SHARJAH, 26th December, 2022 (WAM) — H.H. Dr. Sheikh Sultan bin Muhammad Al Qasimi, Supreme Council Member and Ruler of Sharjah, approved the emirate’s general budget for 2023 with total expenditures amounting to nearly AED32.2 billion.
The general budget for this year aims to achieve financial sustainability and enhance the economic competitiveness of the emirate.
This budget was based on strengthening the financial foundations to enhance economic competitiveness, and cultural, scientific and tourism leadership. It was also based on strengthening government capabilities in facing global and regional challenges faced by global economies, including inflation, high-interest rates and economic stagnation, which is certainly reflected in all countries.
In light of this, the Sharjah government, using Its financial and economic tools, is working hard to reduce the adverse effects of these challenges on the financial and economic reality of the emirate of Sharjah and protect citizens, residents, companies, and institutions operating in it.
The general budget has adopted many goals, priorities and strategic indicators with economic, social, scientific and cultural dimensions. The most prominent of these goals is to promote investment in infrastructure and other economic activities, which enhance the emirate's competitiveness and the sustainability of its financial position. It is also meant to provide social support in various forms and methods that serve citizens and work to meet different life needs. It guarantees them social stability and economic well-being, which motivates them to give their best and contribute seriously and effectively to making the emirate of Sharjah a scientific and cultural platform, a tourist environment and a distinctive economy. In addition, it enhances Sharjah's cultural, economic and financial status on the local, regional and international map.
The budget has worked with its objectives and methodology to use and develop the best means and technologies to stimulate the economy, development and financial sustainability, as well as the growing interest in the resources and human energies of citizens and enhance their role in the processes of construction and sustainable development.
The budget worked to control and rationalise spending in areas that may not add value to the competitiveness and financial sustainability index to stimulate the efficiency of managing government spending by government agencies in the emirate.
Therefore, expenditures decreased by 12 percent from the 2022 budget, but without affecting the most critical areas. These include employment and economic and social development.
H.H. Sheikh Sultan bin Ahmed bin Sultan Al Qasimi, Deputy Ruler of Sharjah, said that the Sharjah Government’s budget for 2023, approved by H.H. Dr. Sheikh Sultan bin Muhammad Al Qasimi, Supreme Council Member and Ruler of Sharjah, mainly aims to support sustainable development, achieve financial sustainability, increase competitiveness and advance government services.
The budget for the new year will continue the process of development and progress, he added, while noting that previous years have witnessed valuable achievements and the new budget will add to them.
Sheikh Sultan bin Ahmed stressed that the emirate’s new budget considers all social, health, educational, knowledge, cultural and media services, as well as infrastructure, investment and tourism, through a package of initiatives, projects and activities covering all sectors.
It also prioritises the interests of citizens, residents, visitors and tourists, through a range of services and infrastructure projects, he further added.
Sheikh Sultan bin Ahmed thanked Dr. Sheikh Sultan bin Muhammad and stressed his commitment to the Sharjah Ruler’s directives, visions and aspirations to establish more ambitious major projects that prioritise people, the environment, culture and tourism.
Sheikh Mohammed bin Saud Al Qasimi, Head of the Central Finance Department in Sharjah, indicated that the general budget of the emirate has adopted many strategic and financial goals and priorities. This reflected the lofty directives of the Ruler of Sharjah and his comprehensive and renewed vision, the directives of the Executive Council and the strategic vision of the Central Finance Department.
This works to achieve the highest levels of financial sustainability, managing government financial resources and promoting the emirate's competitiveness in various economic and social fields and infrastructure. It supports the capabilities of government agencies in providing government services according to indicators set by the performance budget applied in the Government of Sharjah. In addition, it looks to strengthen strategic partnerships with the private sector and offer incentive packages that ensure they advance the wheel of growth and the Emirate’s development. It also provides techniques for financing the general budget in search of the best financing opportunities available internally and externally to ensure the government's sustainability.
Sheikh Mohammed bin Saud added, “The general budget for 2023 has two dimensions. The first is economic and social development and infrastructure, and the other is strategic, represented in developing and strengthening the government's financial sustainability. It adopted strategic priorities in stimulating the emirate's economy by granting discounts. It reviewed many service fees to reduce the cost of business for customers and investors. The budget also focused on providing many developmental and social requirements to achieve economic growth rates. These contribute to strengthening the role of Sharjah on the regional and global economic map, ensuring financial stability and improving the level of competitiveness of the emirate by providing distinguished financial and strategic services It offers an attractive environment for local and international investors and a tourist environment, which includes cultural, heritage, therapeutic, scientific and recreational tourism. All data, indicators and results are within international financial standards regarding inflation rates, sectoral spending and the rest of the macroeconomic indicators, as well as strengthening policy frameworks for controlling and rationalising government spending.
Sheikh Mohammed bin Saud said, “The budget reinforces the emirate's strategic direction in developing infrastructure in vital facilities and areas, preserving the environment and public health. It expands the role of tourism in the emirate through tourism and service projects supervised by the Ruler of Sharjah, which have achieved and will achieve added value.”
For the emirate to be an influential station for tourism and scientific and cultural attractions, it lays the foundations for a promising investment environment. It develops areas of investment in human resources and increases employment opportunities, which is one of the strategic priorities of the Ruler of Sharjah. It works hard to support government agencies financially and provide all necessary financing requirements to enhance their capabilities in implementing their strategic and operational initiatives and projects. It also ensures the achievement of the most distinguished services for citizens and residents in all areas of life per the best standards and practices that achieve the well-being and happiness of society. Sharjah has a distinguished position on the global cultural, scientific and tourism map due to the strategic vision of Dr. Sheikh Sultan and the cultural and civilisational creativity, and other achievements we are proud of.
Waleed Al Sayegh, Director-General of the Central Finance Department in Sharjah, stressed we are witnessing financial and economic instability in many countries due to many international economic practices, including high inflation rates and an increase in interest rates. This may lead to economic stagnation and limit the investment and financing capabilities of many international and local economies.
Al Sayegh stated that the emirate is a living and interactive part of the international and local environment. Therefore, through the general budget, the Sharjah government has taken into account these challenges and is also working two-dimensionally. First, it achieves financial sustainability and enhances economic competitiveness while working to provide social and employment requirements and needs. Second, it enhances the government's capabilities in building and developing the emirate's infrastructure, as the process of implementing capital projects and initiatives continues.
He said the 2023 budget has provided a practical framework for implementing the directives and priorities of the Ruler of Sharjah and be the strategic tool that translates the vision and strategy of the government with a modern and developed perspective. Therefore, the process of preparing the budget has taken place to prepare a long-term financial plan for the government, in addition to linking the general budget with many economic and social indicators. These include increasing the development and infrastructure, increasing economic competitiveness, and strengthening the role of the private sector through strategic partnerships to ensure that it continues to contribute to the development process.
The budget also provides social support, job opportunities and adequate housing For families to enjoy stability, reassurance, and family solidarity, which the Ruler of Sharjah referred to on more than one occasion. He is obsessed with providing a comfortable life and lasting prosperity to the citizens and residents of this emirate. Similarly, the government has worked to diversify the sources of funding for the budget to ensure the financial sustainability of the projects. The Ruler of Sharjah has directed implementation in various economic, social, tourism, scientific and infrastructure sectors in a professional manner and in accordance with the best international standards and practices.
Expenses
Waleed Al Sayegh indicated that the general budget decreased by 12 percent compared to the 2022 budget. However, the government continued to support the capital projects budget to ensure continuity in meeting the spending needs on these projects in 2023, as this budget constitutes 14 percent of the general budget. As for salaries and wages, they constituted 28 percent of the general budget for 2023. The same applies to operating expenses, which constituted 30 percent for 2023 with a decrease of four percent compared to the 2022 budget.
As for the support and aid budget, it constituted about 13 percent of the general budget and achieved an increase of five percent compared to the 2022 budget, while the loan repayments and interest budget accounted for 13 percent of the total budget. General Assembly for 2023, shows an increase of 65 percent over the 2022 budget, which is an enhancement of the government's ability and financial solvency to pay all its obligations.
In general, and to enable the government to achieve its strategic and operational goals and initiatives, the Finance Department has worked to enhance the stability and financial sustainability of the government. It has controlled government spending while working to meet the requirements of government agencies and improve their ability to meet development requirements and develop the level of rationalisation of government spending.
Classifying the budget based on economic sectors is one of the most important tools that reflect the strategic direction of the government. The infrastructure sector ranked first among the sectors in the general budget and constituted 35 percent of the total general budget for 2023. This reflects the exceptional interest of the government in developing infrastructure for the emirate as the central pillar of development and sustainability while attracting foreign and local investments in all vital sectors.
The economic development sector is relatively important in second place, as it constituted about 34 percent of the total general budget for 2023, with an increase of one percent over 2022. As for the social development sector, it came in third, as its importance constituted about 23 percent of the total public budget for 2023, to provide the best services, support and assistance to citizens and residents. The relative importance of the government administration, the security and safety sector constituted about eight percent of the total general budget for 2023.
Revenues
As for the government’s general revenues, at a time when these revenues constitute the primary source of financing the general budget, the government has taken an exceptional interest in developing these revenues, improving collection efficiency, and developing smart and technical tools and methods that enhance this trend. Moreover, it is clear from the analysis of public revenue trends, that operational revenues are 69 percent of the total revenue budget for 2023, an increase of 11 percent over the operating revenues for 2022.
The percentage of capital revenues reached 11 percent for 2023, while tax revenues constituted about 10 percent of total public revenues, with an increase of about 48 percent over tax revenues for 2022. In the same direction, customs revenues accounted for four percent, an increase of about four percent over 2022. Oil and gas revenues constituted about six percent of the total revenue budget for 2023, with an increase of about 96 percent compared to 2022.