Expo 2020 Countdown

Businesses upbeat on prime projects

October 2019

New export markets and projects being launched ahead of Expo 2020 are energising economic activity in Dubai, particularly in the trading and construction sectors, and businesses are confident of improved outcomes in the months ahead.

The quarterly survey of Dubai Economy shows Composite Business Confidence Index (BCI) in the emirate improving 2.2 points to reach 114.9 in the second quarter of 2019, compared to 112.7 points in the same period of 2018, with respondents anticipating higher volumes and profits.

 The survey also showed that 83 per cent of the businesses in Dubai rated their situation as ‘good’ or ‘stable’ in Q2, 2018 while the others had to deal with a few obstacles, such as weak demand during Ramadan and increasing competition.

 The proportion of businesses foreseeing an improvement in the business situation has slightly increased from 45 per cent for Q3, 2018 to 46 per cent for Q3, 2019, while 43 per cent expect stability to prevail.

 Large companies continue to maintain stronger projections as compared to small and medium enterprises (SMEs) with Composite BCI scores of 118.3 and 109.9 points for Q3, 2019, respectively.

 As Dubai successfully promotes itself as a competitive source market, 22 per cent of the firms look to exporting to new markets during Q3, 2019. 

Commenting on the latest BCI scores, Khalid Al Kassim, assistant director general for economic affairs in Dubai Economy, said businesses in the emirate are being innovative and seizing opportunities in spite of a challenging global economic landscape.

 “Businesses in Dubai have been able to remain competitive and aim for the next level as a series of measures adopted by the government continue to enhance ease of business and create new economic opportunities,” he stated.

 A comparison of expectations among key economic sectors reveal that the trading sector holds the strongest outlook for sales revenue, volumes sold, profits, hiring and new purchase orders as compared to the manufacturing and services sectors for Q3, 2019.

 Overall, 50 per cent of businesses are looking forward to their revenues improving in Q3, 2019, chiefly on higher volumes, while 33 per cent estimated stable revenues.

 Within services, the construction segment is the most optimistic about volumes for Q3, 2019 with a net balance of 41 per cent on account of rise in new projects and expected improvement in market conditions. I  Exporters are more optimistic than the overall business community, with Composite BCI scores of 115.9 and 114.9 points, respectively.

In the coming 12 months, 30 per cent of the firms intend to expand their current headquarters.  

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