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Dubai non-oil private sector inches closer to pre-Covid-19 growth levels

It is a sign that the nation’s economy is closing in on the growth trajectory from pre-pandemic time

The non-oil private sector of Dubai has recently recorded its most significant expansion in 18 months in April, according to the media. It is a sign that the nation’s economy is closing in on the growth trajectory from pre-pandemic time.

The IHS Markit Dubai Purchasing Managers’ Index, which is adjusted seasonally, rose 53.5 in April from 51.0 in March 2021. The index is well above the 50 mark that separates expansion from contraction and the highest reading since November 2019 before the outbreak of the novel coronavirus.

David Owen, an economist at IHS Markit, addressed the media and stated that, “The recovery in the Dubai non-oil economy sped up in April, as output and new order growth returned to pre-Covid trends, and business confidence strengthened to the highest in over a year.” The country’s economy is heavily reliant on transportation, tourism and retail shopping. These sectors were hard hit because of the Covid-19 pandemic, with an estimated 10.8 percent contraction in 2020.

Due to the vaccination campaign in the UAE, where Dubai is also a part, tourism and travel gradually rebounded. It vaccinated about 70 percent of its eligible population. The travel and tourism sectors recorded the most remarkable bounce in performance. It also increased the hopes of a rise in tourism activity later this year that will be boosted by rapid vaccine roll-out.

Additionally, the employment sub-index also rose to 50.6 in April from 49.7 in March. Expectations on businesses also improved prominently to their highest since March 2020 based on the optimism that the Covid-19 crisis will abate over the next year.

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