DUBAI: The UAE booked a consolidated state budget surplus of AED 36.2 billion ( $9.9 billion) in 2011, the country’s finance ministry said, publicly releasing such data for the first time.
The ministry said the figure included the federal budget as well as the fiscal balances of all seven desert emirates which form the UAE.
Saeed Al-Yateem, executive director of revenue and budget at the ministry, told a news conference that the data would now be released every quarter starting next year.
That could be an important step in increasing the confidence of foreign investors in debt issued by Dubai, Abu Dhabi and other emirates.
Since Dubai was hit by a corporate debt crisis in 2009, eventually receiving a bail-out of at least $10 billion from Abu Dhabi, investors have been concerned by the emirates’ opaque finances. Some of the emirates, including Abu Dhabi which accounts for around 78 percent of total UAE spending, have not been publishing budget plans or final accounts.
The surplus revealed this week was equivalent to 2.9 percent of the 2011 gross domestic product of the UAE, the world’s third largest oil exporter, according to a Reuters calculation.
An International Monetary Fund report in June estimated, based on government data, that the UAE’s fiscal balance swung to a surplus of AE 38.6 billion in 2011 after two years of deficits.
The country posted a deficit of 23.0 billion dirhams or 2.1 percent of GDP in 2010, according to the IMF report.
Yateem said the ministry would soon release consolidated data for the first three quarters of 2012 and would also begin publishing annual, consolidated budget plans for the UAE.
Expenditures reached AED 343.7 billion in 2011, while revenue was 379.9 billion, the ministry said without providing comparative figures for 2010. That was well below the IMF June estimates of 401.5 billion and 440.1 billion respectively.
The IMF estimates consolidated only the accounts of the federal government with those of Abu Dhabi and Dubai, the two largest emirates, as well as Sharjah.
On an aggregate basis, the federal government and all its emirates together are expected to run a comfortable budget surplus of 6.4 percent of GDP this year, according to a Reuters poll of analysts.
That is despite a jump in spending.
Yateem said the ministry was submitting its 2013 federal budget draft to the cabinet, but declined to give details. In 2012, the federal budget deficit is expected to stay around 2 billion dirhams, he added.
“We are not going to reduce the budget, we will cover it (the federal budget gap) from our reserve,” he told reporters.
The federal budget accounts for only around 11 percent of overall fiscal spending in the UAE as most expenditure is conducted by Abu Dhabi.
The UAE has yet to approve a draft bill, debated for over two years, that would allow the federal government to issue bonds and help establish a local debt market. There is still no clear indication of when it will be passed.
Khalid Al-Bustani, the ministry’s assistant undersecretary for international financial relations, told reporters on Monday that the ministry had done its part and the draft was now in the legislative process. He did not comment further.
Until now, the respective governments of some of the UAE’s seven emirates have issued bonds separately.
UAE fiscal surplus $ 9.9 bn
