Inflation won’t deter Dubai from attracting investment, official says
Authorities have taken measures to contain rising risks in the real estate market
Dubai: Inflation won’t be a deterrent for more investments in Dubai in the next three years, Sami Al Qamzi, director-general at Department of Economic Development, told Gulf News.
Dubai’s consumer price inflation climbed to 3.07 per cent at the close of the third quarter of 2014 as compared to 1.02 per cent at the close of the same quarter last year, according to data published by the Dubai Statistics Centre.
Housing and utility costs, which account for almost 43.7 per cent of consumer expenses, jumped 5.11 per cent year-on-year.
“The government took some measures to try to control the inflation. The economic sectoral committee also put some recommendations to try the control inflation and avoid the negative impact on the growth of the economy,” Al Qamzi said.
In the last three years, the government has tried to control speculation in the real estate market in various ways, Al Qamzi said.
In Dubai and Abu Dhabi, the annual real estate price increase slowed to around 15 per cent, year-on-year, in September 2014 — down from 35 per cent in March 2014.
To contain rising risks in the real estate market, the authorities have taken measures which include tightening mortgage lending requirements, increasing land supply, and imposing higher transaction taxes.
On asked whether inflation could impact investments in Dubai, Al Qamzi added: “I don’t see that [happening] for the next three years because the percentage is not that high.”
He believes investor confidence will attract more investments into Dubai.
“We took a lot of effort to try to maintain the business environment that keeps attracting business,” Al Qamzi said.
He sees Dubai’s GDP growing by 4.6 per cent in 2014 and expects this momentum to hold through 2015.
