Dubai's economy continues to recover from global financial crisis

Dubai's real estate sector posted improvement this year, officials say. Above, construction cranes are seen near Burj Khalifa in June 2012. [Jumana El-Heloueh/Reuters]

Dubai's real estate sector posted improvement this year, officials say. Above, construction cranes are seen near Burj Khalifa in June 2012. [Jumana El-Heloueh/Reuters]

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Recent figures herald a rebound in Dubai's real estate sector and improvement in its overall economic performance, economists and officials told Al-Shorfa.

The International Monetary Fund (IMF) projected that the UAE's Gross Domestic Product (GDP) will grow by 2.3% this year, with the tourism and commerce sectors posting positive growth rates in the first half of 2012.

In addition, officials anticipate that Dubai's individual Gross Domestic Product (GDP) will increase by up to 4.5% this year, said Sheikh Ahmed bin Saeed Al Maktoum, chairman of the Dubai Supreme Fiscal Committee.

This growth will be driven by the tourism, commerce and industrial manufacturing sectors, he said.

According to the UAE's Ministry of Finance, Dubai's government allocated 32.3 billion dirhams ($8.8 billion) to infrastructure projects in 2012, marking a return to big spending on such projects.

Some of these projects had been stalled due to lack of funding, in conjunction with an earlier trend to reduce the budget deficit as officials attempted to minimise the impact of the 2008 global financial crisis.

Real estate growth

"The residential transactions recorded during the second quarter of this year totalled 3,165 -- an increase of 15% compared to the first quarter," Marwan bin Ghalaita, CEO of the Real Estate Regulatory Authority (RERA) in Dubai, told Al-Shorfa.

Residential transactions totalled $7.1 billion in the first quarter of 2012 combined, he said.

Electricity production also increased in the second quarter of 2012, "which confirms an increase and growth in the number of consumers" and indicates that the number of residential and commercial units purchased has increased, according to Youssef Jibreel, executive vice president of the Dubai Electricity and Water Authority (DEWA).

Electricity production registered a 3% growth rate compared to last year, reaching 9,605 gigawatt-hours in the second quarter of 2012 compared to 9,329 gigawatt-hours in the second quarter of 2011.

Peak needs for electricity also registered a 3.8% increase compared to the same period in 2011, reaching 6,165 megawatts in the second quarter of 2012.

These figures confirm the real estate sector is growing, he said.

Dubai's overall economic performance is improving, economist Dhia Abdel Aal told Al-Shorfa.

"Dubai's economy was able to recover from the effects of the financial crisis in the past three years, and is currently preparing for the start of a stage of growth, thanks to the solid performance of key sectors that support the economy of the Emirate," including the commerce, tourism, logistics, financial, shipping and air transport sectors, he said.

Abdel Aal told Al-Shorfa that Dubai's non-oil external trade reached 602 billion dirhams ($164 billion) in the first half of 2012, compared to 537 billion dirhams ($146 billion) in the corresponding period of 2011, a12% increase.

Such factors contributed to a decline in Dubai's inflation rate in the first half of 2012, which positively impacted the performance of all economic sectors, according to a report issued by the Dubai Statistics Centre.

In addition, improvement in consumer purchasing power and relative price decreases bolstered the demand for goods and services, leading to increased production in various sectors to meet this demand and improving the emirate's economic performance, the report said.

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    ISAR AHMED KHAN PARIHAR

    2012-9-23

    SINCE VERY LONG TIME THIS IS VERY GOOD NEWS I HAVE HEARD.BECAUSE I LIKE & LOVE DUBAI.BEST WELL WISHER OF UAE !!!