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Economic Overview<br />
<strong>NAFL</strong>-Yearbook <strong>2018</strong><br />
The total value of Dubai's trade in<br />
non-oil goods was AED1.28 trillion in<br />
2016, but its trade balance has been<br />
characterized by a permanent deficit<br />
as Dubai is a global hub for global and<br />
regional trade. Dubai's imports are<br />
much more than its total exports as<br />
most imports are transported to other<br />
emirates and to neighbouring<br />
countries without them being<br />
registered as re-exports.<br />
Dubai's unique geographic location<br />
as a link between Asia and Europe, as<br />
well as its excellent cargo and air<br />
transport links and free zones, make<br />
it an a ttractive location for<br />
i n t e r n a t i o n a l c o m p a n i e s t o<br />
participate in Global Value Chains,<br />
GVCs.<br />
Total FDI into Dubai stood<br />
at AED270.8 billion<br />
between 2011 and 2015<br />
and in 2016, the emirate<br />
ranked seventh among the<br />
world leading cities<br />
attracting AED25.5 billion<br />
in FDI. As an open<br />
economy, Dubai is affected<br />
by global trends, but FDI<br />
receipts are expected to<br />
recover in 2017-<strong>2018</strong>.<br />
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The wholesale and retail trade sector<br />
was the largest sector attracting FDI,<br />
accounting for 38.2% of the total in<br />
2015, followed by the finance and<br />
insurance sector 22.1%, and the real<br />
estate sector 21.7%.<br />
Dubai's real GDP grew to AED376.8<br />
billion in 2016, up 2.9% from 2015.<br />
The Government of Dubai has in<br />
recent years adopted a fiscal policy to<br />
rationalise public spending by<br />
reducing budget deficit as a<br />
percentage of GDP from 2% in 2010<br />
to 0.4% by 2013. Dubai has since<br />
maintained balanced accounts in<br />
2015 and 2016 following which the<br />
g o v e r n m e n t a d o p t e d a n<br />
expansionary fiscal policy to<br />
stimulate the economy.<br />
The emirate's success in reducing<br />
the budget deficit helped stabilise<br />
macroeconomic factors and resume<br />
growth in various sectors, especially<br />
banks, financial markets, trade,<br />
tourism and real estate.<br />
Foreign investment has helped turn<br />
Dubai into a global shopping and<br />
tourism destination. Gross fixed<br />
capital formation in wholesale and<br />
retail trade was AED17.1 billion<br />
between 2013 and 2015 and total<br />
investment in the sector was AED76<br />
billion between 2011 and 2015. A<br />
labor-intensive but relatively low<br />
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