KUWAIT CITY (KUNA): The conservative policy of the Kuwaiti government in dealing with the oil prices swinging, from 1992 to 2007, protected the state’s economy from the negative impact of such fluctuation, an economist said. Speaking on the findings of his PhD research, economy specialist Dr Anwar Al-Shryaan told KUNA that the Kuwaiti government’s policy was successful because it stabilized the oil price at $30 per barrel when estimating the state’s public expenses and incomes.

However, he said that the government’s conservative scheme, especially regarding expenses, started to unwind in the last two years compared to the previous years. He warned that if that continues, it would negatively affect the Kuwaiti economy. Al-Shryaan called on the government to continue its conservative development policy in dealing with the swinging of oil prices, pointed out that his research showed that there is no relation between the current inflation in Kuwait and oil prices.

Inflation will not be solved by the increase of salaries, but by controlling prices through putting a maximum limit for profits of imported products, he added. He said that the research paper consisted of three parts studying the effects of oil prices swinging on the Kuwaiti economy, whether traditional or Islamic banks were more efficient, and determinants of the exchange rate of the Kuwaiti dinar.