Despite challenging financial conditions globally, Dubai continues to witness sustained net growth in the establishment of new businesses and increased airline passenger arrivals, according to Mohamed Ali Alabbar, Chairman of The Advisory Council of the Government of Dubai, a high-level economic advisory body established at the direction of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai.
Addressing over 250 private business leaders in Dubai, Alabbar, who is also Chairman of Emaar Properties, provided data on a range of key indicators of the economic health of the emirate, including its real estate sector, which is forecast to experience supply-demand equilibrium in 2009.
In November and December of 2008, the Government of Dubai issued 1,285 new business licences per month, up significantly from 1,045 per month for the same period in 2007. During November and December of 2008, the Government of Dubai cancelled 148 licences per month, in comparison to 131 licences cancelled per month during the same period in 2007. This shows that the number of new businesses set up in Dubai has grown, despite the global financial crisis, said Alabbar.
Airline passenger arrivals into Dubai have grown an average five per cent in the past two months, Alabbar highlighted. The number of passenger arrivals, not including transit passengers, was an average of over 1.5 million per month in the last two months of 2008.
Turning to the property sector, he pointed out that the most recent projections provided by the Real Estate Regulatory Agency (Rera) show that there is an expected supply of some 28,000 new homes in Dubai this year, with the three main developers controlling overall demand and supply. With the current trend of sustained growth of new residents, supply is forecast to be in line with demand this year, said Alabbar.
While stressing that Dubai is a fully integrated participant in the global economy and is therefore not immune to the current worldwide financial slowdown, he said: "Here in Dubai, we represent the trade, investment and knowledge hub for the Gulf, which has a population of 40 million and an economy that has grown three-fold in only five years to $1trn (Dh3.67trn). We are also in the heart of the wider Middle East, North Africa and South Asia region that is home to one quarter of the world's population.
"The challenges that confront us and our young, energetic population here in Dubai and the wider region are very much cyclical in nature," said Alabbar. "But we must adjust to such movement, and are already making the structural changes necessary to best manage this new economic reality. The Dubai Government has already set an example with the recent announcement of its budget focused on increased public spending, with no new government fees or taxes.
"No one has ever accused Dubai of being afraid to think big or new or different," he told the high-level audience.
"When the world is in the midst of a crisis of confidence, as it is today, confident cities with confident leadership are critical. We have to continue to show the world that some things are possible only in Dubai."