Dubai's economy gets strong push

Dubai Dubai's economy grew 3.4 per cent in real terms in 2011, helped by strong trade flows and rising tourist numbers, the emirate's statistics office said Tuesday. Dubai saw its foreign trade jump by a record 22 per cent in 2011, driven by strong flows with Asia, while passenger traffic at its main airport rose 8 per cent to nearly 51 million. This year the number of passengers at Dubai International surged 14 per cent 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 per cent this year, the emirate's top official said in February.However, a weak housing market and sluggish bank lending, which have yet to recover from a property downturn 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 Dh306.2 billion from a revised Dh296.1 billion in 2010, the head of the statistics office said in a statement. The growth rate was in line with expectations. A statistics centre official told Reuters yesterday 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 per cent in 2010 with GDP in constant prices at Dh293.6 billion. 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 per cent, Arif Obaid Al Muhairi, executive director at the Dubai Statistics Centre 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 (IMF) estimated in April the UAE's 2011 GDP expansion at 4.9 per cent. 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 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.