UAE to spend more next year

The United Arab Emirates federal government will increase public
spending by 3.4 percent next year despite the global economic
downturn, according to the draft 2010 federal budget released on
Monday. Spending will rise to 43.63 billion dirhams (11.89 billion
dollars) for the fiscal year 2010 , but the government expects
revenues to match expenditure and to balance the budget, making it
the sixth consecutive year without a deficit. The social services
sectors, including education and health care, receive the lion's
share of the budget, equivalent to 41 percent or 17.8 billion
dirhams (4.85 billion dollars). The budget of the federation of seven
emirates -- Abu Dhabi, Dubai, Sharjah, Ajman, Ras al- Khaimah, Umm
al-Qaiwain and Fujairah -- reflects "the sound fiscal policy of the
government through which it was able to achieve positive growth and
no deficit despite the global economic circumstances," WAM said. Like
its neighbours in the Gulf region, the UAE has witnessed a six-year
oil-fuelled economic boom. However, the onset of the global downturn
triggered a slowdown in the economy, especially in the emirate of
Dubai's real estate market, causing suspension of mega construction
projects and job layoffs as property prices plunged by 50 percent. In
addition to the federal budget, each of the seven emirates adopts its
own budget, which is much higher than that of the federal
government. With reserves estimated at 97.8 billion barrels of crude
oil, the UAE, with a population of about 6 million people among whom
more than 80 percent are expatriates, is a leading OPEC member.