The UAE economy will benefit greatly from the high oil prices during 2012 although given the investment programmes and handout schemes which were announced during 2011, much of the money has already been earmarked for spending, say experts.
“Still, Abu Dhabi — and by extension the UAE — should benefit from achieving a healthy budget surplus, despite the generous spending plans,” Samuel Cizsuk, Consultant at the UK-based KBC Process Technology Ltd told Gulf News.
“Thanks to high oil prices this year, we think that the UAE will run a fiscal surplus of around 10 per cent of GDP (gross domestic product). However, our house view is that oil prices will fall next year as the global economy (and thus oil demand) weakens. We expect oil prices to fall to $85 per barrel and, as such, think the UAE’s fiscal surplus may narrow to around 5 per cent of GDP,” William Jackson, Emerging Markets Economist at the London-based Capital Economics Ltd told Gulf News.
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