Sheikh Hamdan hails Dubai’s economic growth of 3.2% in first half of 2023

Dubai's Crown Prince has hailed the emirate's strong performance in the first half of 2023.

Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of The Executive Council of Dubai highlighted Dubai's growth of 3.2 per cent in H1 2023, compared to the same period last year, with the economy’s total value reaching Dh223.8 billion.

“The economic expansion is consistent with the goals of the Dubai Economic Agenda D33 to double GDP growth over the next decade and consolidate the emirate’s position as one of the world’s top three urban economies,” said Sheikh Hamdan, noting that this economic growth is an outcome of the vision of Dubai's Ruler who always invests in people and creates the conditions to ensure continuous development of Dubai’s investment environment.

Several sectors contributed to the emirate’s positive economic performance. Sectors like transportation, wholesale and retail trade, financial and insurance, accommodation and food services, real estate, information and communication and manufacturing saw remarkable growth of their own, contributing to overall excellence.

These sectors collectively contributed to approximately 93.9 per cent of H1 growth, with the transportation and storage sector leading with 42.8 per cent, followed by trade at 12.9 per cent, and the financial and insurance activities sector at 9.9 per cent, according to figures released by the Dubai Data and Statistics Establishment, one of the entities under the Digital Dubai umbrella. The exceptional performance was driven by a 3.6 per cent growth in real GDP in Q2 2023.

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Helal Saeed Almarri, Director General of Dubai’s Department of Economy and Tourism, commented: “With this sustained economic growth, we are seeing actionable momentum as a direct result of the coordinated city-wide delivery of the Dubai Economic Agenda, D33, in line with the vision of the Vice President of the UAE.

“We are committed to the acceleration of all projects under D33 and the crystallisation of these critical economic levers, so we can continue to build the enabling ecosystem and regulatory framework for sustainable economic development, enhanced global attractiveness and a hyper-connected network for both increased expansion and inbound investment.”

Hamad Obaid Al Mansoori, Director General of Digital Dubai, commented on the results, stating that “the growth achieved in the first half of 2023 reflects the overall performance of Dubai’s economic ecosystem, which, in turn, aligns with the government’s efforts to create favourable conditions for investment, enhance business competitiveness, increase foreign trade and promote digital transformation in the emirate’s economy.”

“Dubai has cemented its reputation as a world-leading city, as well as a role model that millions aspire to and strive to emulate,” he asserted. “As our remarkable economic growth continues to exceed expectations, the emirate’s model is reinforced as a promising prototype and clear embodiment of the economies of the future.”

Younus Al Nasser, Chief Executive, Dubai Data and Statistics Establishment, Digital Dubai, said: “The economic growth we have seen across various sectors and activities reflects the resilience of the emirate’s economy and its commitment to achieving its economic targets outlined in the Dubai Economic Agenda D33. The Dubai Government’s efforts and the exceptional empowerment it gives to the Dubai economy, including governance, legislative integration, comprehensive infrastructure, competitive logistics services, and exemplary agility, all make the emirate’s economy the most adaptive and fastest to recover.”

Hadi Badri, CEO of Dubai Economic Development Corporation, Dubai Department of Economy and Tourism (DET), said: “The strategic vision of Dubai’s leadership coupled with the collaborative spirit of the government and private sectors, continue to be the driving force for Dubai’s buoyant economic growth. We continue to focus on the strategic initiatives under D33 to prioritise their delivery, in tandem to building out an even more comprehensive roadmap of projects, economic unlocks and critical enablers for sustainable growth across all key sectors.”

1.7% growth in trade activity

Trade activities achieved an added value of Dh53.6 billion in H1 2023, growing by 1.7 per cent compared to the same period in 2022, and contributing 23.9 per cent of the GDP and 12.9 per cent of total growth. Trade activities are vital for Dubai’s economy and for the wider region, as they effectively contribute to sustainability and economic prosperity.

10.5% growth in the transportation and logistics sector

Transportation and logistics outperformed all other sectors with a significant growth of 10.5 per cent in H1 2023, compared to the same period last year. The sector contributed 42.8 per cent to the overall recorded first half growth, generating Dh31.4 billion in added value. The sector includes activities related to land and air transport for individuals and goods, maritime transport, handling and storage, postal services, and related supporting activities.

Air transport accounts for the largest proportion of the transport and storage sector given its sizeable volume. The sub-sector’s performance was positively impacted by the increase in the demand for the services of national carriers, which recorded 56 per cent growth in passenger numbers in the first half of 2023, compared to the same period last year.

9.2% growth in hotels and restaurants sector

The hotel and food services sector reported a 9.2 per cent growth rate in the first half of 2023, with an added value of about Dh7.9 billion. The sector contributed 3.5 per cent to the economy and 9.5 per cent to overall growth The emirate welcomed 8.55 million international visitors with 20 per cent growth, compared to the same period last year, exceeding the number recorded prior to Covid-19, when the city welcomed 8.36 million international visitors in the first half of 2019, according to figures from Dubai’s Department of Economy and Tourism.

3.6% growth in real estate activity

A report published by Digital Dubai’s Dubai Data and Statistics Establishment showed that real estate activity grew by 3.6 per cent, contributing by 8.2 per cent to the overall economy and 9.2 per cent to total growth. This was driven by growth in real estate sales in the first half of this year, according to data from the Dubai Land Department.

2.7% growth of the financial sector

Financial and insurance activities achieved a growth of 2.7 per cent during the first half of 2023, contributing 11.9 per cent to the GDP, with an added value of Dh26.6 billion, in addition to contributing 9.9 per cent to the total growth. UAE Central Bank data indicate that the volume of credit and deposits grew by an average of 9 per cent compared to the same period of the previous year.

3.8% growth of the information and communications sector

Information and communications activity recorded a 3.8 per cent growth in the first half of 2023, compared to the same period in 2022, achieving an added value of Dh9.6 billion and contributing 5 per cent of the total growth.

Meanwhile, other economic sectors achieved growth of 0.7 per cent during the first half of 2023, and together contributed a combined 6.1 per cent of the total growth.

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