KUWAIT CITY, March 15: In the wake of the recent statement by MP Abdulhameed Al-Dashti saying that Parliament is endeavoring to waive the loans interest for foreigners, the head of Parliamentary Finance Committee MP Yusuf Al-Zalzalah confirmed the National Assembly will endeavor to write off the loans interest for non-Kuwaitis because “the injustice is the same’’, reports Al-Rai daily.

Meanwhile, MP Khaleel Al-Saleh has said the issue of waiving loans interest for foreigners is new, thus it should be studied, adding “proper solutions should be presented because the foreigners live amongst us and injustices against them affect all of us.”

MP Al-Saleh called for justice based on humanitarian principles, affirming total support to any solution that prevents injustices against foreigners.

Al-Zalzalah explained the KD 300 million which is the total interest on the loans will be borne by commercial and traditional banks. He stressed, the law would also be applied to Islamic banks which had given loans prior to 2008, if then they were traditional.

Disclosing additional details in the draft law Al-Zalzalah said “The government will bear the cost of principal or net loan while the banks will write off the interests that they were supposed to obtain from those loans — estimated to be KD 300 million.

He added the Islamic banks do not deal with interest and returns will not be written off. He noted the law includes addressing the conditions of the debtors with the finance companies and banks alike, pointing out there are 66,550 debtors whose loans amount to KD 720 million and the right to lawsuit continues for anyone who wishes “and this should be borne by the banks as a result of their mistakes by depriving them (banks) the KD 300 million that they were supposed to reap in the form of interests,” he stressed.
 He indicated the current plan is to establish a ‘Family Fund’ that will pay the principal amount and the debtor pays it to the state in installments which should not exceed 40 percent — the rate that has been approved and recognized by the central bank.

He added the law aims to deal with consumer and installment loans only which have reached a maximum of KD 100,000.

On the oversight on the banking sector to prevent a repeat of the crisis, Al-Zalzalah said “the Central Bank of Kuwait has prepared the best way to protect the citizen and the banks and the new instructions prevent a repetition of what has happened.”

He added, the problem started due to lack of discipline in the lending market before 2008, a period which saw large and wide facilities in loan and credit activities and that the banks had committed themselves fully after this date and bore KD126 million to address irregularities in loans and correct the mistakes that were committed during that era.

 On political stances, Al-Zalzalah said some believe that the law is aimed at settling scores with the banks and owners of large shares “and some others say the issue is about settling scores with traders, but the issues is neither, but rather a problem that already exists and must be resolved,” he stressed.
 About shareholders on the Kuwait Stock Exchange market, the banks owners who will lose profits as a result of inability to collect profits of such loans, Al-Zalzalah said these are the errors committed by the banks and only they must bear the responsibility and the shareholders can hold these banks to account.”

Meanwhile, MP Khalid Al-Shulaimi said the draft proposal to increase children allowances from KD 50 to KD 100 has received considerable support from the MPs and has been initially welcomed by the government.

He pointed out, “This is not waste of public money, but to experience the conditions of citizens in the face of rising prices and high cost of living, and a failure on the part of the government to monitor and correct these aspects for the benefit of citizens and residents.”

On the other hand, Al-Shulaimi ruled out any government reshuffle in the coming period. He added, “the ministers will stay in their posts, and I do not think any reshuffle or change will take place as alleged by some.”

He disclosed his plan to present a professional sports law that can uplift the standard of sports in this country.

He called for the creation of a big sports stadium in every governorate and every stadium should have its own administration to manage its affairs and equipments and follow-up on its maintenance.