Dubai: The United Arab Emirates is confident it can maintain a budget surplus even as oil prices decline, but the International Monetary Fund warns the country will need foreign assets to fund developments.

Minister of Economy Sultan Bin Saeed Al Mansouri said at the UAE Economic Outlook Forum in Dubai on Tuesday the country will deliver a budget surplus until at least 2019.

The UAE will be able to absorb shocks to the economy in the short-term from the falling oil price, the Minister said.

Global benchmark Brent crude is down almost 50 per cent to since June. On Tuesday, it was trading down 3.06 per cent at $59.19 a barrel.

The falling oil price has raised concerns for budgets and the funding of government projects in oil dependent economies. The IMF warned on Tuesday the UAE economy is at risk from the falling oil price.

“The UAE is now at risk of tapping into its foreign assets,” Harald Finger, the IMF’s head of mission for the UAE, told the same forum in a speech that followed the Minister.

But the UAE is more bullish on its outlook even as some analysts warn oil could reach $50 a barrel.

Asked if the UAE is expected to use its foreign assets, which include foreign currency reserves, the Minister told Gulf News after his speech, “I don’t think at this stage that is necessary.”

“If there is a need for that it could come from the reserve, but I do not see at this time a need to do that because we do not have major projects to go for and whatever we have now we can manage,” Al Mansouri said.

UAE markets have tanked in recent weeks in response to the oil price plunge. The Dubai Financial Market has lost 27 per cent of its value since the start of the month. On Tuesday, the index ended 7.27 per cent lower at 3,083.69. The Abu Dhabi Securities Exchange lost more is down 9 per cent since the start of the month. On Tuesday, the index ended 6.9 per cent lower at 3,892.08.

Shaikh Ahmad Bin Saeed Al Maktoum, Chairman of Dubai’s Supreme Fiscal Committee, said earlier at the forum the Dubai government is “keen to control government spending and avoid a budget deficit”. He did not elaborate when asked what the government would do to control spending.

Projects in Dubai, which include the $32 billion expansion of Al Maktoum International Airport in Dubai World Central and the Dh2 billion Dubai Creek expansion, will likely go ahead as planned.

“What has already started in terms of projects will continue to be implemented and financed … [but] if the oil drops persists and remains under $65 a barrel, then capital projects will start to suffer,” Mohammad Lahouel, chief economist at the Dubai Department of Economic Development.

Abu Dhabi, which is highly dependent on oil revenues, has also dismissed any immediate impact of falling oil prices.

Shorooq Al Za’abi, an official from the Abu Dhabi Department of Economic Development, said at the forum the emirate had budgeted 2014 with oil prices at an average of $103 a barrel.

Brent crude has averaged at $102.35 a barrel for the first eleven months of the year, according to data from the United States Energy Information Administration (EIA). The average monthly price for December is likely to bring down the 2014 average.