Here’s Why Dubai’s Economy Continues to Boom
The latest figures show that the non-oil private sector in Dubai continues to grow. Numbers from the IHS Markit Dubai Purchasing Managers' Index for October 2019 show a rise from 52.6 to 54.6.
As detailed in a report on The National, this is the most impressive expansion seen since July of this year.
What is the reason for this?
David Owen is an economist at IHS Markit, which is the firm that compiles and publishes this data. He pointed out that business conditions in Dubai had “strengthened at an accelerating pace”. Owen stated that the performance of the travel and tourism sector was one of the main drivers of this.
Output numbers and employment figures increased, with job creation now as high as it has been in the last 21 months. It is expected that the build-up to Expo 2020 will help to further drive demand, with over 25 million visitors expected during the six months that it will run for.
Executive Director of the Dubai Statistics Centre Arif Al Muhairi explains that the flexibility of the economy and the strong infrastructure are two important reasons why the city continues to register economic growth.
Which companies and industries are doing well?
Of course, the oil industry remains a huge part of the Dubai economy. However, there are numerous other sectors that are also contributing to the city’s sustained growth. For example, the wholesale and retail sector contributes just over a quarter of Dubai’s overall GDP. This area has produced success stories such as Surplus Stores and Retail Arabia.
Travel and tourism remains a profitable business here too. The Emirates Group has over 250 aircraft flying to more than 150 destinations worldwide. Their turnover is currently at around US$27.9 billion and at the time of writing they also have an additional 170 new aircraft on order to meet demand.
The leisure industry is another major player. Dubai Parks and Resorts is the owner of the biggest leisure and theme park in the Middle East, with more than 100 rides and attractions. They have been reporting steady increases in visitor number over recent years, to 2.78 million in 2018. Recently, they have suggested that they will be adding new, world-record rides.
Real estate is another area that is booming in Dubai, as the strong economy raises demand for properties. The Bayut website receives more than 2.8 million visits each month and obtained $160 million in start-up funding. In addition, it was listed by Forbes Middle East in its prestigious list of the Top 100 Real Estate Companies for 2019.
Looking to the future
Expo 2020 has already been labeled as the “world’s greatest show”. This massive event will bring together some of the biggest national and international brands in a luxury setting. With over 200 restaurants and attractions such as the world’s biggest 360-degree projection surface and the UAE’s first opera, there is something for every taste.
This event should ensure that forward-looking businesses continue to grow in Dubai. While many of the world’s other major economies are slowing, the diverse and vibrant Dubai economy looks set to carry on expanding.