DUBAI'S DIVERSE SECTORS DRIVE ROBUST ECONOMIC GROWTH AND VALUE CREATION
Date: 20-Dec-2023 | Category: News & Updates
Dubai a global economic hub, represent prosperity and growth significantly contributing to the UAE's economy . In the first quarter of this year Dubai's real GDP grew 2.8% year on year reaching 111.3 billion. The Dubai Economic Agenda D33 aiming to double the emirate's economy over the next decade serves as a strategic foundation fostering a new cycle of growth and value creation.
This year as Dubai hosts the UN climate summit it faces a crucial moment for it's macroeconomic journey. Historically dominated by the hydrocarbon industry contributing around 30% to the country's GDP. The recent revelations about the UAE's global ranking in net-zero-busting plans for oil and gas expansion highlight the delicate balance Dubai seeks between economic growth and environmental sustainability. Dubai has actively engaged in a series of Comprehensive Economic Partnership Agreements (CEPA) with rapidly growing economies such as Turkey, Indonesia, India, and Cambodia.
The emirate has successfully diversified into sectors such as finance and banking, real estate, tourism, and technology. The non-oil sector particularly finance and banking has solidified Dubai's status as a global financial center.
Dubai's tourism industry has been a major contributor generating $28.5 billion over the past decade. With a strategic focus on becoming a shopping destination the sector aims to welcome 40 million hotel guests by 2031 projecting a growth rate of 8 to 10 percent. The UAE's substantial spending on marketing and advertising totalling $410 million in the first quarter reflects the rapid growth in digital marketing . It demonstrating increased competition and heightened consumer engagement.
The transportation and logistics sector with a growth rate of 10.5% in H1 2023 contributes 42.8% to overall growth. The rise in demand for national carrier services evident in a 56% growth in passenger numbers has played a pivotal role in this success. Trade activities have shown resilience achieving added value of AED 53.6 billion marking a 1.7% growth compared to the same period in 2022.These activities contribute 23.9% to the GDP and 12.9% to total growth.
The Dubai real estate industry's is witnessing a significant growth with construction companies contributing around 6.3% to GDP. Real estate activity reported a growth of 3.6% contributing 8.2% to the overall economy and 9.2% to total growth. Real Estate surged in H1 2023 reflecting continued interest in Dubai's property market. Wholesale and retail trade retained its position as the largest contributor to the economy, constituting 22.9% of the GDP.
Dubai's health and hospitality sector fuelled by the pandemic's focus on well-being is set for significant growth. More licensed health facilities and healthcare reforms create a 60% growth opportunity by 2023.The F&B service sector saw a 9.2% boost in H1 2023 adding 3.5% to the economy and 9.5% to overall growth
Dubai's skyline reflects its commitment to development backed by a $23 billion investment in July 2022. Ongoing projects like the railway network, Dubai Urban Tech District, and Rasid Solar Park expansion will drive construction offering jobs and boosting the economy. The Finance and insurance sector grew by 2.7% contributing 11.9% to the GDP with added value of AED 26.6 billion.