Lunate, a global investment manager based in Abu Dhabi, has launched a fund that will allow private companies nationwide to offer their employees investment returns on end-of-service benefits for the first time in the UAE.
The Ghaf Benefits scheme, launched on Tuesday will permit employers in companies across the UAE to transfer employees' end-of-service gratuity to the fund to receive potential investment returns. Named after the UAE's national tree known for stabilising sand in the desert, it is meant to give employees a chance to be grounded financially by introducing to the country, and region, its only nationwide plan for investing retirement savings.
Also read: Can employee saving schemes be a substitute for pensions in the UAE?
Currently, formal pension plans are only available to Emirati citizens and GCC nationals, in addition to some employees operating in free zones across the UAE.
This private scheme that applies to mainland UAE companies set up outside of free zones brings the Gulf country's 85 per cent expatriate population closer to the possibility of future pension plans. It also addresses a major issue for asset managers in the region, according to a managing partner at Lunate.
This is tectonic. This is one of the most critical initiatives when it comes to Middle East, North African asset management
Seif Fikry,
managing partner at Lunate
A "problem in the region is access to long-term capital", Seif Fikry told The National. "Long-term capital today in the region is mainly dedicated to sovereigns."
This scheme, Mr Fikry said, is the first time a large pool is available locally for asset management industries, allowing them to grow and flourish.
"This is tectonic. This is one of the most critical initiatives when it comes to Middle East, North African asset management," he added.
How it works
The Ghaf Benefits fund operates by offering six investment funds that allow private company employees in the UAE to invest their end-of-service benefits in conventional and Sharia-compliant options, and at varying levels of risk.
Sherif Salem, partner at Lunate and one of the architects of Ghaf Benefits fund, said his company's scheme will simplify benefits management by allowing employers to transfer their employees' traditional end-of-service benefits to be managed by Ghaf.
"What the employer will do, in this case, in the new alternative scheme, is that on a monthly basis, if the employee has worked for less than five years, they will transfer [a prorated] 5.83 per cent [21 days] of their basic [annual] salary. More than five years, 8.33 per cent [30 days] of their basic salary."
This is in line with the UAE's Ministry of Human Resources and Emiratisation (MoHRE), which allows an employee to add an additional 25 per cent of their salary. Those earning less than Dh4,000 ($1,100) a month are not eligible to invest in the medium or high risk schemes.
Then the employee has the option to invest in funds that range from low, medium or high risk, but are generally more conservative and balanced compared to similar global schemes.
Mr Salem said this was only possible due to federal government's establishment of clear regulations on its new alternative voluntary scheme in November 2023, in partnership with the Securities and Commodities Authority.
MoHRE authorised Lunate, along with Dubai-based private join stock company Daman Investments as the first funds to incorporate the new scheme earlier. First Abu Dhabi Bank and National Bonds gained approval in 2024.
With Lunate's Ghaf Benefits Fund launch on Tuesday, private companies have already expressed interest and sovereign wealth fund investor ADQ has signed a memorandum of understanding with Lunate to explore becoming one of the early adopters. ADQ has Etihad Airways and Aramex among more than 25 companies in its portfolio, with tens of thousands of employees.
Where's the risk?
Discussions about creating an alternative voluntary scheme have taken place as early as 2015, according to David Daly, partner at the Gulf Tax Accounting Group in the UAE.
"We've been talking about this a long time," Mr Daly said. He believes the UAE's readiness to move forward with the private sector scheme is due to its belief that there is enough appetite in the market.
"This is the government letting go and allowing the market to do its own thing," said Mr Daly. "It's a big change. They will want to see how it impacts the local economy in terms of investment.
"What you don't want is to bring a system that in five years' time, because of weaknesses, it all falls over, lots of different schemes collapse, people lose money, and confidence falls out of the market. And all of a sudden, nobody wants to be involved."
The private voluntary schemes face these risks, but also positive returns to build a stronger wealth economy, he told The National.
"It may force the government to begin to much more deeply regulate the wealth industry. And by that I mean the people who want to take your personal wealth and invest it for you for the future.
Mr Daly said that would quickly mature the wealth management industry in the UAE and attract more regional and global investment.
"The big advantage, I would say to the UAE as the first mover, if these UAE funds are able then to invest GCC-wide, so Saudi Arabia is OK with that money being invested in their country, then the UAE becomes the investment hub that also brings in jobs, helps develop the industry – everything matures."
First movers
Mr Fikry says Lunate is ready for the risks and complexities involved, which are expected when building a new industry and ecosystem. He said the company's three managing partners have repeated experience in being the first to execute projects, including special purpose acquisition companies and then exchange-traded funds to the UAE about five years ago.
He said their approach to overcoming obstacles is a combination of working with the right global partners and learning how to operate within UAE laws, regulation and market.
"You need to understand that our population is small compared globally," he said, and that it's also expensive to operate in the region.
"Asset management in our part of the world, trusted admin, transfer agents, lawyers – we don't have that ecosystem."
What is motivating, said Mr Fikry is the potential future offerings. Countries with more mature retirement asset sectors contribute substantially to global economies.
In the US, the amount of retirement assets reached $37.8 trillion by the end of 2022, according to the US Retirement Assets: Data in Brief by the Congressional Research Service. Employer-sponsored plans were valued at $26.3 trillion, while Individual Retirement Accounts were $11.5 trillion.
To achieve the UAE version of this economic contribution requires improving offerings that have already made the region "stickier" said Mr Fikry, including golden visas and more.
"Historically speaking, working in the Gulf was what, two, three, four, five years, and then, people would leave?" he said, adding there has been a growing shift.
"You have to start thinking a little bit more long-term towards the rights of employees", he said, when it comes to their end of service given the country's nascent industry. The Ghaf Benefits fund is the way to start, he said.
The%20specs
%3Cp%3E%0D%3Cstrong%3EEngine%3A%20%3C%2Fstrong%3E4.0-litre%20twin-turbo%20V8%0D%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E666hp%20at%206%2C000rpm%0D%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E850Nm%20at%202%2C300-4%2C500rpm%0D%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3E8-speed%20auto%0D%3Cbr%3E%3Cstrong%3EOn%20sale%3A%20%3C%2Fstrong%3EQ1%202023%0D%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3Efrom%20Dh1.15%20million%20(estimate)%3C%2Fp%3E%0A
Bridgerton%20season%20three%20-%20part%20one
%3Cp%3E%3Cstrong%3EDirectors%3A%20%3C%2Fstrong%3EVarious%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%3C%2Fstrong%3E%20Nicola%20Coughlan%2C%20Luke%20Newton%2C%20Jonathan%20Bailey%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E3%2F5%3C%2Fp%3E%0A
The Facility’s Versatility
Between the start of the 2020 IPL on September 20, and the end of the Pakistan Super League this coming Thursday, the Zayed Cricket Stadium has had an unprecedented amount of traffic.
Never before has a ground in this country – or perhaps anywhere in the world – had such a volume of major-match cricket.
And yet scoring has remained high, and Abu Dhabi has seen some classic encounters in every format of the game.
October 18, IPL, Kolkata Knight Riders tied with Sunrisers Hyderabad
The two playoff-chasing sides put on 163 apiece, before Kolkata went on to win the Super Over
January 8, ODI, UAE beat Ireland by six wickets
A century by CP Rizwan underpinned one of UAE’s greatest ever wins, as they chased 270 to win with an over to spare
February 6, T10, Northern Warriors beat Delhi Bulls by eight wickets
The final of the T10 was chiefly memorable for a ferocious over of fast bowling from Fidel Edwards to Nicholas Pooran
March 14, Test, Afghanistan beat Zimbabwe by six wickets
Eleven wickets for Rashid Khan, 1,305 runs scored in five days, and a last session finish
June 17, PSL, Islamabad United beat Peshawar Zalmi by 15 runs
Usman Khawaja scored a hundred as Islamabad posted the highest score ever by a Pakistan team in T20 cricket
More from Rashmee Roshan Lall
Australia (15-1): Israel Folau; Dane Haylett-Petty, Reece Hodge, Kurtley Beale, Marika Koroibete; Bernard Foley, Will Genia; David Pocock, Michael Hooper (capt), Lukhan Tui; Adam Coleman, Izack Rodda; Sekope Kepu, Tatafu Polota-Nau, Tom Robertson.
Replacements: Tolu Latu, Allan Alaalatoa, Taniela Tupou, Rob Simmons, Pete Samu, Nick Phipps, Matt Toomua, Jack Maddocks.
Race 3
Produced: Salman Khan Films and Tips Films
Director: Remo D’Souza
Cast: Salman Khan, Anil Kapoor, Jacqueline Fernandez, Bobby Deol, Daisy Shah, Saqib Salem
Rating: 2.5 stars
Specs
Engine: 51.5kW electric motor
Range: 400km
Power: 134bhp
Torque: 175Nm
Price: From Dh98,800
Available: Now
Real estate tokenisation project
Dubai launched the pilot phase of its real estate tokenisation project last month.
The initiative focuses on converting real estate assets into digital tokens recorded on blockchain technology and helps in streamlining the process of buying, selling and investing, the Dubai Land Department said.
Dubai’s real estate tokenisation market is projected to reach Dh60 billion ($16.33 billion) by 2033, representing 7 per cent of the emirate’s total property transactions, according to the DLD.
UAE currency: the story behind the money in your pockets
Killing of Qassem Suleimani
KILLING OF QASSEM SULEIMANI
Joker: Folie a Deux
Starring: Joaquin Phoenix, Lady Gaga, Brendan Gleeson
Director: Todd Phillips
Rating: 2/5
ULTRA PROCESSED FOODS
- Carbonated drinks, sweet or savoury packaged snacks, confectionery, mass-produced packaged breads and buns
- margarines and spreads; cookies, biscuits, pastries, cakes, and cake mixes, breakfast cereals, cereal and energy bars;
- energy drinks, milk drinks, fruit yoghurts and fruit drinks, cocoa drinks, meat and chicken extracts and instant sauces
- infant formulas and follow-on milks, health and slimming products such as powdered or fortified meal and dish substitutes,
- many ready-to-heat products including pre-prepared pies and pasta and pizza dishes, poultry and fish nuggets and sticks, sausages, burgers, hot dogs, and other reconstituted meat products, powdered and packaged instant soups, noodles and desserts.
More on animal trafficking
UAE currency: the story behind the money in your pockets
Global state-owned investor ranking by size
1.
|
United States
|
2.
|
China
|
3.
|
UAE
|
4.
|
Japan
|
5
|
Norway
|
6.
|
Canada
|
7.
|
Singapore
|
8.
|
Australia
|
9.
|
Saudi Arabia
|
10.
|
South Korea
|
Sole survivors
- Cecelia Crocker was on board Northwest Airlines Flight 255 in 1987 when it crashed in Detroit, killing 154 people, including her parents and brother. The plane had hit a light pole on take off
- George Lamson Jr, from Minnesota, was on a Galaxy Airlines flight that crashed in Reno in 1985, killing 68 people. His entire seat was launched out of the plane
- Bahia Bakari, then 12, survived when a Yemenia Airways flight crashed near the Comoros in 2009, killing 152. She was found clinging to wreckage after floating in the ocean for 13 hours.
- Jim Polehinke was the co-pilot and sole survivor of a 2006 Comair flight that crashed in Lexington, Kentucky, killing 49.
The%20Boy%20and%20the%20Heron
%3Cp%3E%3Cstrong%3EDirector%3A%C2%A0%3C%2Fstrong%3EHayao%20Miyazaki%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EStarring%3A%3C%2Fstrong%3E%C2%A0Soma%20Santoki%2C%20Masaki%20Suda%2C%20Ko%20Shibasaki%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E5%2F5%3C%2Fp%3E%0A
The%20Specs
%3Cp%3E%3Cstrong%3EEngine%3A%20%3C%2Fstrong%3E3.6-litre%20twin%20turbocharged%20V6%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3E10-speed%20automatic%3Cbr%3E%3Cstrong%3EPower%3A%3C%2Fstrong%3E%20472hp%3Cbr%3E%3Cstrong%3ETorque%3A%3C%2Fstrong%3E%20603Nm%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3Efrom%20Dh290%2C000%20(%2478%2C9500)%3Cbr%3E%3Cstrong%3EOn%20sale%3A%3C%2Fstrong%3E%20now%3C%2Fp%3E%0A
WOMAN AND CHILD
Director: Saeed Roustaee
Starring: Parinaz Izadyar, Payman Maadi
Rating: 4/5
APPLE IPAD MINI (A17 PRO)
Display: 21cm Liquid Retina Display, 2266 x 1488, 326ppi, 500 nits
Chip: Apple A17 Pro, 6-core CPU, 5-core GPU, 16-core Neural Engine
Storage: 128/256/512GB
Main camera: 12MP wide, f/1.8, digital zoom up to 5x, Smart HDR 4
Front camera: 12MP ultra-wide, f/2.4, Smart HDR 4, full-HD @ 25/30/60fps
Biometrics: Touch ID, Face ID
Colours: Blue, purple, space grey, starlight
In the box: iPad mini, USB-C cable, 20W USB-C power adapter
Price: From Dh2,099
The%20specs
%3Cp%3E%3Cstrong%3EPowertrain%3A%20%3C%2Fstrong%3ESingle%20electric%20motor%0D%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E201hp%0D%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E310Nm%0D%3Cbr%3E%3Cstrong%3ETransmission%3A%20%3C%2Fstrong%3ESingle-speed%20auto%0D%3Cbr%3E%3Cstrong%3EBattery%3A%20%3C%2Fstrong%3E53kWh%20lithium-ion%20battery%20pack%20(GS%20base%20model)%3B%2070kWh%20battery%20pack%20(GF)%0D%3Cbr%3E%3Cstrong%3ETouring%20range%3A%20%3C%2Fstrong%3E350km%20(GS)%3B%20480km%20(GF)%0D%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3EFrom%20Dh129%2C900%20(GS)%3B%20Dh149%2C000%20(GF)%0D%3Cbr%3E%3Cstrong%3EOn%20sale%3A%3C%2Fstrong%3E%20Now%3C%2Fp%3E%0A