Latest News
- Ministry Of Public Works Unveils 35 Projects For Fiscal Year 202...
- Electronic Inventory Service And Digital Repository For School L...
- Private Housing Electricity Debt Reaches 130 Million Dinars
- Kuwait And Philippines To Discuss Resumption Of Domestic Worker...
- Ministry Of Education Confirms 18,000 Employees Upload Certifica...
- His Highness The Amir To Attend PAAET Honor Graduates Ceremony
- Ministry Of Electricity Signs Energy Purchase Agreement With Oma...
- In Jleeb, Local Liquor Factory Seized
- Two Arrested For Forging Documents And Selling Counterfeit Work...
- Ministry Of Commerce And Industry Requests Accurate Shareholder...
- South Africa Waives Kuwaiti Visa Fees, Eases Visa Process
- Kuwaiti Diplomats Push For The Return Of 308 Missing Citizens
Financial Recovery In Years 2022-2026 To Be Governed By Fluctuations In International Oil Prices
The government of Kuwaiti expects the budget deficit for the fiscal year 2022-2023 to decrease by 74.2 percent, which it announced on January 24, based on the assumption that oil prices will be 44.4 percent higher than they were in the previous fiscal year.
According to the Economist Intelligence Unit (EIU), fundamentally speaking the structure of the draft budget is not different from previous budgets, which confirms its expectations that the financial recovery in the years 2022-2026 will be governed by fluctuations in international oil prices.
The sources noted that politicians of all stripes recognize the urgent need for fiscal reforms in the country, which was evident in the 2020-2021 budgets when the collapse of oil prices led to a record fiscal deficit of about 30 percent of GDP.
The permanent differences, according to the sources, between the government and the National Assembly will continue to rule out any serious change, and noted that the bloated public sector salaries will absorb more than half of the total spending (58.4%), which reflects the failure of successive governments to reform the labor market so that young citizens are directed to work in the private sector.
And she added, “In the absence of reforms similar to those that have been implemented in other countries in the Gulf Cooperation Council since the late last decade, government price support absorbs 16.1 percent of spending, and at the same time, only 13.2 percent of the total budget is allocated to capital spending (down 16.4 percent). percent over the previous budget), which means continuing slow progress in development projects that have been planned for a long time and in urgent projects to modernize infrastructure.
The Economist explained that the revenue components also highlight the stagnation of the policy-making process, as the budget shows that about 90 percent of these revenues will come from oil (a high rate even by regional standards), and the expected jump in the total income of 72.2 percent is based on a rise By $20 per barrel over its hypothetical price of $65, in addition to raising production to 2.7 million barrels per day while easing OPEC’s production cuts.
This prompts the magazine to expect that the fiscal deficit will be lower given that oil prices were over the past six months above the level of $70 a barrel, and data for the past nine months until the end of December show that income was 119 percent higher than the income approved by the 2021/2022 budget and that this reduced the deficit to 682.4 million dinars, compared to an expected deficit of 12.1 billion dinars for the whole year.
The Economist Intelligence indicated that the draft budget is consistent with its expectations that the fiscal deficit will shrink from the expected rate in 2021-2022 estimated at 6.5 percent of GDP to about 1.3 percent of it in the 2022-2023 budget on the basis of an average price of Brent oil mix which is $71 a barrel.
However, the magazine expected the deficit to widen again, to constitute an average of 2.9 percent of the gross domestic product in the budgets of 2023/2024; 2026/2027 as a result of the decline in oil prices and the absence of financial reforms.
Â
SOURCEÂ :Â Â TIMES KUWAIT
Trending News
-
Ministry Systems Hacked, Electricity Bills Altered
11 May 2024
-
Kuwait Unveils Monumental Solar Energy Project For...
06 May 2024
-
Eid Al-Adha Holiday In Kuwait: Potential 9-Day Bre...
15 May 2024
-
Expatriates Caught On Video Stealing Electricity W...
11 May 2024
-
Team To Inspect New Airport's Solar Panel Installa...
12 May 2024
-
Gulf Electrical Interconnection Project Will Boost...
04 May 2024
-
Issuing Work Permits Based On Academic Certificate...
07 May 2024
-
Kuwait Banks Seek Clarity From Central Bank On Cit...
04 May 2024
-
Kuwait Terminated 10,000 Expats Over 5 Years
15 May 2024
-
Kuwait Organizes 30 Events To Protect Children Fro...
04 May 2024
Comments Post Comment