UAE budget forecasts $598 million deficit for 2001
The oil-rich United Arab Emirates (UAE) government is ready to adopt a federal budget for 2001, with a deficit of around $598 million, a newspaper reported Wednesday.
The budget, which will be examined by the government in early February, forecasts spending of $6.333 billion against revenue of $5.735 billion for the federation, Al-Ittihad said.
The deficit, while down from $664 million in 2000, remains high largely due to an increase in salaries of high-ranking state officials and the rise in the number of education ministry staff, it said.
The average oil price estimate for this year's budget was not disclosed. The UAE traditionally adopts its budget well into the fiscal year, which runs from January to December.
Oil accounts for more than two-thirds of revenues of the UAE, whose OPEC output from February 1 will be 2.201 million barrels per day.
The forecast deficit comes despite the fact that gross domestic product (GDP) in the UAE grew 14 percent in 2000 on the back of increased oil prices, according to an Emirates Industrial Bank report published earlier in January.
According to the report, GDP reached $59.1 billion in 2000, up from $47.4 billion in 1999. The 14 percent increase, not seen since the last oil boom in the 1980s, comes largely because of higher revenues from crude oil, which represented 38 percent of GDP in 2000 against 27.5 percent in the previous year, the bank said.
The report said oil revenues in 2000 reached $22.6 billion against $13.1 billion in 1999.
The UAE's federal budget is in theory financed by the seven member emirates of Abu Dhabi, Ajman, Dubai, Fujairah, Ras al-Khaimah, Sharjah and Umm al-Qaiwain. But the majority of funds are provided by Abu Dhabi and Dubai, the largest and wealthiest of the federation. — (AFP, Abu Dhabi)
© Agence France Presse 2001
© 2001 Mena Report (www.menareport.com)