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07 December 2023

Low oil price not to affect spending

By Nadim Kawach

Abu Dhabi announced yesterday it was pushing ahead with major infrastructure projects in its long-term development plan and said spending would not be affected by the sharp decline in oil prices.

The Abu Dhabi Department of Planning and Economy (DPE) said an ambitious growth target of a round seven per cent until 2015 remains in force despite a deepening global financial crisis and economic downturn in many countries.

DPE's International Economic Relations Executive Director, Hamad Al Mass, said Abu Dhabi aims to become one of the best five places in the world in terms of economic and human development. "The government is pressing ahead with all projects announced earlier… We know that there will be some external effects but the government appears determined to implement all projects and plans," he told Emirates Business.

"The most important thing is that there is determination and resolution to pursue those plans and objectives because there is a clear vision that has to be achieved… As for budget constraints, I don't think there have been any because there has been no revision of the planned spending on such projects… This means we are carrying on with the implementation of all plans."

Al Mass said a seven per cent growth targeted by Abu Dhabi until 2015 could still be realised despite a global economic downturn. He said the target is an annual average and that in some years growth could either exceed or fall short of the target. "We are hopeful this goal can still be achieved."

Abu Dhabi usually does not publish details of its annual budget as it is included in the consolidated finance account (CFA), which involves expenditure by each emirate and the federal budget. But there has been a sharp rise in the CFA spending over the past few years mainly because of high oil prices.

High spending and massive investments by the government and the private sector have boosted its economy, which accounted for 60 per cent of UAE's total GDP.