Dubai’s economy grows 3.2% in first quarter on non-oil sector boost

Emirate added $31.3bn to its GDP during the period, with transport and financial sectors expanding

Dubai's economy posted 3.3 per cent growth last year as its non-oil sectors expanded. Bloomberg

Dubai’s economy grew by 3.2 per cent annually in the first quarter of 2024, with Dh115 billion ($31.3 billion) added to the emirate’s gross domestic product during the period, driven by the expansion of the transport and storage sector, as well as the financial and insurance industry.

The growth continues the momentum from last year, when the emirate's economy grew by 3.3 per cent annually to Dh429 billion, the government said on Tuesday.

“Dubai is progressing in accordance with a clear vision … what we witness today is a practical reflection of this vision, which has placed Dubai among the leading economic and commercial centres of the world,” Sheikh Hamdan bin Mohammed, Crown Prince of Dubai, said.

The transport and storage sector and the financial and insurance industry recorded growth rates of 5.6 per cent each, while the information and communications sector expanded by 3.9 per cent in the first quarter.

The accommodation and food services sector grew by 3.8 per cent, the real estate sector by 3.7 per cent and the trade sector by 3 per cent.

The latest data comes as Dubai aims to double the size of its economy to Dh32 trillion over the next decade and establish the emirate among the top three global cities as part of its D33 strategy.

The plan aims to support 30 private companies in their push to become unicorns – start-ups worth more than $1 billion.

Other business incubators will support the growth of private companies, with 400 of the most promising identified.

D33 also aims to make Dubai a global digital economy leader, the fastest-growing and most attractive global business centre, a centre for sustainability and economic diversification, and an incubator for talented Emiratis.

“With high-impact initiatives such as the foreign direct investment development programme to attract selective investments aligned with the D33 agenda and the implementation of the Dubai Economic Model to monitor the city’s advancement, we are poised to further energise our growth initiatives,” said Helal Almarri, director general of Dubai's Department of Economy and Tourism.

“These measures will enhance collaboration between public and private sector stakeholders.”

In terms of industries, the wholesale and retail trade was the largest contributor to GDP, accounting for 22.9 per cent in the first quarter, the Dubai government said.

The transport and storage sector, which includes land, sea and air transport and logistics, contributed 13.4 per cent to the emirate's GDP during the first quarter.

The sector's performance “was bolstered by increased demand for national carriers' services, highlighted by a 6.8 per cent increase in the number of passengers through the first quarter”, the emirate's government said.

Dubai welcomed 5.2 million international visitors during the first quarter of 2024, an increase of 11 per cent from the same period in 2023, with Dubai hotels maintaining average occupancy levels of 83 per cent during the period, the latest data shows.

Meanwhile, the financial sector contributed 13.1 per cent to the emirate’s economy in the first quarter.

At the end of the first quarter of 2024, there was an 8 per cent annual increase in credit balances and a 15.2 per cent growth in deposit balances, according to the UAE Central Bank.

The real estate sector, which continues to grow on the back of higher demand from property buyers and the launch of new projects, contributed 7.3 per cent to the emirate's economy.