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Financial status of Kuwait excellent and solid – Al-Saleh stresses need to diversify sources of income

KUWAIT CITY, Nov 12: The financial status of Kuwait is “excellent and solid” as shown in reports from international rating agencies, says Deputy Prime Minister and Finance Minister Anas Al-Saleh. Speaking to reporters after attending the joint meeting between the Finance, Economic Affairs, Budgets and Final Account committees in the Parliament, Al- Saleh warned about the possibility of budget deficit in the current fiscal year and the next five years if oil prices will not increase.

Asked about the government’s failure to honor its obligations to some State bodies, the minister said: “It’s a deliberate matter to consider these bodies and to look into possible issuance of bonds to gauge their capabilities, instead of cash trading.” Talking about the meeting during which he presented the government’s vision in addressing the budget deficit, Al-Saleh affirmed the government listened to the remarks of the Parliament members on the economic situation.

He promised all these remarks will be taken into consideration. He added the State Budget Law stipulates that finance of budgets comes from monetary reserves, while the Public Debt Law, whereby the Central Bank of Kuwait (CBK) is issuing bonds at present, allows borrowing from monetary reserves for offsetting budget deficit. Stressing that the existing law is enough and there is no need for a new bill, the minister asserted it is possible to add some articles to the Budget Law.

Diversify
He also pointed out efforts to diversify sources of income through the government’s recommendation to the Parliament. On the other hand, Undersecretary of the Finance Ministry Khalifa Hamada discussed the public financial aspects and CBK Governor Dr Mohammed Al- Hashel explained the economic outlook and the importance of distributing debt instruments by resorting to the general reserves, issuance of bonds in dinars, Sukuk (instrument) and bonds in dollars. He pointed out this will be done in different stages in order to address the deficit while maintaining the financial strength and durability of the State.

Meanwhile, Budgets and Final Account Committee Rapporteur MP Mohamed Al-Huwailah clarified the main objectives of the meeting are to find a way to address the budget deficit and strengthen coordination between the two authorities to achieve their goals. He said there are several options for the government to address the deficit such as using the Future Generations Fund in line with Article Eight of law number 3/1978 in the preparation of budgets.

He cited other options like transfers between government agencies, issuance of bonds and instruments by the State or borrowing from local banks. He also stressed the need to diversify sources of national income, rather than total dependence on oil, to protect the general budget from the danger of falling oil prices. He pointed out this step aims to protect the Kuwaiti economy, considering the economic structure of the country depends on oil while the internal and external investments do not exceed eight percent.

He emphasized the significance of focusing on developing various fields like human resources, education, health and infrastructure to boost the economy. Commenting on the issue, MP Ahmed Al-Qudaibi warned against borrowing from foreign institutions to address the deficit. He asserted this is an unacceptable move, adding the oil sector should be away from political interference.

Moreover, Human Rights Committee Rapporteur MP Askar Al- Anazi confirmed that Head of the Central Agency for Remedying the Status of Illegal Residents (CSRSIR) Saleh Al-Fadalah has been invited to the next panel meeting to discuss the proposals related to the civil and social rights of Bedouns. He revealed the committee noticed that the agency has yet to grant certain rights to Bedouns, stating these people should be treated fairly considering their contributions to the nation. He cited as an example the Bedouns who participated in Arab wars. Also, the Youth and Sports Committee on Thursday recommended amendment of the voting process in local sports clubs to become one-vote system. MP Dr Abdullah Al-Turaiji said this recommendation, along with the proposed privatization of sports clubs, will be referred to the Priorities Committee.

On the privatization of sports clubs, the panel agreed to discuss this matter in detail with Public Authority for Youth and Sports Director Sheikh Ahmad Al-Mansour and his deputy Dr Humoud Flieteh next week. They will also tackle the causes of stopping sports activities in the coun

By Abubakar A. Ibrahim Arab Times and Agencies

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