- City Fajr Shuruq Duhr Asr Magrib Isha
- Dubai 05:28 06:47 12:13 15:10 17:33 18:51
A sharp decline in oil prices allied with higher spending depressed the 2009 combined Arab fiscal balance to a tiny fraction of its 2008 peak but the surplus is expected to have recovered in 2010, according to official data.
From a record high of around $250.4 billion in 2008, the budget surplus plummeted to only about $2.5 billion in 2009, showed the figures by the Abu Dhabi-based Arab Monetary Fund (AMF), a key Arab League institution.
Just below half the Arab League’s 21 nations recorded a deficit after the 2008 global fiscal distress sharply pushed down crude prices, depressed markets for the Arab non-hydrocarbon exports and forced many regional nations to largely boost spending as part of counter-crisis fiscal stimulus measures.
The 2009 surplus was the lowest since 2003, when the combined balance recorded a surplus of around $6.3 billion. In previous years, most of the Arab budgets were recording deficits because of relatively low oil prices.
The figures showed the UAE’s fiscal surplus dipped to around $six billion in 2009 from nearly $15 billion in 2008 while that of Saudi Arabia plunged from a record $155 billion to a deficit of about $23 billion.
Kuwait’s budget surplus slumped to around $9.5 billion from $34.7 billion while Qatar’s balance fell slightly to nearly $8.8 billion from $9.8 billion.
Algeria’s surplus of $12.4 billion in 2008 turned into a deficit of around $14.8 billion while Iraq’s surplus plunged from $17.2 billion to $5.2 billion.
Egypt continued to suffer from a deficit, which widened to around $12.9 billion in 2009 from $11 billion in 2008. Libya, a key OPEC oil exporter, saw its fiscal balance dip to around $5.8 billion from $23 billion.
Most of the other members recorded deficits in their 2009 budgets, mainly Morocco, Sudan, Yemen, Lebanon and Syria.
The report showed the plunge in the combined Arab fiscal balance in 2009 was caused mainly a sharp fall in revenue, which dived to around $592.8 billion from a record high of about $835.5 billion in 2008, when average crude prices soared to an all time high of nearly $95 a barrel.
Gulf oil producers were the main victims of the revenue fall because of their heavy reliance on crude sales, which account for the bulk of their income.
A breakdown showed Saudi Arabia’s total revenue slumped to nearly $152 billion in 2009 from as high as $293 billion in 2008 while the UAE’s income shrank to around $58 billion from $67 billion in the same period.
Kuwait’s earnings increased to $72 billion from $70 billion as income from its massive overseas assets were included.
Qatar also recorded growth in its revenue to around $36 billion from $34 billion because of a sharp rise in its LNG exports, which more than offset the decline in crude prices by nearly $35 in 2009 compared with 2008.
The report showed the combined Arab spending grew slightly to around $590 billion in 2009 from $575 billion but there was high growth in Gulf countries.
It gave no figures for 2010 but data released by some regional countries indicated it was a better financial year because of higher crude prices, which are expected to have averaged at least $10 above their 2009 level of $62.
Saudi Arabia, the largest Arab economy and the world’s top oil exporter, has just released 2010 fiscal results, which showed its budget recorded a surplus of around SR109 billion ($29.4 billion).
Kuwait’s nine-month budget surplus widened to nearly $25.1 billion in the first nine months of the 2010/2011 fiscal year on higher-than-forecast oil revenues and lower spending. The UAE and Qatar are also expected to unveil higher surplus through 2010 despite growing expenditure.
Follow Emirates 24|7 on Google News.