The United Arab Emirates is known to expats who’ve lived there for many things: its tall skyscrapers, lack of outdoor pavements and sidewalks, virtually non-existent taxes, the world’s largest (some say second-largest) shopping mall, complete with indoor ice rink; and, of course, average daily temperatures during the summer months of more than 30° C.
What is perhaps less well known, at least until now, is that quite a lot of expatriates who live there at the moment – or 65%, almost two out of three – would like to make the hot, almost-rain-free Gulf country “their permanent home”.
This at least was one of the key findings of recent research carried out by Friends Provident International, the Isle of Man-based provider of savings, investment and protection products for, among others, expatriates who happen to live in the UAE.
The research was carried out last November, and was aimed at learning more about the attitudes of expats living in the UAE with respect to their savings and investments, personal goals and lifestyles.
The 565 expat survey respondents came from a cross-section of countries, including the UK as well as India, the UK, South Africa, the Philippines and Australia, according to a summary of the findings.
Perhaps not surprisingly, given the UAE’s reputation as a global centre for commerce, 44% of those surveyed said “earnings potential” was what brought them to reside in the UAE, and a third, or 33%, gave “saving for a business” as a personal financial priority.
Nevertheless, to anyone who has tended to think of expat postings in the UAE as being mainly for short periods, the fact that 58% of survey respondents said they wanted their children to attend university there – rather than in their home country, including the UK or the US – might have been something of a surprise.
Similarly, the idea of potentially retiring in a country that locals routinely leave during the hottest months of the summer, in order to avoid the heat, might seem counter-intuitive to some.
But as FPI chief marketing officer for the Middle East and Africa Philip Cernik points out, stereotypical ideas about the country and its attractions may not fully take into account its livability and charms.
“This insight helps us to better understand the protection, savings and investment habits of expats in the Emirates,” he added.
Cernik admitted, though, that he and his colleagues at FPI “were interested to discover that over half of respondents wish to remain in the country permanently”, however unsurprising the fact that many said they enjoyed their lives there may have been.
“This is a testament to the lifestyle and hospitality of the UAE, and highlights the importance placed on the financial potential that comes with living here.”
Particularly for those who wish to remain, Cernik went on, the importance of maximising the financial rewards of living in the UAE, and investing them wisely, becomes crucial, since “remaining in the country long term – or post-retirement – can be complicated”.
“While a significant number of respondents cite earnings potential as a key reason for wishing to reside in the UAE, 56% claim their biggest concern is ensuring they have enough to live on,” he said.
“Taken together, these findings suggest a gap between the dreams and financial reality for most respondents.
“For example, concern about debt (21%) is greater than saving for retirement (15%).
“There is an interesting disparity here that suggests people are not saving as much as they would like, or indeed need to.”
The research also found that only a third of respondents have any form of policy with an international life company, which would be more likely to continue to cover them if they return to their home country than a policy from a local company – despite the majority understanding the importance of global coverage for their family.
Additionally, only 13% of those expats surveyed said they possess temporary cover, and a further 13% only said they have whole-of-life cover.
The findings form part of FPI’s Expat study on protection, savings and investments, conducted in partnership with market intelligence firm, Insight Discovery.
As reported, UK insurance giant Aviva agreed last July to sell FPI to RL360°’s parent, International Financial Group Ltd, for £340m (US$444m). Aviva acquired FPI when it bought Friends Life two years before that, but like many larger insurance companies, has been seeking recently to concentrate in areas in which it is strongest, and divest those businesses which aren’t core to its business plan. FPI specialises in looking after clients in the Middle East and Asia.The indoor ice rink in the famous Dubai Mall, located near the Burj Khalifa in downtown Dubai.