Sunday, March 20, 2011

Real GDP growth of 3% to 5% predicted in Dubai this year

The economy in Dubai is likely to grow 3 to 5 percent in actual terms this year, backed by the strong support of tourism, trade and other sectors, revealed a senior businessman in Dubai.

The Chairman of Dubai Chamber of Commerce and Industry, Abdul Rahman Al Ghurair, mentioned that the sharp downturn in the real estate sector of the emirate, following the global fiscal distress of 2008, brought down the inflation and increased the capital flow.

Further, given the positive growth rate recorded last year, coupled with excellent investment environment in Dubai at present, and the positive feedback from investors, Dubai is likely to record a real GDP growth of 3 to 5 percent this year.

Several factors, including better performance of trade, tourism and financial sectors have contributed in predicting the projected growth this year, which is more than 2.5percent of that recorded last year.

The figures for 2010 showed that exports and re-exports in Dubai surged 15.2percent, touching Dh.214.4bn from Dh.186.1bn in 2009. For the year 2011, the beginning was quite encouraging with exports and re-exports having jumped by 24.2percent, touching Dh.19.7bn in January. The figure grew by 8.3percent touching Dh.17.5bn in February (year-on-year comparison).

Even the services sector is one of the vital stimulants in Dubai economy. The sector has been performing well, recording annual growth of 16percent. The other sectors contributing to Dubai growth are tourism and financial services which has been solid and flexible in the recent past, and are likely to grow in near future.

Further, the investment environment will be strengthened with the opening of new hotels, completion of infrastructure projects, and strengthening of banking sector.

Meanwhile, the real estate sector has definitely instilled positivity in the emirate, as there were several commercial and residential units being supplied to the market, and consequently more companies and more people. With decline in value of properties, there has been depressed inflation, as the real estate and utilities sector constitute 36.1percent of consumer price index. The depressed inflation, in-turn, has led to attracting more capital into Dubai, while also boosting its competitiveness as global financial and business centre.

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