Sharjahs new finance strategy eyes spending efficiency

Wednesday, Apr 13, 2016

Dubai: Sharjah said on Wednesday its new financial strategy for 2016-18 would help to improve government spending efficiency and financial performance, as well as help build an innovation financial system.

The emirate’s finance department said in an emailed statement that a set of measures were taken to ensure effective management of the public debt improves its credit rating, and special attention was also given to develop certain skill sets. The strategy is based on transparency, social responsibility, creativity, innovation, integrity and empowerment, it added in the statement.

The finance department said it has made significant progress in the development of a financial performance system, including the development of a methodology to prepare and implement performance-based budgeting.

In the development of an accounting system, government account guidelines were also formed, alongside a financial statement preparation project using international accounting standards in the public sector. An integrated accounting policy was adopted in transition to accrual accounting.

“The new strategy builds upon the highly successful plans put in place in the previous years, and we are looking forward to adopting a distinctive model in public finance, as we have the required staff and infrastructure to do so,” Waleed Al Sayegh, Director General of the Sharjah Central Finance Department, said in a statement.

“The Department is committed to keeping pace with ongoing economic development to achieve the optimal results. We are drafting plans for innovative programmes that will serve as the main source of information about department’s projects in the near future, allowing for greater transparency and the tracking of performance indicator,” he added.

The previous strategy was also reviewed and the financial policy and economic model were found highly successful in carrying out the credit rating project, drafting the framework project for a medium-term budget and the creation of a public debt bureau, the department said.

Meanwhile, in February, ratings agency S&P affirmed its “A/A-1” long-and short-term foreign and local currency sovereign credit ratings on the emirate of Sharjah with stable outlook.

According to S&P, the economy of Sharjah is supported by a relatively diverse production base. The four largest sectors in the economy are real estate and business services (about 21 per cent); manufacturing (16 per cent); mining, quarrying, and energy (12 per cent); and wholesale and retail trade (12 per cent).

The rating agency estimates the GDP (gross domestic product) per capita at $28,700 (Dh105,329) in 2016. “We expect that real economic growth will remain relatively robust. We now expect economic growth to average 2.8 per cent in 2016-2018 compared with the 3.5 per cent we forecast in our November 2015 review,” S&P said in a report.

Staff Report