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KT edit: Tough road ahead

Dubai's non-oil sector will continue to recover in coming months but the outlook remains highly uncertain with the number of coronavirus cases rising globally

The steps taken early on by the Dubai government to open the economy, ease movement and travel restrictions and introduce measures to support growth activity are helping the non-oil sector shrug off incipient coronavirus-induced slackness. The health of the non-oil sector is visibly improving as indicated by the Purchasing Managers' Index (PMI) readings, which have been above 50 for three consecutive months. Now this index is among the most closely watched economic indicators the world over to gauge the health of an economy. The results are based on polling the people who sit at the centre of a company's supply chains, which gives us a near-instantaneous insight of the demand and supply of products and services unlike GDP data that comes with a time lag of at least four to five weeks. 
However, to think that we are out of the woods already will be premature. The non-oil sector will continue to recover in coming months but the outlook remains highly uncertain with the number of coronavirus cases rising globally. It is leading some countries, including the UK and parts of Europe, to re-impose restrictions on people's movement and some businesses, especially those in the hospitality sector, which could have an impact here too. Economists expect a contraction in the overall GDP of the UAE for this year. Even if there is a rebound in the third and fourth quarter, it is unlikely to fully offset the contraction registered in the first half of the year. It is going to be a tough ride, but we will persevere.