Dubai: Dubai's GDP grew 168 per cent in the period from 2000 to 2006, for an annual growth rate of 17.9 per cent. However, next year's growth is expected to slow to 6 per cent, the Dubai Chamber of Commerce and Industry said on Tuesday.
"These figures and our past successes cannot lead us to overlook the threat of the global financial cloud approaching the region," said DCCI director general Hamad Buamim, at a networking event.
"While, thankfully, our region is one of the few places in the world where growth is expected to continue based on the government's support of the major infrastructure projects.
"The country has predicted six per cent growth for next year and that is a big assurance for the world to come and do business in the Emirates," he added.
Buamim said there may also be a reduction in the number of companies operating in Dubai as the fallout from the global financial crisis takes hold.
The DCCI recorded 130,000 members in its August report with 66,040 owned by UAE nationals and 63,960 owned by other nationals.
Crucial months
Buamim said companies may start feeling the heat in the next six to nine months.
There may be a reduction in the number of companies, especially those with strong ties to countries hardest hit by the crisis such as the US and Europe, but he said small and medium enterprises (SMEs) in Dubai would remain largely unaffected.
"The nature of the SMEs here is they are mainly family owned and are very conservative in nature," he said.
"Their financing comes from the family so I don't they will be affected directly by the crisis. They might be affected on the demand side."
Buamim said the largest contributor to Dubai's GDP remained the real estate sector.
In 2007, the sector contributed eight per cent to the country's GDP with investments totalling Dh25.8 billion.
"The size of fixed investments in 2007 has grown to Dh144.5 billion against Dh121 billion in 2006. The investment percentage to domestic product has touched 20.7 per cent in 2007," said Buamim.
"Although the real estate and manufacturing sectors jointly contributed 35 per cent of the total investments in the country during 2007, industries such as medicine, petrochemical, building materials and food, continue to surge."
An investment of over $100 billion (Dh367.3 billion) into large scale construction projects by 2010 has also positioned the sector for significant growth. The sector's absolute contribution to GDP has increased by 325 per cent over the period from 2000 to 2006.
