DUBAI - Dubai’s real gross domestic product (GDP), which surged to a record Dh198 billion in 2007, is predicted to sustain an average growth rate of 11 per cent for the next eight years.
The main driver of this remarkable growth - outpacing the average growth rate forecast for the GCC - will be the non-oil sector, growing at a spectacular pace.
According to Hisham Abdullah Al Shirawi, Second Vice-Chairman, Dubai Chamber of Commerce and Industry, the key sectors fuelling the growth include tourism, retail, infrastructure, knowledge industry, transportation, logistics, manufacturing, professional and government services. He said Dubai’s GDP growth was higher than other Gulf countries and major global economies even in 2005. After growing at an average of around 8.5 per cent in 2003, 5.9 per cent in 2004, 6.8 per cent in 2005, and 6 per cent in 2006, GCC’s GDP growth averaged at 5.0 per cent in 2007. In 2020, the nominal GDP of GCC is projected to soar three-fold from $773 billion to roughly $2.3 trillion in 2020 at an average oil price of $70 per barrel, according to McKinsey & Company Middle East.
In contrast, the overall real GDP of the UAE is poised to record a slower growth rate of 6.4 per cent in 2008 and 6.1 per cent in 2009 compared to an eight per cent surge in 2007, economists said. However, nominal GDP -measured on the basis of current prices - will record almost the same growth trend as in 2007 at 15.7 per cent. Economists forecast that UAE’s nominal GDP will hit Dh805 billion and Dh960 billion in 2008- respectively up 6.4 per cent and 6.1 per cent in real terms and 15.7 per cent and 19.1 per cent in nominal terms.
Al Shirawi said Dubai’s non-oil foreign trade that surged 33 per cent to $185 billion in 2007 from $139 billion in 2006, also was poised for a sustained growth. In a presentation about Dubai’s remarkable growth at a two-day business convention yesterday, he highlighted Dubai’s ambitious economic targets under the strategic plan 2015.
He said the hospitality industry is expecting a real boom with its target of 100,000 rooms for 15 million visitors by the year 2015. Currently, there are 324 hotels, 33,731 rooms with occupancy rate of more than 85pc throughout the year as a total of seven million people used Dubai hotels in 2007 compared to 1.9m in 1996. Geared up for the air traffic boom is Dubai International Airport, which handled an average of 725 flights per day compared to 650 flights in 2006, reflecting a 10 per cent growth during 2007. Connected to 205 destinations through a network of 120
international airlines, the airport serviced 34 million passengers in 2007 thus recording a 19 per cent rise and is expecting 40 million passengers this year.
In 2007, Dubai’s non-oil exports surged a record 43 per cent in 2007 to Dh167.9 billion from Dh117.4 billion on the back of a remarkable increase in trade with Iran, Saudi Arabia and Qatar.
The jump in total exports, including re-exports, underscored the buoyant economic growth of the emirate. Dubai’s exports have been growing by an average of more than 28 per cent annually during the past five years. In 2006, Dubai’s non-oil foreign trade grew 9.15 per cent to Dh523.5 billion compared with Dh479.6 billion in 2005 - the highest non-oil trade in the Arabian Gulf. Dubai’s non-oil foreign trade represents about 80 per cent of the UAE’s total trade. Dubai’s imports have also increased by 15.5 per cent, from Dh190.4 billion in 2005 to Dh219.8 billion in 2006.