Dubai projected to grow 3-5%
Property decline cut inflation and attracted capital inflows
Dubai’s economy is projected to rebound by three to five per cent in real terms this year on the back of stronger performance in the tourism, trade and other sectors, a senior businessman from the emirate was reported on Sunday as saying.
Abdul Rahman Al Ghurair, chairman of the Dubai Chamber of Commerce and Industry, also said a sharp downturn in the emirate’s property sector following the 2008 global fiscal distress depressed inflation and spurred a capital inflow.
“With the positive growth rate recorded in 2010 and the excellent investment climate in Dubai, as well as the positive forecasts of investors, the emirate is expected to record real GDP growth of 3-5 per cent this year,” Ghurair told the Arabic language daily Alkhaleej.
He said several factors supported this year’s projected growth, far above the 2.5 per cent expansion recorded last year, including better performance in the trade, tourism and financials sectors.
His figures for 2010 showed Dubai’s exports and re-exports surged by 15.2 per cent to around Dh214.4 billion from Dh186.1 billion in 2009.
He said the start of 2011 was even more encouraging, with exports and re-exports leaping year-on-year by 24.2 per cent to Dh19.7 billion in January. In February, they swelled by 8.3 per cent to Dh17.5 billion.
“These figures reflect the strong start of the export and re-export sector, which ushers in a promising activity through the year,” he said.
“The services sector is another key sector and one of the most important stimulants in Dubai’s economy…this sector has also been performing well, recording an annual growth of 16 per cent during 1997-2007….other sectors that are also leading growth are tourism and financial services, which have proven to be solid and flexible over the past period…these sectors have the potential that will allow them to maintain growth in the next period.”
Ghurair said the investment climate in Dubai would further be strengthened by the inauguration of the new Al-Maktoum airport, the opening of more hotels, the completion of infrastructure projects and the strength of the banking system.
“As for the decline in the real estate sector, this has positively impacted business in the emirate as it has led to the entry of new commercial and housing units into the market and consequently more people and companies,” he said.
“The decline also depressed inflation as the real estate and utilities sector make up 36.1 per cent of the consumer price index in the emirate…the fall in inflation has really contributed to attracting more capital into Dubai and at the same time boosted its competitiveness as a global financial and business centre.”
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