Dubai: The economy of Dubai has continued to grow at a fast pace in 2017, guided by a leadership that has its eye on the future and a government committed to the emirate’s sustainable development and global leadership, said Sami Al Qamzi, Director-General of Dubai Economy.
“The growth is expected to continue unabated in the next two years supported by rising domestic demand and a cyclical recovery in the global economy and in spite of economies elsewhere in the region slowing down to adjust to oil price fluctuations,” added Al Qamzi.
Real GDP growth in the emirate is set to reach 3.2 per cent this year, 3.5 per cent in 2018 and 3.7 per cent in 2019 as outward-oriented strategies and policies as well as sharper focus on diversification, sustainability, and infrastructure development will further enhance economic performance.
Dubai Economy’s report added, “Global trade is also anticipating a recovery to 3.6 per cent growth in 2017 as against 1.3 per cent during the previous year. The policy of openness adopted by the UAE across trade and economic activity in general is bringing goods manufacturers and service providers to Dubai, enhancing and diversifying exports from the emirate and further integrating the emirate into global value chains.”
“Dubai’s prominence as regional and global hub also grew in 2017 as total trade [direct and free zones] reached Dh985 billion during the first nine months, a 3.5 per cent growth over the same period of 2016.
Outpacing global growth
Improving quality of goods and services available in Dubai along with a competitive Tourism and sea and air Transport sector saw the emirate outpacing global growth and attracting 12 million tourists during the first nine months of 2017, an increase of 7.5 per cent year-on-year. Globally, average tourist arrivals stood at 4 per cent in the same period and the wider Middle East saw a slump of -4 per cent, as per the World Tourism Organisation. Continuing investments in Dubai’s travel, tourism, leisure and hospitality sectors will raise its profile as a destination and attract more tourists, in line with the Dubai 2021 Plan to welcome 20 million visitors by 2020.
Three target sectors in the Dubai Industrial Strategy 2030 performed exceptionally well in 2017 compared to last year. They are: manufactured food exports (16 per cent growth), aluminium and metal exports (13 per cent) and machinery and equipment exports (11 per cent). In line with the Dubai 2021 Plan and the Dubai Industrial Strategy as well as the city’s “Eye on the Future” theme, group financing platforms have been set up to introduce investors to emerging entrepreneurs in the city, such as the Eureka Group Finance Platform.
The Trade sector is expected to contribute 28 per cent of the GDP in Dubai in 2017, while the contribution of the Logistics sector (16 per cent) and of the Financial Services sector (11 per cent). Tourism is expected to see a growth of 5.1 per cent and the sector is expected to retain a 5 per cent growth rate in the next two years.
The Real Estate and Business Services sector in Dubai is expected to grow by 4.3 per cent, 3.8 per cent and 3.9 per cent over 2017, 2018 and 2019 respectively, while the Manufacturing will grow by 3 per cent, 3.8 per cent and 4 per cent during the same period, supported by the Dubai Industrial Strategy. The Transportation sector will be a major catalyst of growth in the Construction sector too during the next two years, especially since major investment projects, including the Etihad Rail, the Dubai Metro extension and the expansion of the Jebel Ali Container Port are being implemented. Transportation will also thrive on Dubai’s growing significance as a logistics hub located between three continents and along the most important trade routes.
Dubai has moved to new levels of growth and prosperity, where innovation, productivity of capital and labour, ease of doing business, a diversified base of high value-added economic activities, and economic resilience to external as well as internal shocks are the focal points. Promoting the role of innovation in the development process is the responsibility of all sectors of the society and demands a change in the culture of individuals and institutions. It requires keeping abreast of cutting edge technology, such as nanotechnology and the Internet of Things, as well as integrating such technologies into production processes and service delivery.
The latest economic outlook published by Dubai Economy underlines the continued dominance of the Trade, Logistics, Tourism, Manufacturing and Real Estate in the emirate over the coming years. The Dubai budget for 2018 has sought to accelerate the transition towards a knowledge economy by allocating 8% of the total government spending to develop performance and establish a culture of excellence and innovation.
“Concerted efforts to promote excellence, creativity and innovation will make Dubai a global platform for innovative industries and a preferred destination for international companies looking for an integrated environment suitable for growth and sustainability. Dubai has also launched initiatives such as the Mohammad Bin Rashid Centre for Government Innovation, the Hamdan Innovation Incubator [Hi2] and the Dubai Innovation Partners initiative to stress on innovation as the way forward,” concluded the report.