The recent spike in coronavirus cases, mostly due to the highly transmittable Delta variant, has sent shock waves around the world casting renewed doubts about the still fragile economic recovery.
Many countries have scrambled to impose new restrictive measures to stem the spread of Covid-19 while the ongoing floods in China, India and parts of Europe, such as Germany last week and England this week, added to the economic worries.
In the midst of the increasing economic pessimism, Dubai’s Land Department reported this week that the emirate’s property market put together 6,388 transactions worth Dh14.79 billion in the month of June, the highest in value since 2014.
“The sales in June 2021 are 44.33 per cent higher in terms of volume and 33.2 per cent in value compared to May 2021,” the department said. This brings the year-to-date total to 27,373 transactions worth Dh61.97 billion, compared to last year’s total number of 35,041 transactions worth Dh71.87 billion.
Compared to Q2-2020, this year showed a staggering increase of 183.4 per cent for volume and 237.79 per cent for value of sales transactions. When compared to Q2-2019, well before the outbreak of Covid-19, the second quarter of 2021 saw an increase of 78.27 per cent for volume and 102 per cent on value.
This is an important sign of the steady recovery of the UAE and Dubai’s economy as real estate represents a key component of the country and the emirate’s economy. For years, the health of real estate has been one of the main parameters of the health of our economy. As such, it is safe to say that while many in the rest of the world continue to reel under the economic impact of the pandemic, the UAE economy is on solid footing to grow.
The latest outlook report of the International Monetary Fund (IMF) notes that the UAE economy is set to grow by 3.1 per cent for 2021. In the report, the IMF said the global economic recovery would be dependent mainly on vaccine roll-outs, exposure to tourism and government policy enhancements. The UAE is way ahead of many others in these three essential terms.
According to official figures, nearly 69 per cent of the UAE population has been fully vaccinated with 16,495,917 vaccine doses administered. The efficiency and the speed of the vaccination has allowed a safe and steady flow of tourists into the country. The UAE’s airports are busy as ever.
Meanwhile, the federal and local governments continue to fiscally support businesses and other parts of the economic activities. They have already spent almost AED400 billion to support the economic recovery. The UAE Central Bank’s Targeted Economic Support Scheme, the Dh50 billion worth of zero-cost loan initiative, was extended to until June 2022 to insure a steady flow of liquidity into the markets.
Expo2020, which is nearing its much anticipated opening in October, and the current rise in oil prices, indicate that the UAE economy may very well exceed even the most optimistic expectations.