(MENAFN - The Peninsula) Global assets under management (AuM) will exceed 100 trillion by 2020, with compound annual growth (CAGR) of nearly 12 percent for Middle East and Africa. Meanwhile, the pension fund in the Mena region will reach close to 5 trillion by 2020.
Research from PwC predicts that global AuM will touch around 101.7 trillion by 2020, from a 2012 total of 63.9 trillion. This represents a CAGR of nearly 6 percent.
The report, "Asset Management 2020: A brave new world", also finds that assets under management in the SAAAME (South America, Asia, Africa, Middle East) economies are set to grow faster than in the developed world in the years leading up to 2020, creating new pools of assets that can potentially be tapped by the asset management industry.
PwC also said that the local population of the GCC countries who work for government entities are offered great state-administered pension funds. Therefore, PwC predicts pension fund assets will grow by 8.8 percent a year to reach 5.0 trillion by 2020 from a 2012 total of 2.4 trillion. Globally, PwC predicts pension fund assets will grow by 6.6 percent a year to reach 56.5 trillion by 2020 from a total of 33.9 trillion in 2012.
AuM growth in the Middle East will be mainly driven by positive economic outlook, family businesses and entrepreneurship and the population demographics.
The research note said that diversifying economies, great investment opportunities and favourable regulation complemented by highlight events such as Qatar FIFA World Cup 2022 and Dubai Expo 2020 will attract the capital inflow into the region.
It also said that the family businesses in the Middle East are very powerful and they control 75 percent of the private sector.