A survey conducted on Monday showed that Dubai's non-oil private sector recorded its largest growth in a year and a half in April, indicating that the emirate's economy is approaching its pre-COVID-19 growth pace. The IHS Markit Purchasing Managers' Index for Dubai rose to 53.5 in April from 51 in March, comfortably surpassing the neutral level of 50 that separates growth from contraction, marking the highest reading since November 2019.
David Owen, an economist at IHS, stated, "The recovery of Dubai's non-oil economy accelerated in April, as production growth and new order levels returned to pre-COVID trends and business confidence rose to its highest level in nearly a year."
Dubai's economy, heavily reliant on sectors such as transportation, tourism, and retail, was severely impacted by the COVID-19 pandemic, with S&P Global Ratings estimating a contraction of 10.8% last year. However, travel and tourism activities have seen a revival, partly due to a vaccination campaign in the UAE, where nearly 70% of eligible residents have been vaccinated.
Owen noted, "Travel and tourism companies recorded the most significant improvement in performance amid growing hopes for increased tourism activity later this year, supported by the rapid distribution of vaccines." The survey also reported a slight increase in the sub-index for employment, rising to 50.6 in April from 49.7 in March.
Company expectations improved notably, reaching their highest levels since March 2020, fueled by optimism that the coronavirus crisis will diminish over the coming year.
