United Arab Emirates Plans Higher Budget Deficit for 1999
June 2, 1999 - 0:0
ABU DHABI The United Arab Emirates expects its budget deficit to rise by 40 percent in 1999, reaching $676 million, up $196 million on the 1998 figure. The draft budget approved by the cabinet Monday envisages expenditures of $6.24 billion against an income of $5.56 billion, the official WAM news agency reported. The 1998 budget envisaged expenditures of $5.8 billion and revenues of $5.3 billion.
The UAE traditionally adopts its budget some way into a financial year -- the news agency did not detail how the 1999 spending was to be allocated round the different sectors of the economy. The UAE is trying to diversify its economy to cut its dependence on oil exports, which currently account for more than two thirds of its revenues. A sharp fall in world oil prices led to a pronounced recession in 1998 with GDP shrinking by 5.5 percent.
Production cuts agreed by oil producers to stabilize the oil price have shrunk the UAE's output to two million barrels per day from 2.157 million in June last year. Minister of State for Financial Affairs Mohamed Khalfan bin Kharbash acknowledged earlier this month that the government's efforts to boost public spending in the new budget would aggravate the deficit but he insisted that it would be kept under control.
The budget will come into force once it has been approved by the head of state, Sheikh Zayed bin Sultan al-Nahayan. The Federal Buget constitutes only around a third of public spending in the UAE -- the rest is spent by the seven Emirates which make up the federation, particularly the two richest, Abu Dhabi and Dubai. (AFP)
The UAE traditionally adopts its budget some way into a financial year -- the news agency did not detail how the 1999 spending was to be allocated round the different sectors of the economy. The UAE is trying to diversify its economy to cut its dependence on oil exports, which currently account for more than two thirds of its revenues. A sharp fall in world oil prices led to a pronounced recession in 1998 with GDP shrinking by 5.5 percent.
Production cuts agreed by oil producers to stabilize the oil price have shrunk the UAE's output to two million barrels per day from 2.157 million in June last year. Minister of State for Financial Affairs Mohamed Khalfan bin Kharbash acknowledged earlier this month that the government's efforts to boost public spending in the new budget would aggravate the deficit but he insisted that it would be kept under control.
The budget will come into force once it has been approved by the head of state, Sheikh Zayed bin Sultan al-Nahayan. The Federal Buget constitutes only around a third of public spending in the UAE -- the rest is spent by the seven Emirates which make up the federation, particularly the two richest, Abu Dhabi and Dubai. (AFP)