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Saturday , March 25 2023

Increase in non-oil GDP expected this year

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KUWAIT CITY, Sept 11: The International Finance Institute has forecasted that the real non-oil GDP growth in Kuwait will reach 3.4 percent this year, backed by the country’s progress in vaccination, the high oil prices, and the fiscal expansion, reports Al-Rai daily. In a report, the institute explained that food prices rise by about ten percent in June on an annual basis due to the rise in food prices globally.

Despite the decline in oil exports, the current account surplus increased significantly in 2020, backed by the increase in investment revenues mainly from the direct investments in Kuwait and its overseas portfolio investments. While the institute expects further expansion of the current account surplus due to the rise in oil exports, it expects the fiscal deficit, excluding investment income, to remain large in 2021, reaching nine percent of GDP, and rising to 13 percent in 2022.

Meanwhile, financing would present a challenge as the parliament is still opposing the law that would allow the government to borrow from international markets, even though the government debt is the lowest in the region. The report highlighted that Kuwait still lags behind other GCC countries in implementing a medium-term reform plan to address financial sustainability and enhance the role of the private sector in the economy

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