Dubai Economic Council’s report “Dubai Economic Outlook, Q2, 2013”

The report "Dubai Economic Outlook (DEO), Quarter 2/ 2013" issued by the Secretariat General of the Dubai Economic Council (DEC) points that the Q2 of this year is a reflection of momentum witnessed by Dubai's economy during the Q1 2013. Most of macroeconomic and sectoral indicators seen growth that exceeded those in the Q1 of this year and last year.

The report estimated the growth rate of real gross domestic product (GDP) to Dubai in the Q2 of 2013 by 4.7 % compared to the corresponding 2012 quarter. The report attributed this growth to the growth of the four sectors, namely: wholesale and retail, transportation, manufacturing, and real estate. 

Lower budget deficit
The public budget deficit decreased from 1.8 billion dirhams in 2012 to 1.5 billion dirhams in 2013 as a result of higher revenues by about 7.2% from about 30.4 billion dirhams to 32.6 billion dirhams, increased government expenditure by about 5.8% from 32.3 billion dirhams to 34.1 billion dirhams between 2012-2013. As a percentage of GDP, the budget deficit has dropped from about 0.6 % in 2012 to less than 0.05%.

Current expenditure accounts for three-quarters of expenses
As for the economic structure of expenditures, it has been observed that about three-quarters of expenditure allocated for the current spending in 2013, while the share of development expenditure increased to about 24% this year. The public revenues dominated by non-tax revenue. 

A striking recovery in the real estate sector
The report indicates that the real estate sector in Dubai has witnessed a new wave of growth during the Q2 of 2013 in terms of both value and number of apartments. the Dubai Marina area ranks first in the number and value of transactions the largest transaction in the sector are made by Indians, British, Emarati, Pakistani, Iranians, and Russians. Indians captured the largest purchase deals (27%), followed by British (17%), and Pakistani (15%).

The tourism sector continues to grow
The report states that the tourism sector in Dubai has continued its outstanding performance complement the Q2 of this year exceeded levels the same period of last year.

5 million tourists in Dubai during the first half of 2013
The number of guests hotel establishments and tourism in Dubai during the first half of 2013 to more than 5 million guest from various countries around the world, especially Saudi Arabia, which has increased the number of visitors to Dubai at a rate of about 32%, while the rest of the main exporters of tourists to the emirate are the UK, USA, Russia, Germany and the GCC countries, in addition to China and Iran

DTCM.. an engine of tourism growth
The report points out that considerable efforts made by the Department of Tourism and Commercial Marketing (DTCM) attracting tourists from different countries through the organization of programs and events and promotional campaigns have contributed- along with other factors such as modern infrastructure and development services- to make the emirate classified tourist interface regionally and globally.The number of hotel guests during the Q2 of 2013 to reach 2.12 million

Dubai to overcome the seasonal impact of tourism
The report confirms that the successive positive developments witnessed by Dubai's tourism sector has enabled the emirate to overcome the seasonal effect which is usually seen muted in tourism as a result of rising temperatures and a large number of travel out of the state population.

High hotel occupancy rate
The report pointed out that the hotel occupancy rate in Dubai arrived at 80% during the Q2 2013 versus 76% during Q2 2012.

Dubai's trade grew by 16% during the first half of 2013
The value of Dubai’s foreign trade in the first half of 2013 to achieve a new record level reached 679 billion dirhams, compared to AED 584 billion in the same period of 2012, a growth of 16%. The emirate's exports (including re-exports) 272 billion dirhams, an increase of 16% from the same period last year. Imports also rose to a record 406 billion dirhams, compared with 349 for the same period of last year.

Imports constitute the largest share of the total value of foreign trade of Dubai (about 60%) in the first half of 2013, while exports account for 12% and re-exports 28%. And occupied the first place gold within the goods imported by Dubai during the first half of 2013 with a share of 20 % of total imports , followed by telephones for cellular and wired communications networks (10%), followed by diamonds (7%).

India, China and the USA, the most important trade partners of Dubai
The report stated that India is the largest trading partner of Dubai, where trade between them amounted to between 81 billion dirhams; China comes in second place (63 billion dirhams), then the USA in third place (45 billion dirhams). In fourth place comes the UK (30 billion dirhams).

Growth in the financial sector
The Q2 of 2013 saw a growth of deposits and loans in Dubai’s banks. The growth rate of deposit was 0.4% and for loans increased by 4.9% compared to the previous quarter. The report confirms that the increase mentioned has led to a rise in loan-to-deposit ratio, which amounted to 90% more than its counterpart with the Q1 of this year.

Improve the performance of banks reflects the vitality of overall economic activity
In this context, the report points to the good performance of the major banks as well as the dynamics of overall economic activity in the emirate in the UAE was behind the improved performance of the banking sector. The report confirms that expectations on indicators remain positive given the constant growth and low inflation rate during the first half of 2013. The same is true on the movement of lending, which is expected to report continued growth in the coming period, especially in light of the growing levels of domestic demand and investment.

An increase in the banks' profits
The Q2 of 2013 saw a growth in Dubai’s bank profits in compared to the Q1 of the same year. The increase in quarterly earnings by about 16%.
Personal loans accounted for the lion's share of the total loans, followed by manufacturing, and trade
As for the distribution of loans in Dubai, the report revealed an increase in the share of personal loans from 29.9% in the Q1 of 2013 to 30.7% in the Q2 of the same year. The manufacturing sector saw a rise in its share from 4.1% to 6%. The share of the trade sector has recorded a slight increase from 14.1% at the beginning of 2013 to 14.2% by the end of June 2013.

Height of the Dubai Financial Market (DFM) index by 22%
Stock markets in the UAE witnessed a remarkable state up in the indicators in the Q2 of 2013 compared with the Q1 of the same year. The Dubai Financial Market (DFM) index increased significantly at the end of the Q2 2013, which amounted to about 21.5%, compared with the previous quarter, and achieved 2222.57 points at the end of June 2013 compared to 1829.24 points at the end of March 2013.
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Shares of real estate and construction sector is leading the market
In terms of sectoral performance, real estate and construction sector still considered the most important element in the performance of the DFM indicator.

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