Dubai: The composite Business Confidence Index in Dubai rose to more than 122 points during the third quarter of the year, an increase of over 15 per cent on the previous quarter and 6.5 per cent on the same quarter of 2011, according to the latest quarterly business survey conducted by the Department of Economic Development (DED) in July-September 2012
The overall assessment for the fourth quarter of 2012 is that business will get better, with 95 per cent expecting either improvement or stability, the survey said.
While the level of optimistic expectations were highest among manufacturing, services and trading firms, the survey showed that almost 68 per cent of the businesses see stronger result during the final quarter of 2012 while 22 per cent expect stable outcomes.
At 122 points, the Dubai Business Confidence Index remarks the optimistic business environment due to the current and impending festive season and growing inbound tourist traffic.
The survey revealed that the final quarter of this year will bring higher sales and volumes for businesses as 63 per cent of the firms are planning to increase their new purchase orders in the next quarter. The manufacturing sector expects higher sales volume than other sectors, with 78 per cent expecting rising sales in the next quarter, compared with 67 per cent in the previous quarter.
Full swing
SMEs expressed higher optimism on sales, revenues, volumes and profits than large companies while exporters have higher expectations on almost all counts compared to domestically-focused firms.
“It is now clearly established that business in Dubai is in full swing and growth is here to stay. The overall business sentiment and expectations for the rest of the year shows that the sectors key to Dubai’s economy are set to perform remarkably well and fuel growth,” said Sami Al Qamzi, Director-General, Department of Economic Development.
“The measures being implemented by Dubai to shore up investor confidence and facilitate economic activity have had a profound impact as is evident from the input businesses provided in the latest quarterly survey,” Al Qamzi added.
Dr Abdul Hameed Radwan, Leading UAE-based economist, told Gulf News: “While all current indicators show a real optimistic growth in the businesses across Dubai, there should be a conservative frame for this boost.”
“UAE and Dubai is an open economy which in turn is exposed to the Europe economic turmoil, but the city incentive business policy could benefit from the world economic crisis as well as of the political tension in the region.”
“On the long term vision there should be no excessive optimism as this economic boost came a long way of economic slow down,” Radwan said.
“And while the financial market in Dubai didn’t witness and remarkable hike as well as no one can guarantee the world economic and political situation, caution is required at this stage.”
“We don’t want to get back to economic bubbles,” he added.
The survey revealed that within the services sector, construction-related firms are the most optimistic expecting new projects from local as well as regional markets.
