Commercial disputes handled by the Dubai International Arbitration Centre have dipped for the first time in at least five years.
Fewer business disputes in Dubai as property market recovers
Commercial disputes handled by the Dubai International Arbitration Centre (DIAC) have dipped for the first time in at least five years.
Experts say the drop indicates signs of stability in the emirate's once troubled property market.
Arbitration cases dropped 14 per cent to 379 last year, down from 440 in 2011, according to data released yesterday by the Dubai Chamber of Commerce and Industry, which oversees the centre.
The number of cases had risen every year since at least 2007, the earliest year in which the data was provided.
"I see this drop as a good sign of less disputes around businesses," said Hamad Buamim, the chamber's director general.
Lawyers said the fall was a reflection of a strengthening property sector, which has been one of the main drivers of commercial disputes after the market downturn in 2009.
DIAC emerged as one of the leading centres for commercial dispute resolution in the region as individuals and companies resorted to arbitration in response to disagreements over payments and projects. But a return in activity in the property market has helped to defuse disputes as stalled projects resume and prices begin to creep up.
"Many of these cases have gone through and now we are getting back to normal where there is still some real estate [cases], but the number has declined, and there are some trade cases," said Victor Leginsky, an independent lawyer and arbitrator, who has worked on about 50 arbitration cases, mainly at DIAC.
In a further indication of more cordial relations among businesses, the number of mediation cases at the chamber dropped to 553 from 878 the year before. A total of 34 per cent of the cases were resolved.
The figures were released as part of the chamber's annual report. Other data in the report also signalled steadiness in other parts of the economy.
Exports and re-exports by Dubai Chamber members rose by 9 per cent to Dh268 billion (US$72.96bn) last year from the year before.
A more than tripling in the value of goods heading to Iraq and a 300 per cent rise in exports and re-exports to Libya have helped to offset a 54 per cent drop in exports to Iran, once the emirate's top trading partner. Exports and re-exports to Iraq rose from Dh9bn in 2011 to Dh42bn last year. Trade with Saudi Arabia and Qatar was also strong, making up nearly a third of exports and re-exports. Trade going to Syria dropped by 52 per cent.
The data indicates that Dubai companies are managing to find new markets for their goods despite turbulence caused by the Arab Spring and sanctions against Iran.
The rate of annual increase sagged from 15 per cent gains in the previous two years.
"Our annual figures show that 2012 was a very successful year as our members achieved unprecedented monthly export figures," said Mr Buamim. "Trade, along with tourism, logistics and financial services, continue to play vital roles as key drivers of the emirate's economic growth."
GDP is likely to have risen by 4 to 5 per cent during the year and was expected to maintain momentum this year, he said.
Underlining the steady economic performance was a rise in the chamber's members during the year. It added 12,733 new members during the year, a rise of 20 per cent, taking its total membership to 140,000.
"There is more focus on services," said Mr Buamim. "Many companies are establishing in the service sector and health care. Of course, trade and commerce are the main type of members we are attracting. But we are starting to see real estate come back and more lawyers are joining."
This year the economy was expected to remain robust based on its pillars of trade, logistics and tourism, he said.