Emirate's economy picking up with positive predictions for Q2 2019
The number of new business licenses issued in Dubai in the first four months of 2019 increased by 35 percent compared to the same period in 2018.
The Department of Economic Development (DED) issued 9,489 new licenses between January and April this year.
The Business Confidence Index in Dubai also climbed to 117.8 points in Q1 compared to 116.4 points during the first quarter of 2018, according to a DED survey.
Companies participating in the survey said they anticipated higher profits and selling prices in the second quarter of 2019, largely due to seasonal demand. The manufacturing sector was the most optimistic on volumes, profits and employment and overall, larger companies have stronger expectations for Q2 2019 compared to small and medium enterprises.
“The Department of Economic Development has already taken steps to implement the terms of the Charter, specifically to strengthen Dubai's position as a global business and investment destination," Sami Al Qamzi, Director General, DED said, adding that DED is currently finalising the project to establish the region’s first-of-its-kind virtual commercial city where licences will be granted without requiring residency in Dubai and in accordance with the highest international legal standards.
“The eight principles embody a pioneering vision for the future. The emphasis of the principles on launching modern projects that promote trade and civilisation and bring in new investment opportunities is beginning to bear fruit as evident in the number of new licenses issued by the Department of Economic Development and the accelerated growth in the emirate.”
Data from the Dubai FDI Monitor of the Dubai Investment and Development Agency (Dubai FDI) in DED indicated a total FDI inflow of AED 22.2 billion into Dubai as of the end of the first quarter of 2019 compared to AED7.3 billion during the same period of 2018.
The remarkable achievement comes at a time when Dubai moves closer to the Expo 2020, creating more opportunities for greater FDI inflows over the next three years as directed by Their Highnesses Sheikh Mohammed bin Rashid Al Maktoum and Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince and Chairman of the Executive Council of Dubai.
A framework for a Foreign Direct Investment Committee is being developed and DED, as a participant in the exercise, is developing a guide to implementing the new investment law, which will increase foreign ownership to 100 percent in specific sectors and fields to attract inward FDI.
Tourism in Dubai is another key sector that has continued to grow with a 2.2 percent increase seen in arrivals during Q1 2019 compared to Q1 2018.
The average occupancy rate of Dubai hotel rooms increased to 79 percent compared to 77 percent between Q1 2019 and Q1 2018. This is expected to witness further significant growth as the Expo 2020 draws closer.
Data from the Dubai Statistics Center indicates that the general inflation rate in Dubai declined for the first quarter of 2019 to -3.72 percent compared to a 2.27 percent increase during the same period of 2018, the year in which a 5 percent VAT was implemented leading to inflationary pressures despite declining costs of housing, water and transport.
Dubai is estimated to grow 2.1 percent in 2019 and 3.8 percent in 2020 driven by the Expo 2020, with direct benefits to the tourism, telecommunications, business, financial services, transportation, real estate and retail sectors.