Most businesses in Dubai remain upbeat about short-term prospects, as they expect to achieve higher sales during the first three months of the year, according to a new Dubai Chambers survey.

The study, which gathered feedback from executives across the emirate, also found that nearly half of companies have plans to enter new markets in the region and abroad during the first quarter of 2024.

Among the 507 CEOs and managers polled for the survey, 60% anticipate growth in sales, up from 29% who projected higher sales in the previous survey, the Dubai Chambers reported on Wednesday.

Around 41% of respondents intend to expand into new markets outside the UAE, with the GCC region topping the list of target markets, followed by India, the United Kingdom, the United States, Egypt and South Africa.

Nearly six in ten of businesses (57%) are looking to diversify their offerings, while almost half (47%) seek to expand their production capacity.

A significant number (44%) also intend to spend more on digital ads, while 42% are looking to boost capital.

The results of the study indicate that efforts to improve the emirate’s business environment are providing a boost of confidence.

“Creating conditions that are conducive to growth strengthens the private sector’s confidence,” said Mohammad Ali Rashed Lootah, President and CEO of Dubai Chambers.

Analysts have said that Dubai and the rest of the UAE is not completely immune to global uncertainty, although reform efforts and healthy fiscal buffers are expected to mitigate risks.

In a separate report, Emirates NBD said it expects non-oil growth to slow slightly to 4.5% this year, on the back of slower global growth.

“Continued structural reform to improve the business environment and attract investment is expected to underpin aggregate demand, albeit at a slower pace than in 2023,” the bank said in its January 2024 report.

So far, business activity in Dubai’s non-oil private sector continued to rise in the beginning of the year, although companies are increasingly concerned about competition in the market and the supply chain disruption caused by the Red Sea turmoil, according to the latest S&P Global Dubai Purchasing Managers’ Index (PMI).

“The Dubai PMI data remained very positive at the beginning of the year, with output levels rising strongly on the back of healthy demand conditions and respective increases in new orders and purchasing. However, there are teething issues starting to appear,” noted David Owen, Senior Economist at S&P Global Market Intelligence.

 

(Writing by Cleofe Maceda; editing by Seban Scaria) seban.scaria@lseg.com