Interview: Ahmed Al Sayegh
How does ADGM aim to position itself among other financial centres in the region?
AHMED AL SAYEGH: Many institutions, local and international, recognise that the Middle East and Africa is an important and fast-growing region. Abu Dhabi is a natural hub and gateway to the region. Local stakeholders from the UAE or the wider Middle East are key users of financial services. However, most of these financial services have had to be conducted outside the region. There is now a desire among asset managers and risk allocators to move these services closer to home so they can take a more holistic view of the risks of their operations. With ADGM and its suite of financial vehicles and market infrastructure, market participants are able to anchor more activities in Abu Dhabi instead of abroad.
ADGM was established to support the financial stability of Abu Dhabi and the UAE and complement the vibrant economic growth here. It is ADGM’s role as an international financial centre to identify and cater to the current and future needs of the markets in our region, which goes beyond rules and regulations. Since going fully operational with our three authorities, we have established a number of new initiatives to address the unfulfilled needs of stakeholders for regulated products and business solutions.
To date we have registered more than 320 diverse non-financial and financial companies, more than 70 special purpose vehicles, five domiciled funds and three foreign funds, making ADGM the fastest-paced fund creation centre in the region.
On the legal front, ADGM is the first jurisdiction in the region to adopt common law in its entirety, similar to other international jurisdictions, such as Singapore and Hong Kong, as opposed to codifying common law as some have done. One key advantage of this approach is that we are able to benefit from the entirety of evolving case law, which is critical, particularly in the area of wealth management, where standards, norms and practices are evolving. Our regulatory structure is alive and responsive.
What role do you see for ADGM in developing the financial technology (fintech) space?
Al SAYEGH: As an international financial centre and a regulator we embrace all aspects of innovation that enable growth and facilitate development. ADGM aims to enhance and increase the size of Abu Dhabi’s financial services sector and its contribution towards a sustainable GDP. We understand the necessity of preparing for the future by strengthening our core and embracing new changes. We are living in a world where transformational technologies are pushing the boundaries of economic opportunities while challenging current business models. Today, the word “disruption” is mainstream, and we hear it used across all industries and sectors. All of this will have significant bearing on the scale and nature of jobs in our markets and economies. Fintech developments, such as blockchain, artificial intelligence, biometric applications and virtual currencies, are expanding the frontier of the financial services sector. In 2016 we saw over $17.6bn of venture capital investments in 1436 global fintech deals across 66 countries. So it is quite clear that the next decade will be a highly transformational one for financial institutions worldwide. At ADGM we have been aware of the potential and impact of fintech on our economy since we first began operations. Thus, in March 2016 we were the first jurisdiction in this region to announce our ambition to become a fintech hub to support, enable and accelerate fintech activities and development. We have moved quickly to create a sustainable ecosystem, including creating a conducive and balanced supervisory framework, launching a regulatory laboratory in November 2016 to support and nurture fintech start-ups, and working with stakeholders and partners to enable continuous development.
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