The construction sector in Dubai grew by 4.5% in 2018 © KSahib/AFP/Getty Images
The construction sector in Dubai grew by 4.5% in 2018 © KSahib/AFP/Getty Images

Dubai public expenditure increase boosts construction

1 April 2019

Government investments in infrastructure has boosted the construction sector, which contributed 14.5% to the total economic growth of Dubai.

The construction sector grew by 4.5% last year as a result of a 32% increase in government spending on infrastructure projects, according to the Dubai Statistics Centre (DSC).

Arif Al Muhairi, executive director at the DSC, said: “The government investment in infrastructure projects proves that the government is moving forward in developing and enhancing Dubai's infrastructure which plays a strategic role in supporting the economic development and providing a supporting and stimulating environment for the business sector to flourish.”

Raw materials and materials for construction have increased by 7.14% year-on-year between Q4 2018 and Q4 2017, through rising costs in mining materials, and the cost of quarrying and manufacturing, according to the DSC’s Construction Cost Index (CCI). Costs have further risen following a surge in labour wages and other costs, the index added.

Trade performance, which grew 1.3% in 2018, had also been a large driving force, said Al Muhairi. He added that the transport and storage sector “play a vital role in Dubai’s economy as it supports various economic activities by providing the transport and logistics services to all”. This sector made up 13% of growth during 2018 and the sector grew by 2.1%, according to the DSC.

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