Dubai’s private business sees 'solid rebound' on strong tourism

Dubai’s private sector recorded its strongest growth in five months amid a strong performance by the travel and tourism as well as wholesale, retail and construction sectors.

The Emirates NBD Dubai Economy Tracker Index posted at 52.5 in March, up from 48.9 in February. A score higher than 50 signals expansion in the economy.

The Dubai Financial Market index, a barometer of business health and sentiment, has witnessed significant gains over the past three months.

The DFM index closed yesterday at 3,433.69, up 32.5 per cent since hitting an intra-day low of 2,590.72 on January 21, 2016.

In addition, the price of oil too has seen a significant rise since hitting 13-year-lows of under $27 in late January. A barrel of Brent crude is currently trading at above $42.

The reading comes amid an overall improvement in economic conditions and a sustained rise in oil prices since mid-January this year.

The seasonally adjusted Emirates NBD Dubai Economy Tracker Index report maintains that the latest reading points to the fastest improvement in business conditions since November 2015, largely reflecting renewed output and new order growth alongside a slight acceleration in staff hiring.

A return to growth was recorded across all three key sub-sectors monitored by the survey in March, it notes.

Survey respondents were much more upbeat about the business outlook in March, the report said.

Around one-third of the survey panel anticipate an upturn in business activity, while only 4 per cent forecast a fall over the year ahead.

As a result, it added, business confidence was the highest since September 2015, with firms pointing to hopes of an improvement in underlying economic conditions.

Among sectors, travel & tourism was the strongest performing category of activity, followed by wholesale & retail and construction.

The survey covers the Dubai non-oil private sector economy, with additional sector data published for travel & tourism, wholesale & retail and construction.

“The Emirates NBD Dubai Economy Tracker survey for March suggests that after a slow and uncertain start to 2016, activity appears to have picked up at the end of Q1. Output and new order growth across key sectors were solid in March and firms were more optimistic about prospects for the coming year,” said Khatija Haque, Head of Mena Research at Emirates NBD.

New jobs created as business activity expands

The index says job-creation was maintained across the private sector in March, thereby continuing the current period of expansion that began at the start of 2012.

The latest upturn in employment numbers was the fastest since November 2015, it says. This was on the back of a rebound in overall business activity thanks to launch of new projects and a recovery in clients’ willingness to spend, it said.

A number of firms cited stronger than expected sales wins, supported by successful marketing and promotional strategies.

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