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Dubai’s economy grew 3.4 pct in 2011 | ASHARQ AL-AWSAT English Archive 2005 -2017
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DUBAI, (Reuters) – Dubai’s economy grew 3.4 percent in real terms in 2011, helped by strong trade flows and rising tourist numbers, the emirate’s statistics office said on Tuesday.

One of seven United Arab Emirates, which have been recovering from the 2009-2010 debt crisis, Dubai saw its foreign trade jump by a record 22 percent in 2011, driven by strong flows with Asia, while passenger traffic at its main airport rose 8 percent to nearly 51 million.

This year the number of passengers at Dubai International surged 14 percent to 18.8 million in January-April from the same period a year ago. Cargo volumes have been rising in low single digits and the emirate, which makes up nearly a third of the UAE’s GDP, is aiming for economic growth of 4.5 percent this year, the coastal desert emirate’s top official said in February.

However, a weak housing market and sluggish bank lending, which have yet to recover from a property crash in late 2008, and international sanctions against Iran are expected to weigh on Dubai’s economy this year.

Last year Dubai’s gross domestic product rose to an estimated 306.2 billion dirhams ($83.4 billion) from a revised 296.1 billion in 2010, the head of the statistics office said in a statement. The growth rate was in line with expectations.

A statistics center official told Reuters on Tuesday that a comparable growth rate for 2010 was not yet available as the office has been revising data from the previous years. It plans to release revised figures in coming weeks.

The office had originally reported a growth rate of 2.8 percent in 2010 with GDP in constant prices at 293.6 billion dirhams.

Wholesale, retail trade and repair services, which account for around a third of Dubai’s GDP, provided the biggest growth impetus to the economy last year, rising by 5.8 percent, Arif Obaid al-Muhairi, Executive Director at Dubai Statistics Center said in the statement posted on the statistics office’s website.

The UAE, one of the world’s top five oil exporters, has yet to release its 2011 GDP data. The International Monetary Fund estimated in April the UAE’s 2011 GDP expansion at 4.9 percent.

The recent tightening of sanctions against Iran should have a moderate impact on the economic growth of the UAE, its major trading partner, the IMF said in May.

Sanctions against Iran over its disputed nuclear programme which have been in place since June 2010 have so far not led to a lasting reduction in Dubai’s trade with Tehran, the IMF said, adding a 30 percent reduction in exports to Iran would reduce the UAE’s GDP growth by 0.3 percentage points.

With the exception of Dubai, the regional trade and business hub, Gulf Arab trade links with Iran are minor. Apart from trade, Iran has also been a significant source of demand for real estate, tourism and financial services in the UAE.