the Real Estate Investment Forum and the Family Affairs Streams, as well as exhibition space for service providers.
Among the speakers, Mustafa Kheriba, Chief Operating Officer at Abu Dhabi Financial Group; Kay Van-Petersen, Global Macro Strategist at Saxo Bank; Alexander Bello, Managing Partner of CS Global Partners; Cedric Lizin, Head of MENA at UBS Wealth Management; George Campanellas, Director General, Invest Cyprus (CIPA); Ambar Amleh, Founder & COO at Ibtikar Fund; Milos Stojanovic, Vice President of Arton Capital; Murray Strang, Head of Dubai – Management at Cluttons, will deliver key messages to the audiences through speech and panel discussions.