According to a report by London-based think tank Capital Economics, the UAE is anticipated to achieve a notable surplus in its federal budget for the upcoming year. This projection is based on the expectation that the UAE will be able to replicate its success from the current year due to its robust oil production, which has been supported by the recent decision of OPEC+ to reduce crude production. The report further highlights that the UAE has agreed to this latest OPEC+ decision and stands to benefit from more favorable quotas for crude production within the alliance.
Read more: UAE set for strong economic growth in Q4 2023
Meanwhile, Capital Economics predicted a rapid increase in oil production in the UAE starting from the first quarter of the following year. The company also highlighted that the UAE benefits from a relatively “low” oil price, which helps balance its revenue and expenditure.
Additionally, as per the report, the volume of tourists visiting Dubai has reached unprecedented levels, suggesting that it will serve as a significant pillar for the non-oil economy in 2024.
In October, the UAE government approved the general budget for 2024, which anticipates revenues of AED65.728 billion and expenses of AED64.06 billion. This indicates a projected surplus of AED1.668 billion.
The UAE budget represents 14 percent of the country’s total financial expenditure, with the remaining portion being covered by the seven UAE emirates, particularly oil-producing regions like Abu Dhabi. Each emirate has its own special budget, often surpassing the value of the federal budget. Abu Dhabi and Dubai, in particular, allocate substantial budgets for expenditures, including contributions to the financing of the federal budget.
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