Coronavirus Pandemic

Covid-19: Dubai tells government agencies to cut spending, freeze hiring

Filed on April 9, 2020
Dubai, spending, freeze hiring, coronavirus outbreak

(Photo: Shihab/KT)

The department of finance told all government agencies to postpone all construction projects that have not begun.

Dubai's department of finance has told all government agencies to slash capital spending by at least half and halt new hiring until further notice, in response to the coronavirus outbreak, according to an official document seen by Reuters.

Dubai has been hit by the outbreak, as measures aimed at containing the spread of the virus have brought vital economic sectors such as tourism and transport to a near halt.

The department of finance told all government agencies on Wednesday to postpone all construction projects that have not begun until further notice and not to allow any cost increases for ongoing construction projects.

It asked them to cut administrative and general expenses by at least 20 per cent, to review the budget for existing construction projects and postpone any new projects that have not begun yet. It also asked to freeze any spending increases for ongoing construction projects, the document said.

The economic slowdown in Dubai could wipe 5 per cent to 6 per cent off its GDP this year and could even force the emirate to seek a bailout similar to the one extended by oil-rich Abu Dhabi after a 2009 financial crisis, analysts and sources have said.

Dubai's non-oil private sector has also been hit hard, with firms shedding jobs to minimise their losses, particularly in the travel and tourism sector, a business survey showed on Thursday. 

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