Dubai's economy grew 3.3% in first nine months of last year

Emirate's accommodation and food services industry led growth with more than 11 per cent annual increase

A view of Dubai Marina. Dubai's transportation and storage services sector surged by almost 11 per cent in the first nine months of last year. AFP

Dubai’s economy expanded by an annual 3.3 per cent in the first nine months of last year, driven by growth in the emirate's tourism and transportation sectors, the latest government data shows.

Dubai's accommodation and food services industry recorded 11.1 per cent growth, while the transportation and storage services sector surged by 10.9 per cent, the Dubai Media Office said on Sunday.

“This success is the result of the harmonious collaboration between all of Dubai’s economic stakeholders, including its public and private sectors,” said Sheikh Hamdan bin Mohammed, Crown Prince of Dubai.

“It is also a reflection of Dubai’s favourable economic climate, robust world-class infrastructure, pro-business regulations and deep talent pool which together consistently draw in a diverse array of investors and entrepreneurs from all corners of the globe.”

Dubai, one of the main commercial, tourism and financial hubs of the Middle East, has maintained growth momentum since bouncing back from the pandemic-driven slowdown.

Dubai's GDP expanded by 3.2 per cent annually in the first half of last year to Dh223.8 billion ($60.9 billion), driven by growth in sectors such as transport, trade, financial services, accommodation and food services, property, information and communication, and manufacturing. according to official data released in October.

The transport and storage sector, which includes land, sea and air transport and logistics, contributed 13.1 per cent to Dubai's GDP in the first nine months of 2023, injecting Dh42.9 billion into the emirate's economy.

The accommodation and food services sector accounted for 3.4 per cent of the emirate's economy, making a value addition of Dh11.1 billion, according to the Media Office statement.

“Our success is also a result of the continuous, collaborative efforts between the public and private sectors. Together, we are working within a unified framework to realise the objectives of the Dubai Economic Agenda D33," said Helal Al Marri, director general of Dubai’s Department of Economy and Tourism.

"Our focus is not only on maintaining the current momentum but also on further strengthening an environment that enables businesses to thrive," Mr Al Marri said.

The Palm Jumeirah saw the majority of deals in luxury and super luxury sales in Dubai in 2023. AFP

At 450m, the Franck Muller Aeternitas tower will be one of the tallest in the city when complete in 2027. It will feature 649 one, two and three-bedroom apartments, plus duplexes, over 106 floors – all topped by a giant clock. Photo: London Gate

Bayz 101 by Danube will have 1,346 apartments and is the developer's largest project to date in terms of both units and overall space. Photo: Danube Properties

Sharjah property developer Arada has launched sales for its luxury project in Dubai, the Armani Beach Residences at Palm Jumeirah. Prices start at Dh21 million ($5.7m). Photo: Arada

Designed by Japanese Pritzker-Prize-winning architect Tadao Ando, in collaboration with fashion icon Giorgio Armani, Armani Beach Residences features 53 two to five-bedroom residences, plus penthouses and two presidential suites. Photo: Arada

One of the largest private penthouses in Dubai is on sale for Dh600 million. It comprises the three top-three levels and rooftop of Raffles The Palm Dubai Residences. Photo: Emerald Palace Group

Dubai's AHS Properties has launched a $850 million project called Casa Canal, located at Dubai Water Canal. Photo: AHS Properties

Casa Canal will have a mix of residences, including three-bedroom penthouses, four and five-bedroom villas and six-bedroom mansions. Units are priced between Dh22.5 million and Dh185 million and the project is set to be delivered in late 2025. Photo: AHS Properties

Nakheel, the developer behind The Palm Jumeirah, launched the first waterfront villa project on the Palm Jebel Ali in 2023. Leslie Pableo / The National

The launch of properties on four fronds of Palm Jebel Ali offer two types of homes – coral and beach villas, says Nakheel. Photo: Nakheel

Dubai developer Sankari Properties is building a $1 billion ultra-luxury project in Marasi Business Bay. Units will start at $10 million. Photo: Sankari Properties

Damac launched Cavalli Couture on Dubai Water Canal in 2022. The 14-storey building features 70 units, comprising three, four and five-bedroom duplex sky villas and duplex penthouses. Photo: Damac

Jumeirah Bay Island is one of Dubai's prime residential neighbourhoods. Photo: Bulgari

There were close to 50 sales of Jumeirah Bay Island properties in excess of $10 million in 2023.

Also much sought-after is The Mansions, Lanai Islands, Tilal Al Ghaf, Dubai. Photo: Knight Frank

A luxury villa in Dubai's Emirates Hills sold for Dh102.8 million in 2022. Photo: Phoenix Homes

Launched in January last year, D33 aims to double the size of Dubai’s economy, with a target of reaching Dh32 trillion by 2033 and establishing the emirate among the top three global cities.

The plan envisages a programme to support 30 private companies to achieve the so-called unicorn status ― company with valuation more than $1 billion. Other business incubators will support the growth of private companies, with 400 of the most promising identified.

The D33 agenda also aims to make Dubai a global digital economy leader, the fastest growing and most attractive global business centre, a centre for sustainability and economic diversification, and an incubator and enabler of talented citizens.

In the first nine months of last year, Dubai's information and communication technology industry grew 4.4 per cent annually to Dh15 billion.

The emirate's real estate sector recorded year-on-year growth of 4 per cent to Dh26.8 billion amid continued demand for both residential and investment opportunities, according to latest data.

Dubai's property has bounced back strongly from the coronavirus-induced slowdown, helped by government initiatives such as residency permits for retirees and remote workers.

The emirate's non-oil private sector grew robustly in December, with activity reaching its highest level in 16 months as new orders rose and cost pressures eased.

The seasonally adjusted S&P Global Dubai purchasing managers' index reading hit 57.7 last month, up from 56.8 in November and well above the neutral 50-point mark separating an expansion from a contraction.

The reading was the highest since August 2022 and the second highest in four-and-a-half years.

Emirates NBD expects Dubai's GDP to grow by 4 per cent this year, compared with a 3.3 per cent expansion in UAE's economy.

"The outlook over the coming months remains positive also, with new order growth at the highest level since mid-2019, boding well for the pipeline of activity through the start of 2024 at least," the Dubai lender said in a research note this month.

In October, the UAE Central Bank increased its 2024 growth forecast for the country's economy to 5.7 per cent, from 4.3 per cent previously, due to an expected rise in oil production.

However, it revised down its growth projections for 2023 to 3.1 per cent from 3.3 per cent, largely reflecting the extension of oil production cuts through the end of 2023, it said in its Quarterly Economic Review report.

"Dubai's economic performance is a clear reflection of the effective policies and initiatives that we have implemented as part of our long-term development roadmap," said Hadi Badri, chief executive of the Dubai Economic Development Corporation, Department of Economy and Tourism.

“We aim to solidify Dubai’s position as a top strategic priority for global business decision-makers in 2024," he added.