|
 |
News |
 |
|
| |
Email this article |
 Printer Friendly Version
|
| |
Dubai's financial veil lifts to reveal deficit |
| |
1/13/2009 10:24:13 AM |
| |
|
| |
| |
Dubai has revealed its first acknowledged budget deficit, providing a rare insight into its opaque finances.
The budget statement - the most open published by the emirate - provides another example of the government's transparency drive, which is likely to develop further if the emirate is to receive a sovereign rating as planned this year.
Nasser al-Shaikh, director-general of the Dubai government's finance department, outlined at the weekend details of a Dh4.2bn (£780m) deficit at 1.3 per cent of gross domestic product.
Mr Shaikh also released an estimate of the emirate's 2008 GDP, at Dh301bn, and announced plans to give the economy a stimulative boost by increasing central government spending by 42 per cent to Dh26.5bn. "This is enough to keep the engine going," he said.
The spate of figures suddenly falling out of a black hole at the finance department left economists confused.
"It's more evidence of transparency, but the figures don't leave us all that wiser in terms of actual spending and debt obligations," said one economist. "There isn't much to compare it to."
Over the past few months the government's statistics centre has been revising Dubai's GDP upwards with the help of international consultants. The previoussystem, officials argued, was outmoded and unrepresentative of the emirate's true economic output."
The new methodology, to be unveiled by the statistics centre this year, put 2007 GDP at almost $73bn, officials said - well above the last official figure of about $50bn for 2006. The Dubai government has said its overall debt obligations amount to $80bn.
The revision, which at a stroke helps reduce the emirate's debt-to-GDP ratio, was balanced by Mr Shaikh's acceptance that the government would have to tame its previous GDP growth targets of 11 per cent a year to 2015 down to a more modest 4-6 per cent.
The overall budget saw spending on all government-controlled entities of Dh135bn this year, up 11 per cent on 2008's budgeted expenditure, Mr Shaikh said.
He said the government would in due course reveal actual revenue and spending figures for 2008 and he confirmed that spending in 2008 had exceeded the budgeted figures.
Overall revenues are set to rise 4 per cent to Dh138bn from all government-controlled entities, such as Emirates Airlines and Dubai World, the conglomerate that includes offshore developer Nakheel. Oil accounts for 3 per cent of GDP, with the budget based on an average oil price of $45 a barrel.
|
| |
Source: ft.com |
news |
| |
Email this article | Printer Friendly Version |
|
 |
| |
|
|
|
| Current Events |
 |
|
| DubaiGetaway |
 |
|
| Featured Links |
| |
|
|
|
