DUBAI (AFP) – The construction and real estate sectors in Dubai have registered a near five percent fall in 2010, a top Dubai government official told AFP on Monday of the sector hit hard by the financial crisis.
“I believe that all the main sectors have registered varying proportions of growth (in 2010), except property and construction which saw a five percent drop,” Sami al-Qamzi, director general of the Dubai department of economic development, told AFP.
Growth in the construction sector is based on supply and demand, thus “its recovery will take a longer time,” added Qamzi, who was speaking on the sidelines of the Global Agenda Summit in Dubai.
The world debt crisis has exacerbated economic woes in Dubai as its real estate sector plummeted when international finance dried up.
Property sale prices in the emirate are estimated to have more than halved in value since peaking in 2008.
Dubai has managed its debt crisis thanks to a 20-billion-dollar lifeline from the Abu Dhabi-based central bank and the neighbouring emirate’s government.
Officials, including Qamzi, are now sounding upbeat about the economy’s prospects. The emirate’s growth has exceeded expectations, he said.
“The World Bank had projected a 0.5 percent growth and even we projected a one to 1.5 percent growth, but the numbers published by the statistics centre for this year’s first half point to 2.2 percent,” Qamzi said.
The Dubai statistics centre said last month it expected GDP to grow by 2.3 percent this year, way above a 0.5 percent growth forecast by the International Monetary Fund, which had said GDP contracted by 1.3 percent in 2009.
The growth is propped by a healthy recovery in trade, logistics and tourism.
More than 600 participants are attending the three-day Global Agenda Summit organised by the World Economic Forum that opened on Monday.