Dubai: The trade and logistics sectors will replace real estate and tourism as Dubai's main economic drivers, a top private sector representative said Sunday.
"Real estate is an enabler. [The] trade and logistics [sectors] are the main ones, the rest will be somewhere in between," Hamad Bu Amim, director-general of the Dubai Chamber of Commerce and Industry, said at ‘The Gulf Region after the Global Economic Crisis: The Way Forward' economic forum.
Real estate correction, falling rents and property prices brought several mega-projects in the city to a halt last year as liquidity dried up.
"Real estate is moving from [being] a key driver to a supporter because... it will definitely take a longer time to recover.
"If we continue to depend on real estate to drive us forward as it did in the last three to five years, I don't think it would play that role," he said.
He said the shift would bring more focus to the trade, logistics and financial sectors instead.
"This is the basics of Dubai and this is the future,' he said, speaking of trade.
Last December, the chamber announced export figures from its members valued at Dh18.5 billion.
Meanwhile, officials at the forum said that Dubai is "firmly on the road to recovery."
"Despite a challenging 2009, a 2010 come-back looks imminent to us as the government continues to move forward with its infrastructure expansion plans such as the Dubai Metro, Al Maktoum International Airport and other major infrastructure projects," said Hesham Al Shirawi, second vice-chairman of the DCCI.
Officials cited rising oil demand and output this year as important indicators of recovery in the region.
The region's oil producing countries are banking on an average price of oil for this year of $75 a barrel.
However, there are risks on the road of recovery.
An increasing reliance on government to protect the private sector from the effects of the downturn have caused it to lose its advantage, according to Henry Azam, regional chief executive of Deutsche Bank.
"We're going back to the 80s unfortunately, asking governments to step up. Apparently, we're trenching," he said.
Bu Amim said that while governments are playing a greater economic role during the downturn, "hopefully, this will be a short-term role."
Market confidence
Transparency remains a major basis in the region for the return of investor confidence, officials said at ‘The Gulf Region after the Global Economic Crisis: The Way Forward' forum yesterday.
"Data and information here are scarce. We're lagging behind in this," Hamad Bu Amim, director-general of the Dubai Chamber of Commerce and Industry, said.
There is an issue with communication and transparency, he added, as well as in investor protection laws and regulations.
Meanwhile, Henry Azam, regional chief executive of Deutsche Bank, said that the local stock markets are suffering from the lack of news related to Dubai's financial restructuring.
