Kuwait’s Finance and Investment Minister, Dr. Anwar Al-Mudhaf, has announced that the country anticipates a budget deficit of 26 billion Kuwaiti dinars ($85 billion) over the next four years. Speaking to Kuwait TV, he revealed that in the past decade alone, Kuwait has accumulated a deficit of KD33 billion ($107.7 billion), which has been financed from the country’s state reserves.
Projected deficit of $18.2 billion for 2024-2025 FY
Looking ahead to the 2024-2025 fiscal year, Kuwait expects revenues of KD18.9 billion ($61.7 billion) against expenditures of KD24.5 billion ($80 billion), resulting in a projected deficit of KD5.6 billion ($18.2 billion).
Urgent need for economic reforms
In response to these challenges, Al-Mudhaf underscored the urgent need for economic reforms, focusing on fiscal sustainability and diversifying non-oil revenues to strengthen Kuwait’s economy. He outlined nine initiatives aimed at restructuring the budget and increasing non-oil income, stressing that these reforms are essential and supported by the country’s leadership.
Commitment to protecting social support
Regarding social support, Al-Mudhaf assured that citizens’ salaries will be unaffected, with subsidies directed more equitably to those in genuine need. Additionally, he highlighted the importance of fair distribution of support, addressing disparities between individual and corporate beneficiaries.
Diversifying economy, preserving reserves
Al-Mudhaf reaffirmed Kuwait’s commitment to economic reform through initiatives aimed at enhancing trade, tourism, and financial sectors while preserving reserves for future generations. He also emphasized that the country’s ruler has directed clear efforts to boost new investment opportunities, refuting claims of impending salary or bonus cuts as untrue.
Strengthening foreign investments
Furthermore, regarding foreign investments, the minister said that Kuwait has multiple agreements with Chinese firms and is working on developing free trade zones. He fuclarified that the Chinese government has assigned a company to handle and represent its interests in Kuwait, particularly at Mubarak Port, and there are also agreements concerning the Shaqaya project, housing developments, and the northern region.
Read more: Kuwait Central Bank issues bonds, tawarruq worth $782.8 million
Supporting private sector, diversifying financial tools
Al-Mudhaf also stressed the importance of supporting the private sector, expanding trade, and diversifying financial tools as part of Kuwait’s economic reform efforts.
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