Dubai government approves the 2021 budget of US$15.5b
A 57.1 billion dirham (US$15.55 billion) budget has been accepted by Dubai government, the commercial and financial center of the United Arab Emirates, for 2021, when the economy is expected to rebound from a recession this year, its ruler said on Sunday (Dec 27).
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The statement did not equate real investment in 2020. It was significantly higher than the updated spending figure of almost 56.16 billion dirhams cited by Reuters in August in the Dubai sukuk prospectus.
The scale of the 2021 budget is 14% below the 66.4 billion dirhams originally expected by the government for 2020.
Officials of the Dubai government were not immediately available to comment.
Economic dividends from the Expo 2020 world fair were included in this year’s budget. A six-month event initially planned to begin in October but delayed for a year due to the COVID-19 pandemic.
The 2021 budget, approved by Dubai Governor Sheikh Mohammed bin Rashid Al Maktoum. It takes into account the extraordinary economic circumstances of fiscal year 2020. Also the effect of the pandemic on the global economy. This is according to a statement on the website of Sheikh Mohammed.
Dubai expects an economic recovery
Dubai earlier this year had a hard time of a lockout and a suspension of flights. The economy, backed by the continuing stabilization of industrial activities, is forecast to contract 6.2 percent in 2020 before rising 4 percent in 2021, he added.
The statement claimed that, considering economic incentive initiatives introduced by the government to reduce certain fees and freeze fee increases. Dubai is forecast to generate public revenues of 52,314 billion dirhams. In the sukuk prospectus, that is 18.3 percent above revised 2020 sales estimates of 44.2 billion dirhams.
Non-tax revenue resulting from government payments for different programs accounts for 59% of overall estimated revenue. Meanwhile, the tax revenue accounts for 31%.
This means that a deficit of 4,786 billion dirhams is projected in 2021 in Dubai, smaller than the updated 2020 deficit forecast of 11.9 billion dirhams in the sukuk prospectus, but broader than the 2.4 billion dirhams originally budgeted for 2020.
The public revenue estimate is based on current activities in the Emirates and does not depend on oil revenue, which for fiscal year 2021 accounts for 4% of overall estimated revenue.