Retail boosts Dubai private sector growth

dubai — Overall business conditions across Dubai’s private sector economy further improved in February, underpinned by sharp rises in output and incoming new work, with the growth of the latter picking up to a 24-month high, Emirates NBD’s Dubai Economy Tracker reported.

At 56.2 in February, the seasonally adjusted Emirates NBD Dubai Economy Tracker Index — a composite indicator designed to give an accurate overview of operating conditions in the non-oil private sector economy — registered above the crucial 50.0 threshold for the 12th month in succession. The latest reading was down from January’s 23-month high of 57.1, but was above the series average of 55.1.

A reading of below 50.0 indicates that the non-oil private sector economy is generally declining; above 50.0, that it is generally expanding. A reading of 50.0 signals no change.

Wholesale and retail was the best-performing category for the first time in six months at 58.3 in the index, followed by travel and tourism at 57.0 in the index.

Meanwhile, construction companies recorded a slowdown in growth momentum during February, with the headline index down to 53.3, from 55.4 at the start of the year.

Khatija Haque, head of Mena research at Emirates NBD, said: “The February Dubai Economy Tracker survey continues to show robust expansion in Dubai’s non-oil private sector. Strong growth in output and new orders, which points to solid GDP growth in the first quarter of 2017, is not being reflected in higher employment however, and competition continues to weigh on selling prices.”

The overall improvement in the health of Dubai’s private sector reflected another sharp upturn in business activity in February. The rate of output growth was stronger than the long-run series average, but eased from January’s 23-month high to its weakest in three months. Furthermore, all three key sub-sectors noted sharp increases in activity during February, led by wholesale and retail. Anecdotal evidence generally linked higher business activity to stronger underlying demand conditions. Dubai’s private sector employment was broadly unchanged in February, thereby ending a seven-month sequence of job creation.

New work received by private sector companies in Dubai continued to rise in February. Additionally, the latest increase quickened to the sharpest since February 2015. A number of firms cited stronger market demand, supported by successful marketing and promotional strategies.

— business@khaleejtimes.com