Economy

UAE government surplus hit $6.8bn in last quarter

March 14, 2024, 1:16 PM

Ramadan celebrations in Dubai. The UAE's government expenditure included goods and services, wages and subsidies

Revenues of AED156bn
‘Keen to diversify revenue’
5% GDP growth predicted

UAE government revenues reached AED156 billion ($42 billion) for the fourth quarter in 2023, resulting in the Gulf state recording a federal surplus of AED25 billion ($6.8 billion) over the period, according to data from the Ministry of Finance.

Expenditure over the three-month period hit AED131 billion. It was made up of investment in non-financial assets – such as real estate and vehicles – and current expenses, including employees’ wages, consumption of fixed capital, paid interest, subsidies, grants and social benefits.

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Net borrowing amounted to AED24.6 billion.

“The UAE government is keen to diversify its revenue sources, while also ensuring optimal use of financial resources and improved efficiency of government spending,” Younis Haji Al Khoori, under-secretary of the Ministry of Finance said.

The UAE’s gross domestic product expanded by more than 3 percent in 2023. Growth in the non-oil sector approached 6 percent, according to S&P Global.

The ratings agency predicted GDP will grow by a further 5 percent this year, driven by strong momentum in the hospitality, financial services, and wholesale and retail sectors.

The year has started off on a solid footing, with the S&P Global UAE Purchasing Managers’ Index (PMI) for February reporting the sharpest increase in output levels since the middle of 2019. The UAE’s PMI was up from 56.6 in January to 57.1 last month.

“The UAE is enhancing its competitiveness, as well as its commitment to fostering a dynamic economic environment and improving its tax system,” said Al Khoori.