Tourism, retail expected to fuel Dubai’s economic growth in 2022
Dubai economy is expected to see sustained economic growth in 2022 supported by an expected uptick in business activity in the tourism and retail sectors, according to new analysis from Dubai Chamber.
The data insights, released during a business seminar titled The Road Ahead: UAE and Dubai Economic Outlook and Opportunities in Dubai Exports, pointed to a positive and robust recovery for the UAE economy over the next five years.
In 2022, the UAE economy is projected to record an estimated annual GDP growth rate of 3.4%, due to the expected recovery in domestic demand, recovery in international oil prices and the rebound in global demand for goods and services since mid-2020 onwards.
Expo 2020 Dubai and the adjustment to the Monday-Friday work week is expected to improve the prospects of UAE trade and business with the rest of the world in the short to medium term. Economic sectors that are expected to add momentum to the UAE’s economic recovery over the period 2022-2025, include transport and telecommunication, trade, hospitality and real estate and business services.
Other factors that will support this growth trend are: a strong recovery in public and private investment and strong export activity due to the rebound in the global trade given expected softening in the bottlenecks of the global supply chains, successful vaccination drive, a recovery in oil prices, accommodative monetary policy and improvement in consumers and business sentiment.
In addition, new measures adopted by the government to stimulate businesses and facilitate trade, such as reducing government fees and the cost of doing business, launching new strategies for trade and reforming investment and employment laws are expected to positively impact the economy in the short to medium term.
The data also revealed that Dubai exports and re-exports recovered in the first half of 2021, reaching pre-pandemic levels. The research has found that increasing the exports of newly diversified products will support further the growth of Dubai trade augmented by the pivotal expected role to be played by Dubai Industrial Strategy 2030 in product diversification of exports.
According to Dubai Chamber Macro Economic Model (DCMM), the entire UAE economy began to recover in 2021 by registering an estimated annual GDP growth rate of 3.1% and a 3.8% for GDP excluding the oil sector.