Business community praises vision

Dubai: Economists and the business community on Tuesday welcomed the increase in expenditure and huge allocations for services and education in the UAE budget.

They said the Dh42.2 billion budget is also an indication of the country's financial strength despite the global turmoil.

"The federal budget is a reassurance that the UAE is not affected by the global financial turmoil. The significantly higher budget outlay this year is a clear signal to both local and international business community that the UAE has the ability and the willingness to pursue the growth path," said Hamad Bu Amim, director-general of the Dubai Chamber of Commerce and Industry.

Dr Mohammad Al Asoumi, an economist, said the UAE Government has once again shown that the country's finances are strong enough to withstand the global financial turmoil.

"In recent weeks, the government has announced a series of measures to strengthen its financial system. The significantly higher budget allocation to sectors such as education and health demonstrates that the country is strong enough to pursue its projects in all sectors," he said.

Dr Nasser Al Saidi, chief economist at Dubai International Financial Centre, similarly noted that "this budget is a confirmation of the fiscal strength of the UAE economy".

He said higher budget allocation will send positive vibes to the private sector.

"The budget once again proves that the country will pursue its strategy of growth through continued investment in infrastructure, education, health and social sectors," he added.

Negative sentiment

Aber Khalfan Al Hameli, chairman of Aber Group, said the budget should be seen in the light of global developments, which are currently driven by negative sentiments.

"All of us should hail the 2009 budget considering that the rulers have taken extra care to provide more funds (21 per cent) to ensure continuous growth. The push for education and services sectors is a refreshing and a welcome move, and I believe that this will provide the right stimulus for 2009," he said.

"In the past the government had give push to the banking and real estate sectors and that led to the phenomenal growth of this country. It is now necessary to enter the next level of growth wherein knowledge-driven sectors [education and healthcare] will become the growth engines of the GDP," Al Hameli said.

The education and services sectors have been allocated 23 per cent and 37 per cent respectively of this year's budget.

Yousuf Ali MA, Managing Director of EMKE Group and Director of Abu Dhabi Chamber of Commerce and Industry, said: "As expected a budget that truly reflects the progressive and visionary leadership of this great country. The very fact that major thrust has been laid on the education and health sectors clearly emphasises the great importance the government gives to the welfare of its citizens and residents."

"Also, the fact that the budget has been passed earlier than usual will immensely help each ministry and department to formulate their action plan well in advance to implement them effectively. Already UAE is creating ripples in the international market not only as an attractive investment destination but also as an aggressive investor in major projects and companies world over, and this will trend is expected to sustain for coming years as well.

"I am sure this budget will further strengthen the status of the UAE as one of the most stable and resilient economies in the region with enough firepower to tide over the current global turmoil," he said.

Mohammad Nafees, chairman of Pakistan Chartered Accountants Forum in Dubai, said the Government should be commended for increasing budgetary outlay despite difficult global economic conditions.

"It is a bold thing to increase expenditure in these times. The outlay for education and services shows that the government wants to maintain a high level of services and has the interests of the future generation in mind," he said.

Dr Khalid Maniar, managing partner of business consulting firm of Horwath Mak, observed that looking at the requirements of the growing UAE population the percentages of allocation for education and services "appear right" in the current inflationary conditions in the country.