As Qatar’s national wealth bloomed much later than its Gulf neighbors, there is still a lot of headroom growth potential for the domestic Islamic investment asset industry, Al Rayan Investment Acting CEO Akber Khan shared in his forecast to IFN Investor.
“There is a vast domestic capital pool but work remains for the local asset management industry, conventional and Islamic, to reach its potential.”
The types of fund that Al Rayan Investment considers launching is up for debate. “There are certain niche investment products rapidly developing globally that we have considered launching.
“But for now, the focus should be to ensure local institutional and individual investors get a full basic tool kit to create diversified portfolios, catering to differing risk appetites. All the local players are hard at work, and we all have more to do.”
Looking at the broader perspective, Akber said Qatar’s penetration of professional asset management is low – referencing the measure of professionally-managed assets under management (AuM) to the country’s GDP – when compared to other more developed countries.
“For some financial centres this ratio is above 200%, but the European average is about 60%. Total AuM in Qatar isn’t clear but my guess is the ratio to GDP is less than 10%.”
Akber said Qatar, which became very wealthy only during this century, is playing catch-up with its Gulf neighbours, some of whom have enjoyed excess wealth for more than 60 years. Across the region, asset management has grown more sophisticated over time. Family wealth has been passed on to generation five in some cases.
“Qatar is in its first and second generation of wealth, and as each progressive generation takes over, demand for third-party asset and wealth managers will expand. And with this, the approach will become increasingly global with a far greater focus on digital solutions.”
Noting how local regulatory authorities are already taking steps toward facilitating the overall finance and investment sectors, Akber said progress has been made but the very comprehensive financial sector development plan that is being jointly-executed by multiple government stakeholders indicates significant ambition.
“Positive changes will come but some patience is required. We want to be part of the change implementation.”
