Total public debt fell to KD 5.98b by ’18 end
KUWAIT CITY, April 15: Liquid and semi-liquid asset revenues in the general reserve fund declined to 1.2 percent during the period from April 1, 2018 to Dec 31, 2018, compared to 1.6 percent for fiscal 2017/2018, and external borrowings of 2.75 and 3.5 percent for bonds maturing 5 years and 10 years respectively, reports Al-Rai daily.
The report pointed out that the general liquid and semi-liquid assets decreased to KD 11.8 billion at the end of last December, a decrease of KD 1.64 billion or 12.2 percent of the net assets at the end of March 2018, amounting to KD 13.48 billion.
The report showed that the total public debt fell to 5.98 billion dinars by the end of 2018, a decrease of 450 million dinars from the total public debt by the end of June 2018 of 6.44 billion dinars, as a result of the expiration of the duration of the law of public debt, and the maturity of local bonds during the period from July 1, 2018 until Sept 30, of the same year.
The public debt represented 51.3 percent of the total liquid and semi-liquid assets in the general reserve at the end of March 2018. The ratio fell to 50.5 percent by the end of December, taking into account that the maturity of public debt extends to 10 years starting from the fiscal year 2016/2017. The ratio of liquid and semi-liquid assets to the public debt balance is approximately 1.9 and 2 times as of March and December of 2018.
This indicates that the public debt situation is currently considered safe. On the other hand, the ratio of the total balance of external public debt and short-term liabilities amounted to 18.7 percent of total liquid and semiliquid assets in the general reserve at the end of March 2018.
The ratio rose to 21.3 percent at the end of December, while the ratio of liquid and semi-liquid 5.4 and 4.7 times in March and December 2018, indicating the ability of the State to pay its obligations.
The indicators of financial sustainability measured by the end of December indicate that the state’s finances are not sustainable due to recorded high budget deficits in previous years, taking into account GDP growth rates, interest rates for public debt, population growth rates and reserves, which requires the adoption of measures to address the state budget, and raise the rates of real growth of the economy while maintaining the credit rating, and reduce the increase in public debt costs.