Dubai maintains growth surge to reach $30.3bn GDP for first quarter

The growth in Q1 2023 is significantly higher than that of some of the most developed countries in the world. Data issued by the Organisation for Economic Cooperation and Development (OECD) indicate a seasonally adjusted growth of 1.6 percent for OECD countries. The European Union grew by 1.1 percent, while the US economy grew by 1.8 percent.

Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of The Executive Council, said: “The continued high growth in the first quarter of the year is yet another testament to Dubai’s strong fundamentals, sustainability and resilience and its capacity to constantly create fresh pathways for enterprise and innovation to flourish.

“The introduction of the Dubai Economic Agenda D33, which seeks to double the size of the emirate’s economy over the next decade and consolidate its status as one of the world’s top three cities, has created a strategic springboard to usher in a new cycle of growth and value creation.

“Powered by the harmonious partnership between the public and private sectors, Dubai will continue to raise its role in shaping the future of the global economy.”

According to data issued by the Dubai Data and Statistics Establishment of the Dubai Digital Authority, the transportation and storage sector was the biggest contributor to overall growth at 48 percent, followed by the financial and insurance sector at 15 percent. Trade was third at 10 percent but remained the biggest contributor to the economy at 22.9 percent.

Hamad Obaid Al Mansoori, Director General of the Dubai Digital Authority, said: “At Digital Dubai, we will continue to work in cooperation with other government entities to ensure the sustainability of the city’s economic momentum by providing a strong digital infrastructure and the highest standards of cybersecurity, in addition to seamless access to open data, all of which will enhance the investment climate and build an environment that supports growth and prosperity.”

Dubai economy thrives: Key sectors’ growth

The Dubai Digital Authority report revealed that wholesale and retail trade continued to be the largest contributor to the economy, accounting for 22.9 percent of the GDP, followed by the transportation sector (14.1 percent).

The trade sector recorded a 1.2 percent growth YoY in the first quarter of 2023, bringing an added value of AED25.5 billion ($6.94 billion). The sector accounted for 22.9 percent of the economy and contributed 10 percent of overall recorded Q1 2023 growth.

In terms of growth, transportation and storage outperformed all other sectors. Growing to 10.3 percent of the economy in Q1 2023, it contributed 48 percent to the overall recorded first quarter growth, bringing AED15.6 billion ($4.25 billion) in added value.

Air transport accounted for the largest proportion of the transport and storage sector and was positively impacted by the increase in the demand for the services of Emirates, which recorded 68 percent growth in passenger numbers in Q1 2023.

The accommodation and food services sector reported a 5.6 percent growth, with an added value of approximately AED4.5 billion ($1.23 billion). The sector contributed 4.1 percent to the economy and 8 percent to overall recorded growth. Dubai welcomed 4.67 million international visitors, a 18 percent increase from the 3.97 million during the same period in 2022.

The report also revealed a 2.4 percent growth in real estate activities, contributing 7.4 percent to the economy as per Dubai Land Department figures, driven by the growth in margins on property sales.

The financial sector grew by 3.2 percent, contributing 12.7 percent to the GDP. Data from the UAE Central Bank indicated a 3.5 percent growth in credit balances and a 14.9 percent growth in deposit balances compared to the same period last year.

Other economic sectors experienced a growth rate of 1.5 percent and contributed a combined 35.5 percent to the economy.