Dubai limits virus impact on economy
Fares better than major economies as GDP dips 3.5%, less than IMF forecast
The impact of the crisis on Dubai in the first quarter was less compared to some of the world’s major economies, according to the figures released by the Dubai Statistics Centre yesterday.
Dubai’s GDP (gross domestic product) recorded a 3.5 per cent dip in the first three months of the year. The International Monetary Fund (IMF) projected a 4.9 per cent decline in the global economy this year.
So, the impact of the crisis on Dubai in the first quarter was “less compared to some of the world’s major economies”, the Dubai Statistics Centre said
Arif Al Muhairi, Executive Director of DSC, said: “It was expected that in the first quarter of 2020 the economy will experience a decline due to the global impact of the Covid-19 pandemic. “Being a central player in international trade and a vital global passenger transit hub, Dubai’s economy was affected by these exceptional circumstances.
“The worldwide restrictions on movement for individuals through air, sea, and land entry points, as well as the unprecedented intensification of precautionary measures, had significant repercussions on international trade and the global economy.”
Dubai’s GDP (gross domestic product) recorded a 3.5 per cent dip in the first three months of the year, just as the economy started showing the first signs of the Covid-19 pandemic.
Even then, the impact of the crisis on Dubai in the first quarter was “less compared to some of the world’s major economies”, the Dubai Statistics Centre states.
The trade and transport sectors felt the brunt of the first quarter 2020 slowdown, as did tradefacing warehousing and logistics. Trading activity contracted 7.5 per cent in the first quarter — but retained its “status as the largest contributor to the economy, with 23 per cent of GDP.
A gain for the government
Transport and logistics were down 5.5 per cent, but still contributed 12.1 per cent of GDP.
“While the sector benefited from the significant decline in operating costs, such as aviation fuel cost, the decline was not enough to make up for the dip in revenues,” the statement added. Last year, Dubai’s 2019 GDP growth was led by trading, which was up 2.7 per cent. It contributed 26.6 per cent of GDP
Interestingly, the public sector eked out a 0.6 per cent growth in the first three months over first quarter 2019. It now makes up 5.1 per cent of the broader economy.
“The role played by the public sector was significant in mitigating the impact of the global economic crisis experienced in Q1-2020,” the government said in the statement.
The health care sector, which was at the very centre of affairs, actually declined 3.7 per cent between January to end March, “due to the need to allocate the majority of health resources to combating the pandemic.
Shoppers at Mall Of The Emirates in Dubai.