The UAE and wider GCC’s pension landscape is, ultimately, a nascent one. Its youthfulness gives it room for improvement, but it shows a great deal of promise. In a period of low oil prices and slower fiscal growth in the region, the subject of pension reform should be brought to the forefront of the economic agenda. From an asset management perspective, pension reform will have an important impact on the regional investment landscape, bringing with it developments that will positively affect the opportunities available to fund managers and investors alike.

The UAE faces interesting challenges, with the government working hard to meet these by taking steps to implement a new and improved strategy for economic reform. While the UAE is a young country with a relatively youthful population, the median age is heading towards the 40s and the working demographic is predominantly expatriate. Major global corporates that have entered the private sector are largely managed and staffed by expatriates, and so it is of growing importance that multinationals pay into a pension fund structure that supports the economy in which they operate. A more comprehensive and sophisticated pension infrastructure will therefore be vital for ensuring the stability and sustainability of the country’s economy.

Meanwhile, the disparity that exists between public- and private-sector pension contributions needs to be closed. This may have a part in encouraging greater levels of Emiratisation in the private sector, which will have the longer-term effect of safeguarding the UAE economy through better integration of Emiratis in the corporate world.

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