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KUWAIT CITY, Dec 1: Several MPs-elect have asked HH the Prime Minister Sheikh Jaber Al-Mubarak Al-Sabah to choose competent and technocrat ministers who will be part of his government.
They pointed out the premier will earn their support and cooperation if he appoints such ministers, otherwise, there will be tension between the two authorities. MP-elect and opposition member Shuweib Al-Muweizri said the prime minister’s choice of ministers will reflect his desire for reform and cooperation with the National Assembly.
On his Twitter account, Al-Muweizri stressed that appointment of statesmen who have Kuwait and its people in their hearts will mean support from MPs.
Furthermore, MP-elect Nayef Al-Mirdas underscored the need to address corruption issues in the Ministry of Health and prosecute those proven guilty, indicating that someone suspected of involvement in corruption should not be appointed as minister.
On his Twitter account, Al-Mirdas said the prime minister must abandon the old style of choosing ministers in order to appoint technocrats and competent people with the ability to realize the ambitions of citizens.
MP-elect Abdul Wahab Al-Babtain emphasized the need for the new government to cooperate with the legislative authority, adding the prime minister must choose competent people. MP-elect and opposition member Adel Al-Damkhi suggested ways to stop withdrawal of citizenship, imprisonment, deportation and prosecution for political reasons as follows: request for amnesty from His Highness the Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah, enact legislation stating that withdrawal of citizenship should be done only through a court verdict, and grilling requests should be presented only if the government does not respond to the demands of the Parliament.
He believes that granting amnesty entails understanding with the political leadership and folding the past page which may trigger a major crisis between the two authorities. Meanwhile, according to Moody’s Kuwait’s election results will impede reform efforts, a ‘Credit Negative’.
The following is the complete research: On Nov 26, Kuwait (Aa2 negative) held early parliamentary elections in which opposition groups won 24 out of 50 contested seats and voter turnout was around 70 percent, much higher than the 52 percent participation reported during the last election in July 2013 and the highest level on record since the 1990s.
Most of the newly elected members of Parliament (including some not affiliated with opposition groups) had expressed strong opposition to the government’s fiscal reforms and to subsidy reforms in particular.
Therefore, we interpret the results as a clear repudiation of the government’s austerity measures. This is credit negative because it will likely sway the government’s willingness to implement fiscal and economic reforms to reduce the country’s dependence on oil.
Earlier this year, the government unilaterally approved a series of gasoline price hikes that took effect in September. But legislators’ strong opposition to the measures led to a surprise dissolution of Parliament on 16 October by Kuwait’s ruler His Highness the Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah. Notwithstanding that opposition, the dissolved National Assembly, which was meant to run through July 2017, had been considerably more cooperative than the incoming legislature is likely to be, because most opposition candidates had boycotted the last election.
Kuwait has been slower than its peers in the Gulf Cooperation Council (GCC) to develop its non-oil and private sectors, and was the last to implement fuel subsidy reforms. Although Kuwait has the lowest fiscal and external breakeven oil prices in the GCC (at $47.8 and $40.1, respectively, in 2016, according to the International Monetary Fund) and has exceptionally large government financial assets (we estimate at nearly $600 billion, or almost 530 percent of GDP, in 2015), it is also the GCC country with the highest dependence on oil as measured by exports and government revenues.
Slower progress than peers in economic diversification and implementing fiscal reforms in response to the oil price shock is in part because unlike other GCC countries, Kuwait’s political environment is more liberal, allowing for unions and for Parliament to challenge government policies.
These democratic elements of Kuwait’s governing system have repeatedly undermined the government’s ability to implement reforms. The National Assembly can veto royal decrees with a two-thirds majority, but Kuwait’s ruler can dissolve Parliament and has done so seven times since 2006 because of friction between the government and Parliament.
Notwithstanding these frequent dissolutions, strong public and parliamentary opposition to policies has swayed the government to roll back reforms. In January 2015, the government raised the price of diesel and kerosene to $0.56 per liter from $0.18 per liter, but a month later reduced prices to $0.36 per liter following criticism by members of Parliament.
Limited implementation of fiscal and economic reforms would erode Kuwait’s economic and fiscal strength. In a simple no-reform scenario, with government expenditures fixed at around 55 percent of GDP from 2016 onward, and with no changes to our other base case assumptions (oil price and production, growth and inflation, funding mix), the fiscal deficit would average 3 percent of GDP between 2016 and 2020 and government debt would rise to around 54 percent of GDP by 2020 from 11.0 percent in 2015.
This compares with our baseline scenario, under which expenditure growth would be lower than nominal GDP growth, resulting in an average fiscal surplus of close to 1 percent of GDP and a slower rise in the debt/GDP ratio to only about 28 percent.
By Abubakar A. Ibrahim Arab Times Staff and Agencies