The Dubai GDP Growth is 4.6% - Evidence of Its Robust Economy

by Sweta Bose 14, Dec 2022

dubai gdp

Despite the worldwide slowdown, the Crown Prince recognized the importance of many organizations in the emirate's prosperity. The Dubai GDP increased 4.6% over the same period last year, to Dh307.5 billion, according to Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, the Crown Prince of Dubai & Chairman of The Executive Council.

The Crown Prince stated that Dubai's GDP growth is exceptional, and it was the result of the efforts of numerous public and private organizations to realize His Highness Sheikh Mohammed bin Rashid Al Maktoum's vision of making Dubai's economy a global benchmark for sustainability and resilience. Al Maktoum is the Vice-President & Prime Minister of the UAE and Ruler of Dubai.

All About the Remarkable Expansion of the Current GDP of Dubai

Now is the ideal time for your business setup in Dubai as the adaptable and effective economic structure, together with its capacity to monitor and foresee demand trends over the short and long term, ensures that it can quickly capitalize on opportunities and carry out its audacious quest for greatness. The Dubai Crown Prince thanked everyone who helped fuel this unprecedented expansion despite the world's deteriorating economy and unstable financial situation. 

According to HH, the performance demonstrated Dubai's wise plans, sustainable policies, and innovative public-private partnerships. Sheikh Hamdan urged all industries to keep innovating and changing course to keep Dubai's economy at the forefront of robust, dynamic economies.

The leading economic contributor to the emirate, wholesale and retail trade contributed 24.1% of Dubai's GDP between January and September of this year, according to the most recent economic data from the Dubai Digital Authority's Dubai Statistics Centre. With a year-over-year gain of 28% over the first nine months, the hospitality and F&B services outpaced all other sectors in terms of growth.

A Detailed Picture of the Dubai GDP by Sector

Let us look at a clear picture of the increased GDP scenario sector-wise. 

  • Increase in Commercial Activity by 1.6%

The Wholesale and retail trade industry in Dubai saw growth of 1.6% over the corresponding period in 2021, reaching a value of AED74 billion. This activity was responsible for 24.1% of Dubai's nine-month GDP and 9% (more than 0.4 percentage points) of GDP growth in the emirate. 

Dubai's thriving retail industry is the world's most important foreign company market. It is also a major international trade and re-export center, bridging the East and the West for items like capital goods, commodities, and consumer products.

  • Activity in Transport and Storage Sector Increased by 26.3%

The impressive rise in the "Transport and Storage" sector, which accounts for 2.5 % points or more than half of the 4.6 %-point growth in Dubai's GDP in the first 9 months of the year 2022, is among significant sectoral performances. The dynamism of Dubai's economy is demonstrated by the sector's relatively small contribution to overall GDP throughout the period—just 11.6%—which highlights how various activities and sectors work together to support and strengthen the emirate's economy.

During this time, the Transport and Storage sector's value rose to AED35.8 billion, a stunning 26.3% increase over the same time in 2021. The activity comprises moving people and goods by train, road, water, or air, and it contributed an astonishing 2.5 percentage points to growth in the emirate's GDP during that time. 

It also comprises related activities like freight handling, parking, terminal, and storage facilities. Due to a huge demand for air services, the sector's value and growth was driven mainly by the air transport industry. 

Due to the loosening of travel restrictions in most nations around the world, Dubai's airlines had a 151 percent rise in the number of passengers that flew during the first 9 months of this year compared to 2021 (during the same period).

  • Activity for Lodging and Food Services Increased by 28%

The hospitality and food and beverage industries outgrew all other economic sectors in terms of growth during this period. The Accommodation and Food Services activity grew by an astounding 28% compared to the same time in 2021, reaching a value of AED15.8 billion. 

The industry contributed 26 percent (1.2 percentage points) of GDP growth during the past nine months and 5.1% of Dubai's GDP. According to the Department of Economy and Tourism's most recent statistics, Dubai welcomed 10.12 million foreign tourists between January and September 2022, up from 3.85 million during the same time last year, a phenomenal increase of 163% year over year. 

The efforts of the appropriate authorities and government bodies, who planned and implemented a jam-packed and dynamic schedule of events and activities to draw tourists, can be attributed to the remarkable performance and a strong resurgence in the tourism industry.

  • Real Estate Activity Increased by 2.5 Percent

Dubai's real estate activity increased by 2.5% year over year, making up 9.1% of the emirate's GDP and adding 5% (0.23 percentage points) to the growth of the entire GDP. According to data from Dubai Land Department (DLD), the growth results from a 76% increase year over year in real estate sales during Jan-Sept. Of this year. 

The government of Dubai's economic stimulus programs and increased openness benefited the sector and increased investor trust.

  • 1.2 Percent Growth in the Financial Sector

From Jan-Sept. 2022, the value of financial and insurance activities increased by 1.2% from 2021 to AED32.8 billion. The industry contributed 3.0% (0.14 percentage points) of GDP growth over the past nine months and 10.7% of Dubai's GDP during that time.

According to data from the UAE Central Bank, loans increased by 1.4% and deposits by 4.9% from last year. During the nine months, the industry benefited from a 1.1% decline in loan interest rates and a 15% decline in deposit interest rates, which improved the banking sector's bottom line.

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FAQs

What is the current loan scenario in the UAE?

According to data from the UAE Central Bank, loans increased by 1.4% and deposits by 4.9% from the same time last year. During the nine-month period, the industry benefited from a 1.1% decline in loan interest rates and a 15% decline in deposit interest rates, which improved the banking sector's bottom line.

What is Dubai's GDP scenario regarding its real estate sector?

Dubai's real estate activity increased by 2.5% year over year, making up 9.1% of the emirate's GDP and adding 5% (0.23 percentage points) to the growth of the entire GDP. According to data from Dubai Land Department (DLD), the growth is the consequence of a 76% increase year over year in real estate sales during Jan-Sept., of this year.

Why was there a remarkable expansion in Dubai's tourism industry?

The efforts of the appropriate authorities and government bodies, who planned and implemented a jam-packed and dynamic schedule of events and activities to draw tourists, can be attributed to the remarkable performance and a strong resurgence in the tourism industry.

Why was there a rise in the percentage of tourists in Dubai?

Due to the loosening of travel restrictions in most nations around the world, Dubai's airlines had a 151 percent rise in the number of passengers that flew during the first 9 months of this year compared to 2021 (during the same period).

What is the current retail trade industry scenario in Dubai?

The Wholesale and Retail Trade industry saw growth of 1.6% over the corresponding period in 2021, reaching a value of AED74 billion. This activity was responsible for 24.1% of Dubai's nine-month GDP and 9% (more than 0.4 percentage points) of GDP growth in the emirate.

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