Dubai growth forecast cut to 6pc

source Gulf Daily News

Dubai expects economic growth of between four to six per cent next year compared to an earlier forecast of 11pc.

"According to the Dubai government's strategic plan, the growth rate should be 11 per cent. But I expect it to be between 4pc and 6pc due to the effects of the international financial crisis," finance department director-general Nasser Al Shaikh said.

"This is much better than the developed countries in which the growth rate might be zero," he said.

"The budget will be announced very soon. It will show to all the strength and resilience of Dubai's economy and prove all the rumours floating around about the emirate's precarious finances wrong."

Al Shaikh is a member of a Dubai committee set up to respond to a financial crisis that has shaken investor sentiment and heightened concerns about transparency in the emirate.

Reports about the health of Dubai's real estate sector were exaggerated, he said.

"We have heard all about Dubai's real estate sector going into recession, with statements by many non-official bodies claiming 70,000 residential units would be offered this year," Al Shaikh said.

Such a figure would suggest that prices could fall due to oversupply. But, he said, a study done with top property developers found the figure is closer to 34,000 and could be as low as 28,000 due to operational delays by some contractors.