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28 March 2024

30,000 UAE expats to benefit from pay rise

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By Staff

A Presidential decision to raise the salaries of Federal civil servants will benefit more than 30,000 expatriates and is expected to spur business in the second largest Arab economy, officials and analysts said.

Despite the massive pay rise, the move is not expected to stoke inflation and the consumer price rate could still be as low as two per cent in 2012.

Government statistics showed a total of nearly 70,800 employees in federal departments would benefit from the 35-100 per cent salary increase, which will take effect on the start of 2012.

They include around 40.213 Emiratis and 30,608 expatriates, mostly from Arab countries and Southeast Asia. The figures showed 48 federal government establishments are covered by the salary increase.

“The increase will surely bolster job stability, increase productivity and upgrade performance… it will also provide an additional incentive to federal employees to remain in their jobs and continue their work and efforts,” said Humaid Al Qatami, minister of education and chairman of the federal authority for human resources.

Analysts said they expected the rise to cost the UAE’s coffers around Dhthree billion a year. But they noted the sum remains a fraction of the country’s expected oil export revenue of at least Dh250 billion in 2012.

“I think the increase will encourage people to spend little more despite their psychological fears of global financial conditions,” said an Abu Dhabi-based banker. “This will spur consumer spending and consequently give a push to business activity…but I don’t think it will stoke inflation because the increase cover only a fraction of the total employees in the UAE and inflation fundamentals that prevailed two years ago no longer exist.”

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