Dubai: Dubai's GDP is expected to grow between 4.5 and five per cent in 2012, Shaikh Ahmad Bin Saeed Al Maktoum, Chairman of the Dubai Supreme Fiscal Committee, said at the Dubai Economic Outlook 2012 conference yesterday.
"In spite of the difficulties Dubai has experienced, particularly in 2009 and early 2010, its strategy of creating new opportunities through diversification has succeeded in bringing about economic prosperity and stability," he said.
Shaikh Ahmad said Dubai's economy returned to positive growth in the last two years, albeit at a moderate pace, compared to the pre-2009 phase.
"According to available estimates, GDP grew by about 2.5 per cent in 2010 and by more than three per cent in 2011, In 2012 GDP is expected to grow at 4.5 per cent," he said.
"We do recognise that we have been confronted with challenges due to a combination of unfavourable international developments and the legacy of high growth objectives, but we have been standing up to those challenges successfully."
The global financial crisis impacted Dubai's property and construction sector, he said, driving down its economy by 2.5 per cent when the government had sought a standstill to restructure $26 billion (Dh95.5 billion) of Dubai World's $59 billion debt. Dubai has come back from the crisis and emerged stronger, he added.
On the sidelines of the conference, Shaikh Ahmad told reporters that he is satisfied with the performance of Dubai's economic growth, adding that there are no plan to issue new bonds.
‘Always there to support'
He said the Dubai government would support its entities and organisations whenever they needed it.
"We will always be the essential back-up to all our government organisations whenever there is a need. I am pleased with the business performance in Dubai," he said.
When asked to comment on a $10 billion debt restructuring of Dubai Group to deal directly with creditors, Shaikh Ahmad said: "The Supreme Fiscal Committee has left Dubai Group to [make] their own negotiation with creditors; however, the Dubai government will be always there to support them.
"Dubai's government-related entities have once again exhibited strong determination and ability to service debt obligations and we have seen ratings upgrades reflecting strong internal revenue generation.
"As a part of our overall prudent approach in managing public finance we have rationalised the use of public funds and have set tighter budget controls for 2012," he said.
Shaikh Ahmad reiterated that the policy the government followed to diversify its economy has been the cornerstone of enabling Dubai growth.
Unique opportunities
"Dubai was able to create unique economic opportunities and attract the best of entrepreneurial and business leadership, with a strong commitment to free market, fair competition and economic diversification."
In spite of the difficulties Dubai had experienced, particularly in 2009 and early 2010, Shaikh Ahmad said that the strategy of creating new opportunities through diversification has succeeded in bringing about economic prosperity and stability.
Economic activity and prosperity has traditionally been centred on the trade, logistics and tourism sectors, he said.
"We see these sectors firmly in the driving seat once again, supported by an unrivalled infrastructure, global enterprises and growing reputation as an international destination. "Together, trade, logistics, transportation and tourism accounted for almost 60 per cent of Dubai's GDP in 2011."
These sectors have recently experienced vigorous growth, as demonstrated by the buoyancy in tourism and hospitality and the substantial increase in passenger traffic through Dubai International Airport in 2010 and 2011.
The financial sector has also remained resilient and robust, in spite of the real estate lending challenges, he added.
