UAE expects first budget surplus in two decades
The UAE is expected to post its first budget surplus in 20 years as a result of soaring global oil prices, while its deficit shrunk notably in 2004.
Also as a result of increased gas and oil earnings, UAE revenues increased by 22.6 percent in 2004 to Dh94.4 billion, and expenditure increased by Dh3.8 billion to Dh95.3 billion in 2004, up from Dh91.4 billion the previous year.
Current expenditure, valued at Dh80 billion, constituted 84 percent of total expenditure against Dh74.3 billion in 2003.
Economists such as Hany Genana expect the trend to continue. "Our expectations are that the UAE's consolidated government finance account will post its first surplus in 2005 in 20 years due to increased revenues from high oil prices," he said, according to Gulf News.
The surplus is projected at Dh7 billion to Dh10 billion.
Meanwhile, non-tax revenues increased to Dh85.2 billion by 21.7 percent against Dh70 billion in 2003, accounting for 90.2 percent of total revenues.
The increase was attributed to a Dh16.6 billion rise in receipts from oil and gas exports, while profits of shareholding firms rose to Dh3.3 billion, up 13.2 percent.
According to the UAE 2006 Year Book, "The deficit narrowed by 94.1 percent to Dh855 million in 2004 compared to a deficit of Dh14.4 billion in 2003. This deficit was financed in its entirety by returns on government investments."