The construction sector in Dubai is considered one of the key sources of employment, income and growth for Dubai. The sector contributed by 12.2% to Dubai's non-oil GDP in 2004.The construction sector GDP increased by 166 % during the period 2000-2004 and has grown with an annual average growth rate of 27.7% during the same period reflecting the construction boom being witnessed in the Emirate. The construction sector's GDP is expected to reach AED 15,985 million in 2005.
The above table shows the significance of Dubai construction sector to UAE. It contributed by 48 % in the year 2004, this share has grown from 30% in 2001.
According to the DCCI membership database, the number of active construction companies amounts to 5,938 in 2005. Small size companies "which employed 1-19 workers" is dominant in the sector, it represented 76% of the total number in 2005.
Contracting of civil engineering works represented 45% of all construction companies working in the sector followed by the building completion with 33 %.
In the year 2004, the total number of completed buildings totaled 2,119 of which 68% were villas & residential complexes, 19% were Multi-storey Commercial Buildings and 13% were Industrial, Recreational, & Services Buildings.
The number of under construction buildings totaled 4,852 in the year 2004 of which villas and residential complexes represented 74 %.
There are other ambitious construction projects running in Dubai scheduled for the next 10 years, for example, Burj Dubai, Nakheel Islands, Dubai Land, Dubai light rail transport (LRT) project and Deira Palm Island. In addition, the announcement of a $4.3 billion plan to redevelop Dubai's World Trade Center (DWTC) is another endorsement of Dubai's pursuit to maintain its reputation.
The GCC region has witnessed a great boom in the construction sector with projects estimated at hundreds of billions of dollars, of which a significant part is being spent on the UAE's huge projects. The construction sector benefited from the recent increase of oil revenues, repatriation of GCC money due to attractive business opportunities and historically low interest rate.
Dubai possess many incentives that attracted foreign direct investment to the construction sector, the stability of the market to absorb more investment , availability of financial facilities, higher return of investment, in addition to the expected new law that will allow even more expatriates to own property, all these factors continue enhancing the sector to boom.
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© Press Release 2006
