Dubai GDP growth forecast at 5pc
Dubai, November 26, 2013
Dubai is expected to outperform the UAE GDP with growth forecasts of four to five per cent, buoyed by strong performance of the core sectors of tourism, manufacturing and retail trade, said a report.
Business confidence in the UAE continues to rise amid positive economic conditions, with recent consensus forecasts for 2013 having set an annual GDP growth at around 3.5 per cent, said the CBRE Market View for November.
A positive result for the Expo 202 would mean new people, new visitors and new interest in Dubai, with international coverage and global exposure in what would be a PR event for the UAE and a springboard to establish Dubai as an internationally recognised global city.
According to reports and estimates, over $40 billion was spent by the Chinese government on developing and improving infrastructure in the build up to the 2010 Shanghai Expo, including six new metro lines, new roads, tunnels, bridges and a high speed rail link.
The quality of Dubai’s infrastructure has been extensively highlighted in recent months and has formed an integral thread throughout the bid message.
Dubai’s existing facilities would be upgraded and expanded on a successful bid, with the Dubai Metro Purple Line set to be fast tracked for completion, along with a host of other major projects, said the report.
This would have a direct and positive impact on UAE’s employment numbers, with additional workforce needed for major construction projects, while new companies would also be expected to set up operations to service other related Expo requirements, it said.
It would include development of real estate projects around Dubai World Central (DWC) and expansion of the Al Maktoum International Airport itself, accelerating its use as a new passenger hub and acting as a further catalyst to develop the airports transport and cargo infrastructure - a key driver for the emirates long term economic growth.
Furthermore, the importance of Jebel Ali port will also be increased tremendously. With its strategic proximity to the new airport, the port will act as a key corridor for transfer of goods from sea to the expo site, ultimately enhancing Dubai’s competitiveness as a global trade hub.
Real Estate Market
With political instability still prevailing in parts of the region and with economic conditions continuing to improve in the UAE, Dubai is seeing renewed growth, attracting an increasing number of international investors and occupiers alike.
The last edition of the Expo (2010) held in Shanghai attracted around 73 million visitors, a record for the event. However, according to Chinese Government figures the vast majority of visitors to the Expo event were Chinese nationals, with only roughly 6 per cent actually foreign tourists.
While this is still a significant number of visitors, it does suggest a need for caution in respect of Dubai’s future development plans which must remain anchored to actual supply and demand dynamics, rather than building just for a single event.
Hotel supply in the emirate has reached close to 60,000 keys with over 23,000 hotel apartments also operational. Last year Dubai attracted over 10 million, with hotel establishments recording an average occupancy rate of close to 80 per cent during 2012.
Dubai’s vision for tourism has set out plans to double annual visitor numbers to 20 million in 2020. The first nine months of 2013 have already seen around 7.9 million visitors, said the report.
While a Dubai Expo 2020 win would spur growth across virtually all asset classes, failure would also be far from disastrous, said the report.
The Dubai bid has already created global interest and generated positive press locally and internationally for the quality of the submission and for the huge strides that have been taken in the emirate’s recovery since 2008, it said.
However, a negative result could cause a short term dip in sentiment levels, specifically impacting the residential and land sectors which have both seen strong growth in prices over the last year as expectations levels have built up towards the announcement, it added. - TradeArabia News Service