The government of the United Arab Emirates said on Tuesday it has adopted a budget of AED42.2 billion (about $11.5 billion) for next year. The seven-member UAE federation has profited, like the other Gulf states, from soaring oil prices over the past few years and the 2009 budget marks a 21-percent increase over the current year. Education will account for 21 percent of the federal budget and health services 37 percent, the official WAM news agency said, without giving details for other sectors such as defense and security. The UAE has a total population of 5.6 million, including just 870,000 native Emiratis, and sits on estimated oil reserves of 97.8 billion barrels. The emirate of Abu Dhabi, also the capital of the UAE, contributes 90 percent of oil production. In addition to the federal budget, the seven emirates also have their own budgets which together usually exceed the spending of the federal government. Thirty-seven percent of spending was allocated to services and 21 percent to education, WAM said, adding that the cabinet approved the bill in a meeting earlier on Tuesday. The UAE was reviewing its economic policies to devise a three- to five-year plan that takes into consideration a global recession, Economy Minister Sultan bin Saeed Al-Mansouri said in remarks published on Tuesday. Like its neighbors in the world's biggest oil-exporting region, the UAE economy has been booming on six years of high oil prices. Oil have plunged by about half since hitting record levels above $147 a barrel in July on expectations of a downturn in energy demand during a global recession. Meanwhile, the UAE Ministry of Finance said on Tuesday it had injected AED25 billion ($6.81 billion) into banks as part of a government facility designed to help lenders cope with the financial crisis. “The Ministry of Finance of the UAE announced that it has placed the first portion of the payment to support liquidity at banks into implementation,” the ministry said in a statement emailed to Reuters. “This portion, which amounts to AED25 billion, is designed to support the capital of national banks. The allocations of each bank were determined based on the loans and credit portfolios,” it said. The UAE government said this month it would inject AED70 billion into the banking system.
