UAE Economy Minister Says Can Keep Spending Despite Oil

The large fiscal reserves which the United Arab Emirates has built up will allow it to keep spending on development projects in coming years despite the recent plunge in oil prices, the economy minister said on Tuesday.

Although some people are worrying about oil prices, the UAE is expected to cope with the drop, Sultan bin Saeed al-Mansouri told a financial conference.

If sustained, the drop of Brent crude oil to near $60 a barrel will cause the UAE to post a moderately sized state budget deficit next year, private economists say.

But they think such deficits could easily be covered by the country’s reserves. Abu Dhabi’s largest sovereign wealth fund is believed to have nearly $800 billion of assets, roughly twice the UAE’s entire annual gross domestic product.