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Thursday , October 29 2020

Stimulus bill, dissenting government

Ahmed Al-Jarallah Editor-in-Chief, the Arab Times

IS the government trying to push the private sector into bankruptcy, thereby undermining the most important pillar of the national economy?

The Cabinet is seven months late in referring the fiscal stimulus bill to the National Assembly.

Furthermore, it has chosen a time when the current legislative term is about to end. That is tantamount to firing a bullet at the head of the most vital productive sector. It will push thousands of people into financial challenges and attract a barrage of lawsuits and jail terms.

It is difficult to overlook the fact that our rational government had the opportunity to avoid all this, but it instead decided to handle this matter in an unjustified procrastinating manner.

During the past months, the government embarked on endeavors for establishing field hospitals. It spent tens of millions for this purpose, and even allocated about $400 million for face masks. Also, both the military and civil aviation fleet were operated to meet the medical needs. Despite the goodness of all of these, it overlooked the repercussions of one vital problem.

The government spent about KD 1.5 billion to cater for health and medical needs without referring the matter to the National Assembly. However, when it came to the financial stimulus bill, it linked its approval to the National Assembly.

It is as though the government is telling people that pleasing the parliamentarians is more important than saving people economically. That is exactly what the government is proving by referring the bill to the Parliament.

Of course, the current Parliament will not approve this bill; in fact, it will not approve any bill or law that has financial benefit to the state, and this includes the public debt law.

This is due to the fact that such laws do not positively scratch the electoral ego of the parliamentarians at a time when they are seeking to flex their muscles for media purposes and increase their popularity through reckless stunts such as interpellations, and quickly processing deals that are currently between them and the government.

Consequently, the government is making hay when the sun is clouded. By this, it deserves to be placed in the category of populist accusation for its failure to cushion people from the clutches of the crisis.

We cannot help but wonder how the executive authority closed the taps of financial support and subsequently the country for about 165 days, as it prevented commercial activities and disrupted projects in a semi-suicidal manner, and then forgot that its actions will render entrepreneurs unable to find enough resources to pay the salaries of their staff and meet their financial liabilities such as rents.

How did the government not foresee that the landlords will not be able to repay their loan installments to the banks, and that their fundings will subsequently dry up, pushing them under the weight of deficit which leads to cessation of development projects and an economic downturn from which there cannot be an overnight recovery but will need years?

There is no doubt that His Highness the Prime Minister was aware of the measures taken by the governments of most countries – the wealthy ones and those less wealthier than Kuwait. He saw how they applied their economic stimulus plans without referring to their parliaments, because they were really seeking to rescue their economy and avoid a long-term crisis.

Nonetheless, it seems our government operates as per the principle – “Dissent and you will be known” – as it took ways that are different from the reality of matters.

It seems our government was unaware that its actions were putting the economy of the country at risk, let alone not being at the level of responsibility that was seen in other countries such as Saudi Arabia, the United Arab Emirates, Bahrain, and others that pumped billions into the markets to stimulate their economies, guarantee debts, and encourage small enterprises.

In addition, loan installments were halted, and the economic fate of the people was not put in the hands of the parliamentarians who are more focused on benefitting and gaining even if it is at the expense of the country and its people.

Finally, if the government does not have the will and resolve, and continues to link any step it takes to the National Assembly, our economy will never be sound; instead, it will further deteriorate and shrink.

By Ahmed Al-Jarallah

Editor-in-Chief, the Arab Times

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