Efforts put in place to manage the repercussions of Covid-19 helped Dubai to limit the hit to its economy as more advanced countries registered a steeper drop in growth, according to Dubai Statistics Centre.
“The impact of the current worldwide crisis on Dubai in the first quarter of the year was less compared to some of the world's major economies,” the statistics centre said in a statement announcing gross domestic product figures.
Dubai's GDP contracted 3.5 per cent in the first quarter of 2020, compared to growth of 2.2 per cent last year, the statistics centre said. By comparison, GDP in the eurozone economies fell 3.8 per cent in the first quarter, and in the US the decline was 5 per cent, according to Commerce Department figures published last week.
"Dubai's economy witnessed healthy levels of growth in 2019. It was expected that in the first quarter of 2020, the economy will experience a decline due to the global impact of the Covid-19 pandemic,” Arif Al Muhairi, executive director of DSC, said.
“The worldwide restrictions on movement for individuals through air, sea, and land entry points, as well as the unprecedented intensification of precautionary measures, which limited the flow of freight across borders, had significant repercussions on international trade and the global economy.
“Being a central player in international trade and a vital global passenger transit hub, Dubai’s economy was affected by these exceptional circumstances,” he added.
However, Mr Al Muhairi said that the emirate had “successfully managed the global crisis and reduced its impact when contrasted with other economies”.
Dubai revealed a Dh1.5 billion stimulus package in March to offset the impact of coronavirus on its economy. The government waived 2.5 per cent market fees, refunded customs fees on imported items and offered a 10 per cent discount on utilities for its residents and citizens.
The emirate also pledged to support its airline Emirates with an equity injection to help it ride out the Covid-19 crisis.
Dubai has now gradually reopened its economy and eased movement restrictions, which have in turn helped economic recovery. DSC said that sectors such as real estate, finance and manufacturing retained their growth momentum in the first quarter.
While trading activity declined 7.5 per cent in the first quarter, Mr Al Muhairi said it remained the largest contributor to the emirate’s economy, accounting for 23 per cent of total GDP.